I agree, but thanks to the agent, she brainwashed my old people into thinking they give 20% returns annually

What is the % of yearly premium paid goes to investment and coverage ? If will be more on the coverage if the entry age is older and vice versa. It may still be about 20% but on a lower investment amount.

I also have two life and medical policies from HLA bought more than 20 years ago. For the past 5 years, I am getting yearly cash dividends of about 70% premium paid.

Agreed, they just disgust themselves as investment, but the cost of insurance erodes all the possible returns. Nothing different between so-called investment and conventional life insurance,

Got factor in non-guaranteed return also. So far the non guaranteed returns still ok, got drop but still good + the interest on existing bonus/dividend still ok. We know the interest also non-guaranteed but i think overall still ok la. We calculated this based on pre covid interest la. During 2020 and 2021 then return much better compared to FD.

My only unhappiness was the premium of the policy was quite high. Luckily we started paying few years into working, if fresh grad, then die liao.

But if yours does not give you decent return, then yup, say bye bye la. The thing is alot of the cost you already paid for jor. I also believe sometimes if you have to cut loss, then you have to.

I have to caveat that we assumed based on the current moment, what we pay now and what we will continue to get and vs keeping it but not paying vs cancelling it entirely. This decision may change if interest goes really high or aia cut bonus/dividend then possibly not worth in continuing long term. For now, we keep.

Our HLA cash promise works a different way, my parents invested 10k each year across 6 years and they promised 20% guaranteed returns which is 2k every year across 25 years.

However, the initial Investments into the policy every year its surrender value is different (we are at the 8th year) starting from 0 all toward around 3k now at the 8th year. + Non guaranteed returns and other small stuff that they provide.

Overall, my parents policy is still on negative 2k. after 8 years into this policy despite not withdrawing the interest. If I'm not mistaken last year total surrender value was also around the same at 58kdue to the fluctuations in their non guaranteed returns.

Albeit having life insurance, stated only 2k in their annual sum assured?? So like a very funny policy

the plan is a participating plan.at least that's what the insurance ppl call it. There is no real differentiation on how much goes to investment and insurance protection. Does not work that way. Usually such plans have very low coverage amount


I cant recall exactly but it should be stated in your contract upon death, what will be paid. It should not be the 2000. In theory the insurance company will at least pay you the premium you paid so far, upon death. It's weird to the general layman but i can tell you spent time going through it.

Yes, I spent some hours going through this from when I was still studying in uni as my parents subscribe to this plan. Did not have much time and knowledge back then, and I despise these sales pitch that overpromise something that is too good to be true.. unfortunately my parents were not literate and they will not read through black and white before signing these , which is an easy target for them, they always target those lower-middle income families..both my parents are blue collar and work their asses off and they were sweet talked by them to withdraw from EPF to invest in these plans that has no returns.

How I wish those money that they had not touch were remain in their EPF and was compounded through 8 years and we will be in a much better place now. Oh well, just got to rebound back stronger 💪

Thank you for your advise, I'll have to dig back those policies and check back on their life insurance. But from what is online in their portal they are showing 2k only which am not sure why 😐

This post has been edited by HumbleBF: Jan 9 2023, 11:43 PM

Generally all insurance companies have a minimum sum assured for their products, not sure what is HLA's minimum then.

But likely the servicing agent sold the 20% annual return to your parents and not life insurance per-se, hence the small (minimum?) sum assured.

In term of the saving plan normally what I will do is calculating Premium interest as if I put into bank, assuming a fix interest rate eg 4% all years, including compound interest generated. Example 10k each year continuous 5 year premium, coverage of 25 years, take into account of policy fees, via this method you will surprise that you can find the worst and best plan in the market, the worst plan normally comes from the top market company while the best from not so popular company, but whose care so long the company is BNM legalized funding company and under the coverage of PIDM. I more prefer non-participate plan and probably with slight % of investment instrument, as I want to be more comfortable on the long term return.

Based on what I heard from relatives who had bad experiences with HLA and also the ones shared by fellow forummers here, I honestly think it's an easy trap for senior citizens thanks to the sweet promises made by agents.

Personally I'm not sure what kind of "investment" that my relatives invested in HLA, but one thing for sure is if you're not rich, avoid these at all costs because you'll never know when you need the money, once you need the money due to urgency and it still hasn't reached maturity yet then you're guaranteed to lose most of the money.

Agents will do whatever they can to lure you into the trap as long as they can earn commission and get promoted, once you realized you fell into the trap, it's already too late because what they will tell you is that "you signed and understood the T&C".

Better stay away if you don't understand what is it all about in the first place, I don't understand much and wouldn't wanna understand either, there are much better places to invest with flexibility and freedom.

This post has been edited by xperiaDROID: Jan 11 2023, 12:34 AM

It's an endowment insurance product.

1. You need to know how to calculate the IRR (annualized ROI) of the yearly cash flows going into HLA and coming back out into your pockets for the entire lock-in period to know if it's better or worse than your other 25-year investment plans with similar lock-in periods. e.g. if the IRR is 2-4% ask yourself if it's worth locking in the bulk of your cash for 25 years, because if you surrender early you tend to lose money.

2. The 20% return is only for the first year and to be honest it's just your own money being handed back to you. By the second year, HLA has collected 200% and is giving back a nominal 10% of the total collected from you. The third year they are giving back a nominal 6.67%, etc. etc. It's an optical illusion, and going back to IRR for the series of cold, hard cash flows over the years until maturity is the right way to calculate your actual ROI.

3. The only guaranteed payouts is the annual payout for 25 years, and a final amount upon maturity, which is a multiple of your annual payout amounts, based on your age of entry (between 10X to 12.5X). Example, if you had deposited RM10k each for 6 years (total RM60k), you will get back RM2k each year for 25 years and a final payout of RM25k (total RM75k) after 25 long years. Everything else is non guaranteed.

These products could offer and even guarantee higher base returns, but there are deductions for agent commissions, management fees, etc., and then all of the non-guaranteed side of the returns and risks have been passed to you to bear, instead of the insurance company.

Not recommended.

As usual many agents they just want their commission, not many will tell us the actual return, they just let us see the return on their own calculation sheet because of 2 reasons, first not many will know how to see the policy illustration, Second they don't want us to understand.

For investment or participant product, many on paper calculation are based on the y assumption, I would say 98% agent will do that, as this will let us see the top notch return that approved by bnm (5%), as the actual fact x (2%) and y (5%) are all projection.

If anyone plan to take up insurance saving or endowment plan have to learn to see quotation illustration, and run through all the term and condition, afterall this is 10 or 20 years plan worth for us to spend time read. Many don't request full quotation from agent because they don't know have such of thing, and if we not ask for it trust me agent won't give, and it's our right to get the full quotation illustration from agent before we commit, so asked for it and it's ruled out by bnm they must give.

Some agent said we will have it when we pay for the policy and we still have 15 days of free look period, but why troublesome ourselves if we can get the quotation and make up decision before we pay.

Policy's return uncertainty only appears when we take up ILP or participant product, if you want to be solid virtualized return where now you already know the future pay out, take the non-participant plan.

One if don't understand the illustration or too lazy to read it's term and condition, and not do detail self calculation of return, suggest don't take up this type of policy, as 90% policy out there will only get you back 60-70% value worth of premium paid, when worth of premium paid, that's including compounding interests, there are very few given more than 90% but they do have, and of course need to take into account of insurance fees too.