one quick qn b4 i go sleep.. life term can get back money or not? as in after the maturity. or is it endownment?
my current is NTUC LUV deluxe plan (with CI), good or not? but i see SAF aviva like better.. till 65 yr old pay same amt.
For life insurance there are basically two kinds. One is term, where you pay only for protection and so there is no money to get back if you do not make a claim. NTUC LUV and SAF Aviva are both term plans and I think they are both good.
The second is permanent, such as whole life insurance, which has both protection and investment components. The bonuses that the company credits to policyholders and the money that they get back should they not claim does not come from thin air - it comes from the investment component. The insurance company invests your money for you in the meantime and then gives it back to you after deducting expenses and profit.
Many people have whole life and other non-term life policies because insurance companies and agents prefer to sell those; some may not have even heard of term. Some people are not interested or not confident in investing and so they may want to have the insurance company do it for them, even as a way to force themselves to save. However, often the high premiums payable results in people being underinsured for their needs. For example, someone may only have enough money to pay the premiums for a $50k sum assured whole life policy, but in reality $50k is inadequate and he can afford a $250k sum assured term policy.
You can first assess how much coverage you need and what kind of an investor you are to determine what balance of term and permanent insurance you should get.
