for investment linked type of insurance, its always better to pay monthly.
Your agents probably wants you to pay yearly cos he/she can get the commission as a lumpsum for the year...

Why you should pay monthly and not yearly:

1. Dollar Cost Averaging. You will not be having the risk of buying the funds at a high price, and end up not buying the fund when its at a low price. if you truly understand the fundamental of ILPs, you will know why this is important. with DCA, you get to buy more units at lower price, and less unit when prices are higher. overall, you get to maintain a balanced portfolio without making losses.
However, this is for long term investment only.

2. ILP polices have no have no interest chargeable for monthly payment, so might as well take advantage of that.

3. When you pay monthly, you get to know if your agent's still around to service you.

but personally, I feel ILPs to be a very weak product, as its non-guaranteed, and consumers have to accept the financial risks.