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Old 15-09-2018, 12:44 PM   #1
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Insurance Policy Dilemma

Hi all, 3 years back I'd gotten for my dad an ILP from GE. Did not fully understand the numbers until recently when a relative fell sick.

The policy covers 50k death, 50k early CI (life), and 50k accident (expires 2034). Premium allocation to the investment component is near-zero as we only wanted the insurance component. Dad is 60 ANB, non-smoker, and only medical history is hypertension.

Currently the premium costs $3,050 per year and I'm thinking of cancelling the policy as the numbers don't look good, mainly due to the following reasons:

1. Death benefit not needed as he no longer has dependants
2. Coverage seems meagre compared to the premium cost. 3k compounded over 14 years at a modest 2% already yields 50k - making a simplistic assumption that we only get paid out on the 50k early CI component since it's the main focus; plus getting a CI within the next 14 years is not a sure event.
3. Existing private hosp shield plan would take care of hosp costs plus follow up for ~6 months if not mistaken

I'm thinking of either changing to a CI/ECI term plan or self-insuring though savings aren't substantial. Appreciate any comments. Thanks!
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Old 15-09-2018, 01:37 PM   #2
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1. Take note that any replacement will not cover existing conditions, be prepared for additional loading of premiums
2. At this age early ci is very expensive, if still necessary consider Covering advance ci instead.
3. Accident plan can get stand alone. Can consider disability income plans.

Your existing ilp depending is backend or front end loading may have different implications if you surrender. Best you find a trusted agent to seek advice

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Old 15-09-2018, 02:59 PM   #3
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What is the name of the policy?
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Old 16-09-2018, 12:03 PM   #4
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What is the name of the policy?
The name is Smart Life Advantage
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Old 16-09-2018, 04:42 PM   #5
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That's the problem when getting bundled products.
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Old 16-09-2018, 04:51 PM   #6
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Hi all, 3 years back I'd gotten for my dad an ILP from GE. Did not fully understand the numbers until recently when a relative fell sick.

The policy covers 50k death, 50k early CI (life), and 50k accident (expires 2034). Premium allocation to the investment component is near-zero as we only wanted the insurance component. Dad is 60 ANB, non-smoker, and only medical history is hypertension.

Currently the premium costs $3,050 per year and I'm thinking of cancelling the policy as the numbers don't look good, mainly due to the following reasons:

1. Death benefit not needed as he no longer has dependants
2. Coverage seems meagre compared to the premium cost. 3k compounded over 14 years at a modest 2% already yields 50k - making a simplistic assumption that we only get paid out on the 50k early CI component since it's the main focus; plus getting a CI within the next 14 years is not a sure event.
3. Existing private hosp shield plan would take care of hosp costs plus follow up for ~6 months if not mistaken

I'm thinking of either changing to a CI/ECI term plan or self-insuring though savings aren't substantial. Appreciate any comments. Thanks!
If you terminate this, your new CI/ECI will exclude hypertension, and almost certainly anything related to it as well.

Does your dad have any shield plan?
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Old 16-09-2018, 05:07 PM   #7
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Why did the agent recommend the ILP for your father when the insurance charge is so high?
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Old 16-09-2018, 05:15 PM   #8
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1. Death benefit not needed as he no longer has dependants

Agree, low value investment when no dependents.


2. Coverage seems meagre compared to the premium cost. 3k compounded over 14 years at a modest 2% already yields 50k - making a simplistic assumption that we only get paid out on the 50k early CI component since it's the main focus; plus getting a CI within the next 14 years is not a sure event.

Agree, use the savings to pay for a comprehensive hosp shield plan instead and still got substantial savings.


3. Existing private hosp shield plan would take care of hosp costs plus follow up for ~6 months if not mistaken

Agree, it will.


I'm thinking of either changing to a CI/ECI term plan or self-insuring though savings aren't substantial.

Can alternatively consider integrated shield plan rider but again is optional depending how risk-averse and ability to set some savings for co-payment/deductible.
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Old 16-09-2018, 05:55 PM   #9
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1. Death benefit not needed as he no longer has dependants

Agree, low value investment when no dependents.


2. Coverage seems meagre compared to the premium cost. 3k compounded over 14 years at a modest 2% already yields 50k - making a simplistic assumption that we only get paid out on the 50k early CI component since it's the main focus; plus getting a CI within the next 14 years is not a sure event.

Agree, use the savings to pay for a comprehensive hosp shield plan instead and still got substantial savings.


3. Existing private hosp shield plan would take care of hosp costs plus follow up for ~6 months if not mistaken

Agree, it will.


I'm thinking of either changing to a CI/ECI term plan or self-insuring though savings aren't substantial.

Can alternatively consider integrated shield plan rider but again is optional depending how risk-averse and ability to set some savings for co-payment/deductible.
Did you forget that his dad has hypertension? Would you think the shield plan would cover that (if his dad hasn't already had one)?
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Old 16-09-2018, 06:33 PM   #10
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Did you forget that his dad has hypertension? Would you think the shield plan would cover that (if his dad hasn't already had one)?
Yes, I would think.

MOH says: "You are covered by MediShield Life even if you have a pre-existing medical condition."

https://www.moh.gov.sg/medishield-li...ing-conditions
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Old 16-09-2018, 06:55 PM   #11
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If you want to stop paying the $3k per year and still keep the insurance, you can convert the policy to being paid up. You no longer pay $3k per year, but the insurance company will sell off a small portion of your funds to pay for the insurance portion. This will continue until you fully cancel the plan or there is no more money left in the funds.

Alternatively, ask yourself if you really need the CI/ECI coverage. 50k is not a lot of money. If something were to happen that allows you to make a claim, is that money really going to make a significant difference?

If you really need CI/ECI coverage, are you prepared to go without coverage for hypertension? If so, then yes, it might be better to switch to a term plan. You may not necessarily lose coverage for hypertension, it would depend on a few things. It's best to check with your agent who would probably check with underwriting.
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Old 16-09-2018, 11:21 PM   #12
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Thanks very much everyone for your input. Yes, my dad is covered by a integrated shield plan (Totalhealth from GE up to Class A). Perhaps it's good to break it down into the various possible outcomes as some of you folks have highlighted the condition of hypertension. I will not attempt to blindly assign any specific probabilities but suppose it will help in dissecting this issue:

1. No major illnesses
2. Illness related to hypertension, perhaps a stroke or a cardiac disease: bulk of the costs should be covered by the shield plan; long term meds perhaps not too costly to warrant a CI plan. Any ops within the first 6 months are also covered by the shield plan IIRC.
3. Cancer: the costs will likely be too massive to be covered by the 50k anyway. His family also does not have a history of the illness.
4. Diabetes, others - not sure about the impact/possibility; but my dad is not obese so the risks might be lower.

I could be missing something here... Would love to hear your thoughts.

Last edited by switzerp800; 16-09-2018 at 11:23 PM.. Reason: Typo error
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Old 19-09-2018, 12:10 AM   #13
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Yes, I would think.

MOH says: "You are covered by MediShield Life even if you have a pre-existing medical condition."
Yes. MediShield Life will cover pre-existing illness, but there will be exclusion for ISP.
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