life insurance, if i dun die, when can i get money back?
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i pay premium to prudential every month. when can i get it back if i dun die so fast.
i prefer to use the money for investing or spending leh...
put there then when can get back, especially if i dun die prematurely....
someone pls enlighten me.
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depends on the plan actually.
But typically, you really want to die to gain maximum EV=)
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Originally posted by january:
i pay premium to prudential every month. when can i get it back if i dun die so fast.
i prefer to use the money for investing or spending leh...
put there then when can get back, especially if i dun die prematurely....
someone pls enlighten me.
if yours is a term policy, then no returns...you gotta take a look at your insurance plan, the one your agent should have given you with the assured and expected returns... -
If you buy term, no return just benefit ( that is when you die ) . If you buy life, still can take loan when there is sufficient cash value. Your beneficiary will benefit when you die. The later you die the more they get. If you buy endowment, it depend on how many year you buy, 10, 15, 20 or 25 etc... hope this help :) Your insurance agent should had explained to you ... check with him ...
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Originally posted by ORIGAMIST:
If you buy term, no return just benefit ( that is when you die ) . If you buy life, still can take loan when there is sufficient cash value. Your beneficiary will benefit when you die. The later you die the more they get. If you buy endowment, it depend on how many year you buy, 10, 15, 20 or 25 etc... hope this help :) Your insurance agent should had explained to you ... check with him ...
If you are still young and has some liability .. best is buy life insurance because it will be low cost and make sure you have comprehensive medical coverage.
If you have surplus .. put it in some viable investments or savings with good interests.
I never like endowment policies.. because it will always cost you some premium to cover your life anyway and you cannot control the returns.
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young better to buy life insurance? Thought should be term?
i was thinking of buying insurance last time and my friend recommended www.secondopinion.asia .I paid $90 for unbiased advice on what kinds of insurance i really need. They sent me the comparison between term and life and showed why agents keep selling life insurance..
In the end i followed their advice and bought term myself leh
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Originally posted by Janice888:
young better to buy life insurance? Thought should be term?
i was thinking of buying insurance last time and my friend recommended www.secondopinion.asia .I paid $90 for unbiased advice on what kinds of insurance i really need. They sent me the comparison between term and life and showed why agents keep selling life insurance..
In the end i followed their advice and bought term myself leh
First and foremost , I am not an insurance expert.
Anyway.. here's my personal two cents.
If you purchased term insurance.. how long is your coverage ? 5 years ? 15 years ? 30 years ?
Suppose the term expires.. will you still get any coverage ?
By then.. will you have enough savings to cover all your liabilities if you depart ?
It if is renewable.. will you need to pay a higher premiums ? Due to your age and health conditions ?
If it is not renewable.. that means you will need another policy at a older age. And it ain;t gonna be cheap.
What happens if you are diagnosed with some illness.. will the insurance company be willing to extend the coverage ?
Frankly.. I don't really care how the agents are being paid.. they can push certain policies.. ultimately.. it is my needs and financial ability that will decide which policy I will purchase.
You can seek advise from the agents... but ALWAYS.. read up on the prints and understand the terms and what it covers ... yourself.
And remember.. Insurance is not an Investment. It is an instrument to ensure your spouse/family be financially taken care of.. if you depart..(at a cost.. the premiums)
Typically.. young people will go for term.. because it's probably cheaper than life/annuities. So you decide, base on your financial ability.
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Thanks for feedback!!
Mine is life insurance type. I think there is a break even period of around 15 to 20 years where you can get back in cash the amount of premium u have put in over the long years. Am i Right?
I dun want be pay for life insurance where I cannot get much of the premium back after lets say 20 years when I want to end the insurance. I dun really intend to pay until I die and then let the money go to my kins because I need to spend it in the future. I noe I very money face. hehe
I think its what they always call the surrender value or cash value of your insurance which how much your insurance is worth if you terminate the policy to get cash.
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what is the difference between life insurance and endowment? I read about term insurance in the papers so i know roughly what it is already.
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Originally posted by jojobeach:
First and foremost , I am not an insurance expert.
Anyway.. here's my personal two cents.
If you purchased term insurance.. how long is your coverage ? 5 years ? 15 years ? 30 years ?
Suppose the term expires.. will you still get any coverage ?
By then.. will you have enough savings to cover all your liabilities if you depart ?
It if is renewable.. will you need to pay a higher premiums ? Due to your age and health conditions ?
If it is not renewable.. that means you will need another policy at a older age. And it ain;t gonna be cheap.
What happens if you are diagnosed with some illness.. will the insurance company be willing to extend the coverage ?
Frankly.. I don't really care how the agents are being paid.. they can push certain policies.. ultimately.. it is my needs and financial ability that will decide which policy I will purchase.
You can seek advise from the agents... but ALWAYS.. read up on the prints and understand the terms and what it covers ... yourself.
And remember.. Insurance is not an Investment. It is an instrument to ensure your spouse/family be financially taken care of.. if you depart..(at a cost.. the premiums)
Typically.. young people will go for term.. because it's probably cheaper than life/annuities. So you decide, base on your financial ability.
Term is always better than Life or endowment regardless of age.
How does insurance companies make money?
The insurance company invests the money in the stock market and earns 9-12% and gives the policy holders 4-5%.
The insurance company makes the difference between the yields it earns and what it pays to policy holders.
The difference in returns over a span of 20 years, the usual lock in period for insurance savings plan, is huge.
Insurance
$10,0000 at the yield of 5% compounded yields about $265000 after 20 years. ( 1.05^20 = 2.65329771)
Stocks
$100000 at the yield of 9% coumpunded yields $560000,(1.09^20 = 5.60441077)
Stocks as seen, yields twice of insurance. Whiles stocks are usually more volalitle, a regular savings plan would even out over a period of 20 years.Basically, that is depriving the insurance companies of the profits they usually make.
Hence its always better to buy term insurance and use rest of the savings to invest in a dollar averaging plan for stocks than to buy regular insurance savings plan.
I always use this argument to put off pesky agents and without fail i get them off my back.
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Originally posted by kilua:
Term is always better than Life or endowment regardless of age.
How does insurance companies make money?
The insurance company invests the money in the stock market and earns 9-12% and gives the policy holders 4-5%.
The insurance company makes the difference between the yields it earns and what it pays to policy holders.
The difference in returns over a span of 20 years, the usual lock in period for insurance savings plan, is huge.
Insurance
$10,0000 at the yield of 5% compounded yields about $265000 after 20 years. ( 1.05^20 = 2.65329771)
Stocks
$100000 at the yield of 9% coumpunded yields $560000,(1.09^20 = 5.60441077)
Stocks as seen, yields twice of insurance. Whiles stocks are usually more volalitle, a regular savings plan would even out over a period of 20 years.Basically, that is depriving the insurance companies of the profits they usually make.
Hence its always better to buy term insurance and use rest of the savings to invest in a dollar averaging plan for stocks than to buy regular insurance savings plan.
I always use this argument to put off pesky agents and without fail i get them off my back.
I agree that term is a better policy for people who are Investment savvy.
But how many of us are really ?
The one pros about life policy is that you lock in a low premium rate while you are young.
With stocks, there's always the risk factor. By the time your term expires, you have to make sure you've got enough accumulated savings to make term worth the risk.
Me being a female.. never like to take too much risk. We tend to be more provident...so low risk, low yield is almost.. always a standard M.O. Slow and steady..
Personally, I think, while you are still young and healthy, it's better to get comprehensive health coverage that will last you a lifetime.. rather than a policy that's only useful upon your departure. Although it will be ideal if you have both when your liabilities builds up.
With agents.. I usually politely tell them I know what I need, I'd give them a call should I require more information.
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Originally posted by january:
Thanks for feedback!!
Mine is life insurance type. I think there is a break even period of around 15 to 20 years where you can get back in cash the amount of premium u have put in over the long years. Am i Right?
I dun want be pay for life insurance where I cannot get much of the premium back after lets say 20 years when I want to end the insurance. I dun really intend to pay until I die and then let the money go to my kins because I need to spend it in the future. I noe I very money face. hehe
I think its what they always call the surrender value or cash value of your insurance which how much your insurance is worth if you terminate the policy to get cash.
I think you are talking about life annuities ? Perhaps you need to look at your document to ascertain it.
But basically, you have a misconception about insurance. Don't be taken in by agents claiming you can earn money from insurance policies.
Insurance is an instrument you (rent).
With life, part of your premium goes into the cost of coverage.
Part of it goes into the funds Insurance companies use to re-invest to gain yields.
At the point of "break-even".. you stop paying the premiums. and that's when the accumulated yield from your premium goes to pay for the rest of your coverage till YOU expire.
or/and it becomes part or your "cash value" which you can draw on later.
Term policy is the most basic form of insurance which is why it's cheaper. You only pay for the cost of coverage. Therefore you don't get any "returns".
So if you want to go term.. take a longer term policy and pay just the cost of coverage till you get your other retirement fund.
Right now.. I reckon you must be single so, you have no intention of leaving anything behind.. But.. once you have your own family, you will need to relook into this coverage and re-adjust your insurance needs.
For termination... I think you betta check again.. because I'm not sure if you can get anything back.. if you didn't have the policy for very long.
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Originally posted by jojobeach:
I agree that term is a better policy for people who are Investment savvy.
But how many of us are really ?
The one pros about life policy is that you lock in a low premium rate while you are young.
With stocks, there's always the risk factor. By the time your term expires, you have to make sure you've got enough accumulated savings to make term worth the risk.
Me being a female.. never like to take too much risk. We tend to be more provident...so low risk, low yield is almost.. always a standard M.O. Slow and steady..
Personally, I think, while you are still young and healthy, it's better to get comprehensive health coverage that will last you a lifetime.. rather than a policy that's only useful upon your departure. Although it will be ideal if you have both when your liabilities builds up.
With agents.. I usually politely tell them I know what I need, I'd give them a call should I require more information.
I agree that getting comprehnesive health insurance (medishield) is very important and a forced insurance savings plan could be better if there is lacking in commitment and discipline to a regular investment plan.
But one doesnt have to be investment savy to achieve a conservative 8-9% return if they get a financial planner, especially an independent one. Paying $100-$200 for indepentdent financial advice would save them a pile than getting advice from those "free" commisioned based agents. Sadly, most wont be willing to pay for such advice when there are "free" ones around.
Many agents wont hesistate to push a product with higher commision, even if they say they would act in the clients interest. I worked in sales too so i know how lop sided recommendations can be when it comes to pushing products to customers. I am never nice to agents because i know they always push products against the clients interest, even if they are your good friends.Working in the industry would turn them into sales target meeting machines.
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When can you get your money back, the straight answer is only when you die, if you don't die, then you pay until you accumulate enough cash value for the policy to pay itself, you can also borrow money from the cash value.
The other answer to your question of When can you get your money back is How much money have you paid? If you only paid premium for 2 to 3 years, then it is money spent to protect you over these 2 to 3 years, if you stop paying, policy lapses, no money.
Where is your agent? Insurance today is developed with many different products with varying level of investment and protection. Besides life insurance, endowment, there are unit trust, critical illness, ..... A normal people, especially without financial background will find it difficult to understand all these products, what it protects, its returns, cash values.... Today even the bank is selling because the bank knows that you have FD....
Suggest you find a good agent, don't just look for the young and pretty ones, chances of them staying around in the industry is not long. Insurance agent is supposed to do financial analysis on your case before coming up with recommendation on what you need, it is not what you want. Then it is up to you to decide.
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i know the cash value is extememly low for first ten years.
But i am looking at getting back money , at least a sizeable portion compared to the premium paid, after 15 to 20 years.
For example, my ntucincome maturity date is 2067, and it has already been paid premium for 15 years.
My surrender value for it now is around 4000 which is near to the total premium paid so far.
Therefore, i conclude that my other policy, like prudential , behaves similarily also. I am expecting to get back the money, at least near break even amount, after 15 years.
If I cannot get any money until I die then the money goes to kins, then I will definietly terminate the policy, because I need money for investment or business purpose.
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for my prudential, i have requested for my policy info.
At the revised benefit illustraition. It show me my non guaranteed cash value column, my guaranteed sum assured and death benefit.
with annual premium of 1200, after 8 years of paying, my non guaranteed cash value will be 5600, which is low compared to the premium paid.
however, after 18 year, the cash value becomes 19400, which is closer to the total premium paid. Moreover, the 19400 is at a 5% growth. My is investment linked. If the gorwht is 9%, the the cash value become 27000.
Anyway, I know it is best to call up and ask the idiot directly.. thanks so far for all your contributions. I have actually asked many times over the phone before. I just that I forget abit liao and I am also unsure of those terms..... I have even asked them to send me details also....
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I disagree with sgdiehard that the only time you will get your money back is when you die. I doubt he knows about insurance. Am i right???
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After much thinking, I think that most life insurance is meant to be paid until you die. SO that in case you die in the future, your family can received the money.
If I try to cash out money after the lets say 20 years. Then, the family cannot get money, if i should die after cashing out the money and ending the policy.
SO i guess life insurance is meant to be paid throughout your life and the benefits will go to your kins at the end of the day.
Does it mean that life insurance = benefits/protection for family members thing??? Its the conclusion I seem to arrive.
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january,
SGdiehard may not be wrong. It depends on what kind of policy you bought and how long have you kept this policy.
Term/life policies are good. The purpose if to ensure your immediate family don't fall into financial difficulties should you have an unplanned departure.
Also... your parents spent so much raising you up. Your schoolings and other daily neccesities also cost money. If you put them as beneficiaries.. and God calls you to join him.. they will loss a child.. but they at least get some financial consolation.
I purchase one .. so if I pass to the other world.. my parents effort will not be 100% gone. I know that with the money.. they can somewhat.. use the money to take care of themselves since I am no longer around.
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Originally posted by kilua:
I agree that getting comprehnesive health insurance (medishield) is very important and a forced insurance savings plan could be better if there is lacking in commitment and discipline to a regular investment plan.
But one doesnt have to be investment savy to achieve a conservative 8-9% return if they get a financial planner, especially an independent one. Paying $100-$200 for indepentdent financial advice would save them a pile than getting advice from those "free" commisioned based agents. Sadly, most wont be willing to pay for such advice when there are "free" ones around.
Many agents wont hesistate to push a product with higher commision, even if they say they would act in the clients interest. I worked in sales too so i know how lop sided recommendations can be when it comes to pushing products to customers. I am never nice to agents because i know they always push products against the clients interest, even if they are your good friends.Working in the industry would turn them into sales target meeting machines.
kilua, can I have your msn to ask you more about term investment and the compounded interest thing? I would like to learn more... Recently got interest in such things seeking more opinions and advice...
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Originally posted by january:
i pay premium to prudential every month. when can i get it back if i dun die so fast.
i prefer to use the money for investing or spending leh...
put there then when can get back, especially if i dun die prematurely....
someone pls enlighten me.
Wrong topic.
Sorry.
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People can share their experience here in this forum.
Everyone has their own expertise.
Everyone can gain from this exchange of knowledge.
You help me, I help you.
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Originally posted by january:
with annual premium of 1200, after 8 years of paying, my non guaranteed cash value will be 5600, which is low compared to the premium paid.
however, after 18 year, the cash value becomes 19400, which is closer to the total premium paid. Moreover, the 19400 is at a 5% growth. My is investment linked. If the gorwht is 9%, the the cash value become 27000.
that's insurance lorthe initial phase you get little capital value in your account
because insurance companies also need to cover the event that you die
and they have to end up paying your insured sum
but as you progress further when you built up the capital value
you will be able to get more cash back
insurance is just a way of diversifying risk
what insurance companies do is to invest your contributions in the market
i don't like insurance companies.
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I guess that it boils down into 2 choices... SHould I protect and contribute to my family by continuing the payments until i die so that they can receive the death benefits....
Or should i cash out the money after a few decades and use them to enjoy my life.
Its become a moral situation it seems... I think I prefer the latter, espeically, if I dun have alot of money... i guess i am selfish then.. only thinking about myself...
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personally, i quite wizard...
buying a insurance is a responsiblity to family and kins.... the correct way actually is a , personally, i believe is this, you guys are lucky...
buy a term policy because it is used purely for protection purpose... with higher assurance... but you cannot get money...
During the period where you paying this term policy... you must accumulate alot of savings, learn alot about life and money to ensure you reach financial independent as quickly as possible.
Once you reach become quite rich, you do not need a single policy or insurance... rich i mean is about 3 to 5 million. And for smart people, it does not take long to reach this amount by investing or doing business..