Getting started with insurance

[soneat]

What does your point 3 means? Isnt it the same? Its just different company uses diff words, booster and multiplier is the same and all come with base as well.

Aviva and GE implementation is similar.
For a S$100K Sum Assured with additional 200% cover till 70yo, the actual payout is S$100K+bonuses+S$200K (for before 70yo)

For other companies like, eg, Income,
For a S$100K Sum Assured with 300% minimum death benefit till 70yo, the actual payout will be S$300k (or S$100K+bonuses, whichever is higher) for before 70yo.

IMHO, it is not easy to conclude which ECI whole life plan is "best" in the mkt right now. The differences between the coverage vs premium is quite marginal. Previously before 1st Jul 2021, I can say that GE ECI is probably the best because the pricing is really good but they have raised the premium since then.

 

[xtwis7]

What does your point 3 means? Isnt it the same? Its just different company uses diff words, booster and multiplier is the same and all come with base as well.

Yes they’re still essentially the same with one biggest difference, companies with multiplier pays out the maximum limit up to the multiplier coverage while GE’s case is base + bonus + booster so it has a slightly higher coverage for the years before the expiry of the ‘multiplier’.

Multiplier is less customisable in a way if the desired coverage is not a nice figure for whatever reason.

The base and booster concept is just like a whole life + term combined because essentially that’s what life plans with additional coverage are today.

 

[RonnieB1]

Hi Guys,
My children have life insurance plus critical illness policies held for about 15 years . They are likely to take up residence in another country and may have tax implications later on. Is it better to surround the policies compltely or take a loan and let it run down. Any thoughts or advise would be appreciated. Ron

 

[RonnieB1]

Sorry meant surrender. Fat fingers and autocomplete error

 

[boredboiboi]

Hi Guys,
My children have life insurance plus critical illness policies held for about 15 years . They are likely to take up residence in another country and may have tax implications later on. Is it better to surround the policies compltely or take a loan and let it run down. Any thoughts or advise would be appreciated. Ron

What would be the implications of a life plan when they are in another country? I dont see any implication

 

[RonnieB1]

What would be the implications of a life plan when they are in another country? I dont see any implication

Tax implications for investment linked insurance and when making claims. Anyway if you needed to stop a policy would it better to surrend completely or take a Lon and let it deplete itself ( in case you change your mind in a year or so ). Thoughts?

 

[boredboiboi]

Tax implications for investment linked insurance and when making claims. Anyway if you needed to stop a policy would it better to surrend completely or take a Lon and let it deplete itself ( in case you change your mind in a year or so ). Thoughts?

Life insurance or investment plan? I dont think its subjected to tax. Plus its under ur name when u buy, dont change policy holder to their name.If its investment and they dont need the coverage u May surrender it or replace it with a full protection plan.

 

[xtwis7]

Tax implications for investment linked insurance and when making claims. Anyway if you needed to stop a policy would it better to surrend completely or take a Lon and let it deplete itself ( in case you change your mind in a year or so ). Thoughts?

If you’re looking to stop then definitely surrendering is the better choice here. What for pay the loan interest.

 

[xtwis7]

Life insurance or investment plan? I dont think its subjected to tax. Plus its under ur name when u buy, dont change policy holder to their name.If its investment and they dont need the coverage u May surrender it or replace it with a full protection plan.

I believe the new country of residence might be US and he was probably the proposer for the kids when they were young but they still remain as the life assured.

If indeed it’s US, yes all policies with cash value are implicated whether it’s a proposer or life assured.

 

[boredboiboi]

How will life assured only affect them? Nothing is payout to them if anything happen. It only payout to the policy owner. If nothing is paid out to them, nothing will be tax to them thus no implication unless they are the policy owner.

 

[BBCWatcher]

It's not just the U.S., although it could be the U.S. Many countries tax certain types of insurance policies in various ways. That's not surprising. Generally speaking the tax is avoidable if the policy is surrendered strictly before stepping foot in the new country, ideally within the tax year prior to the first partial tax year of new residence. For example, if the new country has a tax year based on the calendar year, and you move to the new country on June 15, 2022, then it would generally be best to exit the policy before 2021 ends.

Sometimes you can surrender the policy to a third party for a better exit than what the insurance company itself is offering.

Borrowing against the policy probably doesn't solve the tax problem, so that's another reason not to do it. In many tax jurisdictions the policy would still attract tax, and the loan interest on the policy wouldn't be creditable. In other words, it could be even worse than just accepting the tax hit.

Add this reason to the long list of reasons not to buy most insurance products for children. There's a big, complicated world outside Singapore. However, if you insist, generally speaking you can buy a simple term life insurance policy for a child with zero surrender value and no investment or savings component, and that should be broadly "tax friendly" internationally.

 

[RonnieB1]

It's not just the U.S., although it could be the U.S. Many countries tax certain types of insurance policies in various ways. That's not surprising. Generally speaking the tax is avoidable if the policy is surrendered strictly before stepping foot in the new country, ideally within the tax year prior to the first partial tax year of new residence. For example, if the new country has a tax year based on the calendar year, and you move to the new country on June 15, 2022, then it would generally be best to exit the policy before 2021 ends.

Sometimes you can surrender the policy to a third party for a better exit than what the insurance company itself is offering.

Borrowing against the policy probably doesn't solve the tax problem, so that's another reason not to do it. In many tax jurisdictions the policy would still attract tax, and the loan interest on the policy wouldn't be creditable. In other words, it could be even worse than just accepting the tax hit.

Add this reason to the long list of reasons not to buy most insurance products for children. There's a big, complicated world outside Singapore. However, if you insist, generally speaking you can buy a simple term life insurance policy for a child with zero surrender value and no investment or savings component, and that should be broadly "tax friendly" internationally.

Hi BBCW
You are really far sighted and can pick out all the overlooked angles which others dont realise or consider.
Thanks Ron

 

[qrcode]

Need some suggestion about CI plan:
EearlyCI or MultiPayCI, which is better?

And what is the recommended age to be covered to? 65, 75, 85?

 

[boredboiboi]

Need some suggestion about CI plan:
EearlyCI or MultiPayCI, which is better?

And what is the recommended age to be covered to? 65, 75, 85?

Depends on what u need. Different pple have different needs.
Usually pple get till age 65/70/75 and also depends on budget.

 

[winthony]

Need some suggestion about CI plan:
EearlyCI or MultiPayCI, which is better?

And what is the recommended age to be covered to? 65, 75, 85?

EarlyCI or Multipay depends on quite a number of factors actually!

With multipay, it comes with of course, a higher premium, the question is, do you think you would benefit from the multipay structure or you are leaning more towards a lump sum pay out? Clients usually choose MultipayCI if they are thinking of coverage after diagnosis and are generally okay with forking out a premium. It also depends on what age you want for yourself because you dont usually benefit that much from the multipay structure when you are older.

As for age, usually anything above 75 would be quite costly as the premium increase is quite exponential. But it also depends on your entry age. I would be leaning towards going 65~75 if your concern is to safeguard during your working years for your dependents because reality is, if a diagnosis occurs at 85, chances of you claiming for the multipay ci after your first diagnosis is lower

 

[xtwis7]

Need some suggestion about CI plan:
EearlyCI or MultiPayCI, which is better?

And what is the recommended age to be covered to? 65, 75, 85?

Asking this is hard to give you a definitive answer. Both are equally good provided they suit the client so there's really no best product but the most appropriate/suitable product will be the one.

I believe we all need to rethink looking at them from products perspective and you can ask yourself which will you favour more? Age also depends on how well you view your mortality to be, chances of someone contracting a CI in the 80s should be higher than someone in the 60s but there's a price to pay for this. Plan type and budget along with your needs make a ideal recommendation.

 

[zeezeex]

Hello. If we were to switch agent for a hospital insurance plan. May I ask if the new agent will be able to get any commission? Premium is paid annually. TIA.

 

[winthony]

Hello. If we were to switch agent for a hospital insurance plan. May I ask if the new agent will be able to get any commission? Premium is paid annually. TIA.

Hello! do you mean switching agent within the same company?

 

[boredboiboi]

Hello. If we were to switch agent for a hospital insurance plan. May I ask if the new agent will be able to get any commission? Premium is paid annually. TIA.

Change agent, new agent no commission, but income change of agent got commission which is very very little as main commission is on first year.
Change to another hospital plan, new agent got commission.

 

[zeezeex]

Hello! do you mean switching agent within the same company?

Yes within same company!