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Things you should read before buying an endowment plan

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Old 30-08-2016, 12:11 PM   #796
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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!
LOL at your last sentence. You make perfect sense.

But don't forget what happens if you get struck by CI after 65? U need the lump sum to cater for your treatment, medical care etc?
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Old 30-08-2016, 12:43 PM   #797
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LOL at your last sentence. You make perfect sense.

But don't forget what happens if you get struck by CI after 65? U need the lump sum to cater for your treatment, medical care etc?
Should have earned enough by then to cover liao. Remember there is medishield life. So earnings(savings)+investment+medishield life should reasonably covered for most medical expenses. At most get a H&S. If even that isn't enough then maybe need outside help.

Getting insurance doesn't mean it's confirmed covered, suay tio something that isn't included/covered in the CI then... Always hear agents talk about someone tio something but didn't buy the insurance for it but actually how about those that bought and cannot claim due to whatever reasons?

How many people actually need or did managed to claim? More than 50%? More than 20%?
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Old 30-08-2016, 01:30 PM   #798
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Should have earned enough by then to cover liao. Remember there is medishield life. So earnings(savings)+investment+medishield life should reasonably covered for most medical expenses. At most get a H&S. If even that isn't enough then maybe need outside help.

Getting insurance doesn't mean it's confirmed covered, suay tio something that isn't included/covered in the CI then... Always hear agents talk about someone tio something but didn't buy the insurance for it but actually how about those that bought and cannot claim due to whatever reasons?

How many people actually need or did managed to claim? More than 50%? More than 20%?
I fully agree. What is the real reason for buying CI and what does CI mean? At least for me it is that if I were to get CI (stage 3 or 4 don't forget) at an early age, I can use the money to pay for expenses outside of my hospital plan coverage (which probably would be VERY expensive as some agents say) and also if it drags on. I know of a colleague who did have breast cancer at 30s stage 4 when found out (real life experience, not "they say" or "my friend's friend" like agents like to quote) and had gone in and out of hospital for about 2 years before passing on. Obviously there is a loss of income for the family and they need money to take care of you and themselves for 2 years of inability to work. And situation might be worse if you have children. Fair enough.

Say i'm 65 and i get cancer stage 4. What are the chances of a 65 year old person having stage 4 cancer and ability to last for more than 1 or 2 years. Possible, but slim considering the old age and if so, do I still need such a large sum of money since most of my expenses will be covered by hospital plan. And as Perisher mentioned, if I were to save the difference from me paying a hefty 99 year death/CI coverage, let's assume a $140/month difference -
$140 x 12 = $1680/year
$1680/year x 37 years = $62k
$62k x 3% compound interest (average, say if i throw inside STI ETF and forget about it) = $185,561.69 at age 65.

I believe $185k say I spend for 2 years (about $7.7k/month) on my own without additional money from my approx 30+/40 year old children should be fairly sufficient. But yeah I won't be remembered for leaving money for my children a large sum of money.

But that's just me.
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Old 30-08-2016, 01:54 PM   #799
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this quote is an example of not understanding how policy works even after so many explanation.
Can not an insurance company up lorry? All that were paid in over the years gone and insured become uninsured.
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Old 30-08-2016, 02:02 PM   #800
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I fully agree. What is the real reason for buying CI and what does CI mean? At least for me it is that if I were to get CI (stage 3 or 4 don't forget) at an early age, I can use the money to pay for expenses outside of my hospital plan coverage (which probably would be VERY expensive as some agents say) and also if it drags on. I know of a colleague who did have breast cancer at 30s stage 4 when found out (real life experience, not "they say" or "my friend's friend" like agents like to quote) and had gone in and out of hospital for about 2 years before passing on. Obviously there is a loss of income for the family and they need money to take care of you and themselves for 2 years of inability to work. And situation might be worse if you have children. Fair enough.

Say i'm 65 and i get cancer stage 4. What are the chances of a 65 year old person having stage 4 cancer and ability to last for more than 1 or 2 years. Possible, but slim considering the old age and if so, do I still need such a large sum of money since most of my expenses will be covered by hospital plan. And as Perisher mentioned, if I were to save the difference from me paying a hefty 99 year death/CI coverage, let's assume a $140/month difference -
$140 x 12 = $1680/year
$1680/year x 37 years = $62k
$62k x 3% compound interest (average, say if i throw inside STI ETF and forget about it) = $185,561.69 at age 65.

I believe $185k say I spend for 2 years (about $7.7k/month) on my own without additional money from my approx 30+/40 year old children should be fairly sufficient. But yeah I won't be remembered for leaving money for my children a large sum of money.

But that's just me.
My children will start work when i hit 55 (im 33 this yr).

My main concern is that i need adequate coverage during the next 20 yrs or so since they are my dependents. When they start work when i hit 55, i do not need that high coverage anymore, except if i get struck by CI and my expenses need to be covered (this can be covered by H&S plans correct me if im wrong).

I do not intend to leave large sums of money for my children if i die naturally at an old age as i fully expect them to be financially self-sufficient already.

Do i make sense? Anyone of you think the same way as me?
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Old 30-08-2016, 02:43 PM   #801
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Actually there's nothing to discuss about in this thread anymore.
You can get quality financial advice and plan for your retirement (including insurance and investments) for just $8.) *definitely not enough for him to go for trips and afford another bmw/merc*
https://www.indiegogo.com/projects/r...y-finance-book


If you can't afford this $8 (but can pay agents 4 digits in commissions), I'll paste $7.99 worth of his book content here. (pls don't sue me)

If you take only one thing away from this book, I want you to never, ever, ever buy any sort of
investment from an insurance company. No whole life policies. No endowment plans. No
investment-linked policies. Nothing. Ignore what the sales rep tells you about how you’ll be able to
access fancy funds and how great the returns have been in the past
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Old 30-08-2016, 03:52 PM   #802
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What is there to argue.
It's called non guaranteed for a reason. The company has no obligations to pay out this sum. If they give you $0, you have no case against them. You agreed that this sum that was stated was not guaranteed to you, by signing the policy booklet.

They can write as much non guaranteed portion as they like, you agreed that it can be reduced to 0 in the last policy year.

Only if guaranteed sum is not paid out as stated then you have a case to report to the authorities.
I think there is a part where it states that once the non-guaranteed portion is declared, it's yours. Dunno got such detail as last policy year the non-guaranteed that was declared yours already can be reduced to 0 wor.

Is there some misunderstanding?
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Old 30-08-2016, 04:08 PM   #803
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What is there to argue.
It's called non guaranteed for a reason. The company has no obligations to pay out this sum. If they give you $0, you have no case against them. You agreed that this sum that was stated was not guaranteed to you, by signing the policy booklet.

They can write as much non guaranteed portion as they like, you agreed that it can be reduced to 0 in the last policy year.

Only if guaranteed sum is not paid out as stated then you have a case to report to the authorities.
This is misleading, insurance companies cannot do whatever they want. For participating policies, they can only take up to 1/9th of the value of bonuses declared. See following link:

http://www.moneysense.gov.sg/Underst...-Policies.aspx


Can not an insurance company up lorry? All that were paid in over the years gone and insured become uninsured.
This basically will not happen. MAS requires insurance companies to hold reserves sufficient to cover various extreme scenarios. SDIC also covers insurance policies (range from $50k to $500k). Lastly, if insurance company still manage to uplorry, MAS will step in and get another insurance company to take over.
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Old 30-08-2016, 04:17 PM   #804
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I think there is a part where it states that once the non-guaranteed portion is declared, it's yours. Dunno got such detail as last policy year the non-guaranteed that was declared yours already can be reduced to 0 wor.

Is there some misunderstanding?
I think he is talking about future non-guaranteed values.

Once bonuses declared, it becomes the guaranteed portion.
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Old 30-08-2016, 04:20 PM   #805
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still camping for insurance agents to enlighten me why they are peddling products with large decreasing NG returns
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Old 30-08-2016, 04:38 PM   #806
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I think he is talking about future non-guaranteed values.

Once bonuses declared, it becomes the guaranteed portion.
Whatever they declared during the period is not significant. It's the last year based on the pic I showed that determines the final yield of a product.
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Old 30-08-2016, 04:47 PM   #807
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This basically will not happen. MAS requires insurance companies to hold reserves sufficient to cover various extreme scenarios. SDIC also covers insurance policies (range from $50k to $500k). Lastly, if insurance company still manage to uplorry, MAS will step in and get another insurance company to take over.
No matter how big the insurance company is there is still a risk of failing and SDIC only covers a small amount and all your vested interest in medical coverage is gone.

You can only hope MAS that will step in. Nay, why would the government bail out an insurance company that fail, unless it's too big to fail, and only if it's a local insurance company or if many insurance companies fail the about same time. And why would any other insurers want to take over the liabilities of a failed insurer unless there is value to them, not to the insureds.
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Old 30-08-2016, 06:25 PM   #808
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Yup. Nothing wrong with what I said. Once non guaranteed value is declared out as bonus it forms a part of the guaranteed value.

Which I said they are obliged to pay out.

I mean to say if they give u 0 non-guarenteed value for 25 years straight, are they in the wrong?

My statement is clear, upon signing the initial policy booklet, any non-guarenteed value projected is non guaranteed. They are not obliged to pay out. By signing the booklet you have acknowledge this fact.

Last edited by bibu00; 30-08-2016 at 06:28 PM..
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Old 30-08-2016, 06:30 PM   #809
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Whatever they declared during the period is not significant. It's the last year based on the pic I showed that determines the final yield of a product.
Not all insurance companies practice like the one you showed. Meaning they try to give more bonuses at the maturity of the policy.

Some insurance companies practice "smoothing" across the policy years. Every year, they will give smaller and sustainable bonuses.

The way I see, your insurance company tried to over-project and under-delivered when it matured. This is a recipe for bad PR.
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Old 30-08-2016, 07:25 PM   #810
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No matter how big the insurance company is there is still a risk of failing and SDIC only covers a small amount and all your vested interest in medical coverage is gone.

You can only hope MAS that will step in. Nay, why would the government bail out an insurance company that fail, unless it's too big to fail, and only if it's a local insurance company or if many insurance companies fail the about same time. And why would any other insurers want to take over the liabilities of a failed insurer unless there is value to them, not to the insureds.
There is no need to hope. Banks are far more likely to fail than insurance companies. Unless you are familiar with the capital requirements for banks and insurance companies, you just have to trust me on this.

The reason why MAS can transfer the policies to another insurance company is because MAS will be aware of the weakness of an insurance company long before it reaches a point where it will collapse (a lot of the payments happen many years later after all). At this point, they can easily revoke its insurance license and force the weak insurance company to sell its policies to another insurer at a low price. There are also insurers willing to increase their market share by offering to buy them at a loss.
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