Getting started with insurance

[Okenba]

How is it that you could have paid more for the whole life plan and yet get less coverage ???

This is true for all whole life vs term life. If you don't see that, you're not trying very hard to make a comparison.

I just did some Google search earlier to find a non mindef term life. It costs about 1.5x the mindef one. Which still makes it tons cheaper than whole life. (About $50/mth compared to your current 450/mth)

There is nothing surprising at all that term life can be cheaper and have more coverage than whole life. That's just how expensive whole life is. If you'd bother to do some Google searches, you'd see that for yourself. (As above. Just by doubling the term life premium, one can pay about 100/mth for twice your coverage. 500k.)

 

[Kimberlynghh]

This is true for all whole life vs term life. If you don't see that, you're not trying very hard to make a comparison.

I just did some Google search earlier to find a non mindef term life. It costs about 1.5x the mindef one. Which still makes it tons cheaper than whole life. (About $50/mth compared to your current 450/mth)

There is nothing surprising at all that term life can be cheaper and have more coverage than whole life. That's just how expensive whole life is. If you'd bother to do some Google searches, you'd see that for yourself. (As above. Just by doubling the term life premium, one can pay about 100/mth for twice your coverage. 500k.)

I think they are 2 different instruments and shouldn’t be compared in that manner. Each instrument exists for a reason. Term life, may be more value for money in the long run in terms of coverage and cost paid, but at the same time, not everyone is willing to use their retirement money to pay for it or have the worry that of not being able to pay for it when they get older. If in the event the person is unable to pay for it, at that age, for whatsoever reason, he is basically left with 0 coverage. But of course, you don’t mind having to pay for it throughout your life, and it doesn’t bother you, you are very sure that you will have enough money to pay for it, then sure you can do that. Having this in mind, whole life with limited payment comes into counter this very problem, where you clear your premiums in the earlier years and need not worry about them later on in life where you may have more liabilities. Not everyone considers this when they plan for their retirement. To each is own, there is no right or wrong instrument just whether you prefer it or not and whether it suits your needs.

 

[Kimberlynghh]

My current whole life plan covers Death, TPD, TI and CI (as a rider)

I'm only interested in CI so my agent told me it is available as a term policy but the premiums are only only $100 different for the same coverage.

The only thing that bugs me now is that the break even surrender value is quite late around 75 cos I bought it late.

Main thing you need to think or prioritise is:
Does it bother me that I have to service my policy until 75 years old?
Am I willing to pay more now or I should say do I have the ability to service my policy?
Am I okay that the term plan doesn’t provide me with me any cash value?
Do I have a back up plan in the event I can’t afford to pay for my Term plan in the later years?

1 life plan tbh not enough, because if you contract a CI, there goes your whole life plan.. so if you pass on, nothing left to leave for your family/relatives. So identify your needs/priorities and then decide what’s best for you, then let your agent know about it or if you need a second opinion ask another advisor.

 

[Mr. Wood]

can use MA to buy multiple careshield? 3x$600 all deduct MA?

 

[BBCWatcher]

can use MA to buy multiple careshield? 3x$600 all deduct MA?

Yes, that's allowed, provided the other individuals are related to you. Here's the list of eligible relatives: your spouse, children, parents, siblings, and grandparents.

 

[LexusIS]

I already gotten for my baby girl a whole life with CI/ECI x2 multiplier
Whole life - $250k
CI - $50k
ECI - $25k

Looking for term to supplement the coverage and I m thinking to buy for her when younger so that coverage will be cheaper. Any term that is cheap amd value for money?

Potentially looking at until age 65 or 70
- baby girl
- birthday June 2020

 

[boredboiboi]

I already gotten for my baby girl a whole life with CI/ECI x2 multiplier
Whole life - $250k
CI - $50k
ECI - $25k

Looking for term to supplement the coverage and I m thinking to buy for her when younger so that coverage will be cheaper. Any term that is cheap amd value for money?

Potentially looking at until age 65 or 70
- baby girl
- birthday June 2020

U would want to still go for wholelife plan but with higher multiplier.
Previous quote and for a baby girl, coverage about (26k X 5)130k death/tpd and (26k X 5)130k eci, premium about 900+ per year for 25 years

 

[hardwarezoner2]

I think I'm paying too much .. I've asked for the coverage to be lowered to 100 k. My agent told me the Prulife multipilier is not available anymore. So I may need to sign another policy and also, the previous 150k coverage will have no value. So it's like a partial surrender.

 

[winthony]

I already gotten for my baby girl a whole life with CI/ECI x2 multiplier
Whole life - $250k
CI - $50k
ECI - $25k

Looking for term to supplement the coverage and I m thinking to buy for her when younger so that coverage will be cheaper. Any term that is cheap amd value for money?

Potentially looking at until age 65 or 70
- baby girl
- birthday June 2020

Would make more sense to get a wholelife if you are keen. Term as much as she is younger and cheaper, the coverage years is also longer. Instead, a limited pay WL would allow her to have a longer time horizon to accumulate the cash value if need be!

 

[soneat]

I already gotten for my baby girl a whole life with CI/ECI x2 multiplier
Whole life - $250k
CI - $50k
ECI - $25k

Looking for term to supplement the coverage and I m thinking to buy for her when younger so that coverage will be cheaper. Any term that is cheap amd value for money?

Potentially looking at until age 65 or 70
- baby girl
- birthday June 2020

Insurability may be a concern if the sum assured is too large (e.g. More than 600k). Just a FYI.

You can go to comparefirst and generate quotes and take a look yourself to have a feel of the pricing. Term plans r very cheap too.

 

[soneat]

I think I'm paying too much .. I've asked for the coverage to be lowered to 100 k. My agent told me the Prulife multipilier is not available anymore. So I may need to sign another policy and also, the previous 150k coverage will have no value. So it's like a partial surrender.

It would be good if you can try to understand the underlying insurance principles and attempt to rationalise what you want to do.

Whole life basically has 2 components, an insurance component (you are basically buying a term to 100 years old) that provides the cover for the basic sum assured and an investment component (par fund) which funds the annual bonus and terminal bonus upon the claim event.

For whole life with multiplier till x age, it is essentially a whole life insurance bundled with a decreasing term insurance till x age.

Look at your plan T&C to see if its possible to reduce the basic sum assured if that's what you desire to do.

 

[LexusIS]

Thanks winthony and bored for advice.

Sure, in that case I will look at another whole life. can I have a quote for whole life $250k, ci $50k and eci $25k. 25 years limited pay.

 

[LexusIS]

Insurability may be a concern if the sum assured is too large (e.g. More than 600k). Just a FYI.

You can go to comparefirst and generate quotes and take a look yourself to have a feel of the pricing. Term plans r very cheap too.

Oh is it?

I m thinking about just buying for her when she is young so that probably she don’t need to buy another insurance in future. Since buying young helps.

 

[winthony]

Thanks winthony and bored for advice.

Sure, in that case I will look at another whole life. can I have a quote for whole life $250k, ci $50k and eci $25k. 25 years limited pay.

No worries!

Would that amount be before or after multiplier? If it is after multiplier, what would be your desired multiplier value?

 

[LexusIS]

No worries!

Would that amount be before or after multiplier? If it is after multiplier, what would be your desired multiplier value?

Oh before multiplier, 2x multiplier is what I m looking at. Will be similar to the one I currently have.

 

[boredboiboi]

Oh before multiplier, 2x multiplier is what I m looking at. Will be similar to the one I currently have.

She is young, i will suggest going for 5 times multiplier.
Maybe u can go for base 100k death/tpd and eci 30k and multiplier 5, means 500k death/tpd and 150k eci. Which is same as ur 250k, 50k ci and 25k eci with 2 multiplier.
She is young, just go all into eci and the premium difference is very minimal.

Will quote both and show u the difference from 1 company first.
Eci covera all stages of ci.
Company M
250k death/tpd, 50k ci , 25k eci with 2 times multiplier(500k death/tpd, 100k ci, 50k eci) - $2248.90/year
100k death/tpd, 30k eci with 5 times multiplier(500k death/tpd, 150k eci) - $1359.13/year

Multiplier is until age 70.

 

[winthony]

Oh before multiplier, 2x multiplier is what I m looking at. Will be similar to the one I currently have.

Ahh, if going by say Company M, the premium would be $2248.90/annually!

 

[BBCWatcher]

I m thinking about just buying for her when she is young so that probably she don’t need to buy another insurance in future. Since buying young helps.

It probably won’t work out that way. There are a lot of life insurance policies that parents and grandparents bought with sums assured that don’t offer meaningful protection 30+ years later. Inflation is the culprit.

I don’t think it’s generally a wise use of discretionary savings dollars to buy life insurance for children.

 

[boredboiboi]

Thanks winthony and bored for advice.

Sure, in that case I will look at another whole life. can I have a quote for whole life $250k, ci $50k and eci $25k. 25 years limited pay.

You are welcome.

She is young, i will suggest going for 5 times multiplier.
Maybe u can go for base 100k death/tpd and eci 30k and multiplier 5, means 500k death/tpd and 150k eci. Which is same as ur 250k, 50k ci and 25k eci with 2 multiplier.
She is young, just go all into eci and the premium difference is very minimal.

Will quote both and show u the difference from 1 company first.
Eci covera all stages of ci.
Company M
250k death/tpd, 50k ci , 25k eci with 2 times multiplier(500k death/tpd, 100k ci, 50k eci) - $2248.90/year
100k death/tpd, 30k eci with 5 times multiplier(500k death/tpd, 150k eci) - $1359.13/year

Multiplier is until age 70.

 

[LexusIS]

You are welcome.

She is young, i will suggest going for 5 times multiplier.
Maybe u can go for base 100k death/tpd and eci 30k and multiplier 5, means 500k death/tpd and 150k eci. Which is same as ur 250k, 50k ci and 25k eci with 2 multiplier.
She is young, just go all into eci and the premium difference is very minimal.

Will quote both and show u the difference from 1 company first.
Eci covera all stages of ci.
Company M
250k death/tpd, 50k ci , 25k eci with 2 times multiplier(500k death/tpd, 100k ci, 50k eci) - $2248.90/year
100k death/tpd, 30k eci with 5 times multiplier(500k death/tpd, 150k eci) - $1359.13/year

Multiplier is until age 70.

Thanks so much boredboi will consider it