Jul 4, 2021

Cory Diary : Life Insurance Policy - Updated

When we first graduated, many of us in our time will be asked to buy Insurance Policy. Not sure about now but possibly except that with Covid maybe harder to sell. Getting information to know about our insurance policy is much easier now than before through login using singpass.

Is great they have worked to integrate the login process with singpass. And that we could see all the policies with the insurance company. Here's a glimpse on a Life Insurance Policy. If the insurance company promise as planned, is a good diversification for the descendent .... . Why I say so.

Projected Death Benefit at age 50 : 173k
Surrender Value : 66k  ( Yield : 4% )

The surrender yield get lower as one aged. At 69 will be 3.35% Projected again.

Basically from the looks of it, will lose slightly more than 100k if we are to surrender it. Again all this is non-guaranteed since they are all projections.


Interestingly the policy also provide projection if we hold on to the policy till age 55.

Projected Death Benefit at age 55 : 189k ( Increase of 12k )
Surrender Value : 87k  ( Increase of 21k , Yield : 3.93% )

The surrender value increases much more than the death benefit but the yield gets lower.

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Decided to continue with my exploration after consultation with the agent because I feel is important. She provides me the guaranteed and non-guaranteed ratio on each age group.

The non-guaranteed portion is about 31% of the projected value. To get the compounded returns, this can be easily done using the monthly payment with the the final return ( Upon Death ) at 50 , 55 or 65.

So plugging in my monthly contribution of the Life Insurance Policy ( excluding rider ), the XIRR or compounded returns is near to 8.7%. This is quite a surprise even though there are non-guaranteed component is in there. In total it is even better than S&P500 Performance. If we surrender the Policy, returns drops to 2%.

Wow. Please Check on Me by login in to count your Life Insurance Policy.


Articles in this Blog is personal take and educational purposes only. Reader should seek their own professional help when making financial decision and be responsible for their decision.

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