QUOTE(adele123 @ Feb 24 2016, 06:50 PM)
Actually this HLA EverGain Plus is an investment-linked insurance policy. Hence the point I) and II) doesn't apply in this case. not that i disagree, just wrong situation.
Yeah, noted. My earlier posting is more of a general post, not specifically targeted to HLA EverGain.
Now, wrt to ILI saving plan, my comments are as follows:
I) Since we are talking about Investment, I shall now compare to pure UT.
II) In ILI product, you need to pay multiple charges that pure UT do not need to. On top of paying for the fund management charges aka Management expenses (which both ILI & pure UT will be levied upon), ILI product also need to pay additionally:
a) Cost of Insurance because ILI is an insurance product.
b) Monthly admin charge of RM 6.00 or RM5.00 - WTF is this for?
c) Cost of Rider - if any.
More often than not, the Insurance company will outsource the management of the fund to 3rd party anyway.
III) If you are thinking of using ILI product for investment, all the expenses incurred from a) to c) will drag its performance down.
With the above points stated, now I will give a balanced view on why and who should buy ILI products:
IV) ILI biggest advantage to me is the low entry barrier. Meaning if you are young, you can actually buy a large coverage for a relatively low premium vis-à-vis traditional product. The rational is that the insurance company take a calculated risk that your future cash value can sustain paying the cost of insurance in the future provided you do not prematurely sell your units.
In simple English, by paying small amount of premium earlier on, where a portion of it is used to invest into your UT of choice, hopefully the UT can generate enough return to offset future more expensive Cost of Insurance without the Insurance Company asking you to pay more.
V) ILI insurance is suitable for young people who due to low income whom may wish to transfer their mortality and morbidity risk to a insurer for relatively lower cost.
Xuzen
This post has been edited by xuzen: Feb 25 2016, 12:24 PM