Possible financial lost that will cause hardship to a single person (assuming no dependents and no liabilities) are: Lost of income due to disability; High medical bill due to hospitalization; High expenses due to critical illnesses … [Read more...]
What are the financial needs for juvenile?
Possible financial lost that will cause hardship to parents will be: High medical bill due to hospitalization of the juvenile; and High expenses due to critical illnesses of the juvenile. For juvenile, it is important to note that many insurers exclude the whole life critical illness that originates from congenital diseases. Some have a waiting period of the first 7 years of the child’s … [Read more...]
What are the fineprints in investment linked policies (ILPs)?
Investment linked policies (ILPs) provides you with life insurance coverage which depends on the investment performance of the funds chosen. At older age, the cost of insurance can easily exceed the premium. If this happens, the insurer will sell the investment to pay for the cost of insurance. Such regular withdrawal of the investment will deplete the cash value. The depletion is further … [Read more...]
How much of my salary should I spend on insurance?
You should spend as little as possible of your salary in insurance. Get sufficient coverage at the lowest cost is my advice. Therefore it is important to source for the most cost competitive cover. … [Read more...]
Since my insurance premium is huge, I am well covered right?
Most people spent huge amount of money paying insurance premium but actually they are underinsured because they bought "junk" policies. You should examine your needs and source for the solutions. In most cases, people look at the "solutions" and try to fit their needs. This is the wrong way and almost guarantees huge premium into junk policies. You may like to know that the pricing of insurance … [Read more...]
Is company’s group insurance sufficient?
Many employees are covered under their employer's group insurance. If that is the case, many employees do not feel the need to get additional insurance for themselves. The policyowner of the group insurance is the employer. The employee is merely the life assured with no legal rights to the contract. The master contract can be terminated either by the employer or by the insurer. Moreover, the … [Read more...]
Are endowment policy suitable?
Endowment policy is suitable for the individual who is conservative in risk appetite and cannot take risk. In addition, if there is a purpose which imposes on the requirement that no risk can be made, than an endowment policy is recommended. For example, tertiary education can be expensive and yet cannot be delayed once the child reaches certain age regardless of whether does the parents have the … [Read more...]
What are unsuitable insurance?
An insurance product is considered unsuitable if it meets one of the two criterions: The products does not meet one’s needs OR The product meets one’s needs but there is an alternative product that is significantly superior in terms of cost or benefits or both. The keyword is “significantly superior.” Marginally superior is not counted. … [Read more...]
What is Comprehensive Financial Planning service?
Comprehensive Financial Planning service is a written report covering all of the following: Understanding client’s goals, Tabulating the cash flow and balance sheet statements, Credit management, Risk (protection/insurance) management, Education planning, Retirement planning, Investment Planning Tax planning and Estate planning. … [Read more...]
Why is an ILP considered inferior/ a time bomb?
The regular premium investment linked product is an essentially a combination of 1 year renewable term PLUS investment. Since the life insurer does not provide value add service by managing the risk of the underlying investment, there is no reason to buy such a product. It will be more straightforward just to buy a separate term insurance and invest the difference (which is what an ILP does). Here … [Read more...]
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