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Things you should read before buying an endowment plan

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Old 29-08-2016, 08:02 PM   #766
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As promised, here is the latest BI of my one and only participating policy (endowment) from an insurance company. It is an 18-year policy so I am halfway there.

At that time, this was the only plan that can offer a guaranteed value higher than the premiums paid based on my affordability. The other one was from TM but I need to pay higher monthly premiums.

Guaranteed yield of policy upon maturity = 0.72%
Non-guaranteed yield of policy upon maturity = 1.62%

wah bro, how come the returns so cui?
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Old 29-08-2016, 08:03 PM   #767
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Didn't read the thread but i wonder why no one mentioned STI ETF? Is a supposed 8.4% annualised return. I was surprised to see the guaranteed return is only 0.72% for a 10+++ year endowment plan. That's actually worse than bank fixed D now.

STI ETF is super easy to buy now. You can buy through banks or online if you don't know how to on trading platforms. If you know how, share them with your younger friends and how it may help them generate more returns in future than ilps or endowments.

Coming to the hate part. I always wonder where the money from the many many incentive trips that my agent friends get to enjoy every few months. Wait. Its your hardearned money used to fund someone else's travel! Sounds great!
i alr mentioned this liao in so many threads here and always kenna bashed by insurance agents
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Old 29-08-2016, 08:26 PM   #768
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i alr mentioned this liao in so many threads here and always kenna bashed by insurance agents
Its ok la bro. We can only educate our loved ones who are willing to listen. Same like my mom, already 60, i buy for her hospitalisation plan cause its really important. Term plan, i tell her don't need la. If she really anything happen, i dont want take her money also. No point.

Like some agents tell me before to buy my term plan until 99 la, why only until 65. If i pass away 75 years old how? Then i said by then my child alr 30+ or 40+ dont need my money to take care of him alr (i.e. my dependent). Then the agent tell me how you want your grandchildren remember you? I said if my grandchildren remember me only because of my 1 million then they should be struck by lightning!
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Old 29-08-2016, 08:27 PM   #769
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wah bro, how come the returns so cui?
It was bought 10 years ago. My one and only participating policy from an insurance company. If I can turn back time, do you think I will sign up for this plan?

The post was meant for information sharing in this thread.
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Old 29-08-2016, 08:32 PM   #770
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Insurance when it begun at its most pure sense was supposed to let me (if im agent) help and protect your life, and in the mean time, i earn my living.

But now it has deteriorated into let me (if im agent) earn so much to get my bmw/condo/incentive trips by selling you things that may/may not (most cases) help you. The incentive of motivation is already a conflicting interests in its core. So why should they care more about your money when their own money/target is much much much more important
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Old 29-08-2016, 08:39 PM   #771
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Insurance when it begun at its most pure sense was supposed to let me (if im agent) help and protect your life, and in the mean time, i earn my living.

But now it has deteriorated into let me (if im agent) earn so much to get my bmw/condo/incentive trips by selling you things that may/may not (most cases) help you. The incentive of motivation is already a conflicting interests in its core. So why should they care more about your money when their own money/target is much much much more important
Well said

Unfortunately, they will not agree with what you said
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Old 29-08-2016, 09:33 PM   #772
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hi guys, would just like to humbly seek your opinion on my endowment policy from ntuc income that my dad got for me (he was an ntuc agent before). i've been trying my best to understand all these policies, but somehow i always feel that im missing something out, hope you guys could educate and enlighten me further!



this is a 20 years term plan that was bought for me when i was 15 YO. just 1 question i would like to ask:

1) should i just look at the guaranteed portion after maturity? what about the non-guaranteed portion? i believe the insurance company will at least provide a 2.7x% (correct if me im wrong pls) investment return, which will be based on the market or something?

looking forward to all of your expertise. thank you!
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Old 29-08-2016, 09:53 PM   #773
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Guaranteed amount is slightly lower than total premiums paid

CAGR is 2.29% (please correct me if wrong) if considering the projected total amount stated in the BI, which is $16,075

I would not look too deep at what it states on the BI about breakeven at 10th year
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Old 29-08-2016, 10:10 PM   #774
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Is this the latest BI? Because the original BI and current BI values will differ

I calculated the irr to be 4.1%, correctme if i am wrong.this is assuming the policy meets the 5.25% projection
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Old 29-08-2016, 10:25 PM   #775
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i think so..? this was the policy that my dad passed to me. i believe there shouldn't be any changes.. will login to ntuc income to double check again..
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Old 29-08-2016, 10:26 PM   #776
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Guaranteed amount is slightly lower than total premiums paid

CAGR is 2.29% (please correct me if wrong) if considering the projected total amount stated in the BI, which is $16,075

I would not look too deep at what it states on the BI about breakeven at 10th year
hi mrclubbie,

thank you for your reply! yes, i won't be surrendering this policy for now.. since i'm already halfway through already. just wanna seek all your opinions on whether this policy is "reasonable".

but back to my question, what are the odds that insurance company pay out the non-guarantee portion? because since my guaranteed is lower than premiums paid.

thanks again!
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Old 29-08-2016, 10:32 PM   #777
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i think so..? this was the policy that my dad passed to me. i believe there shouldn't be any changes.. will login to ntuc income to double check again..
BI will change, best is get the updated BI
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Old 29-08-2016, 10:38 PM   #778
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BI will change, best is get the updated BI
hi mrclubbie,

understood. may i know how should i go about getting the latest BI? calling up ntuc and asking them to send it to me?

while i'm on this, i have 2 whole life policies with ntuc income also; will life policies also have changes to its BI?
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Old 29-08-2016, 10:46 PM   #779
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To me, it unlikely to get the maturity sum of 16,075 which translate to a 4.1% return per annum. You will be lucky if you get 3% or about 14,142.

From the BI, at end of each year, your cash value is less than the accumulated premium paid and you will lose if you surrender before end of 10 years without taking into account interest loss. If the declared bonus is less than projected, the breakeven point may be 13 or more years.

The NG value is the bonus that it will declare at the end of each year and accumulate. So at each point you look at the guaranteed amount plus the accumulated bonus that has been declared to get your cash value.

Since you are half way through, say end of 10 year, look out for the accumulated bonus that has been declared and compare to the projected NG value and you will have a rough idea whether you will get the projected NG value of 6,075. Quite certainly, it's less. Please let us know the numbers.

Last edited by henrylbh; 29-08-2016 at 10:49 PM..
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Old 29-08-2016, 10:49 PM   #780
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hi mrclubbie,

understood. may i know how should i go about getting the latest BI? calling up ntuc and asking them to send it to me?

while i'm on this, i have 2 whole life policies with ntuc income also; will life policies also have changes to its BI?
You can log in ntuc online to check your acct.

Yup whole life have non guranteed portions too so the figures will change.
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