Thank you for your advice.

Just make sure to maintain your annual premium payments as per the level premium payment schedule set at the policy's inception. -> I was thinking to not even pay this premium and force deduction of any cost from my cash value and only top up years later when cash value is low....

If you go down this path, then you might not be able make the case to the ITO that the contract is not performing in line with your expectations. You will be paying more as the cost of insurance and other policy charges can be very high.

Prior to this, premiums were priced at an affordable level due to the discount rate implied in IL premiums by accounting for future investment returns.

The cost benefit may work in your favour if you maintain the annual premium payments instead of just topping up when the policy is about to lapse.

High investment return assumption = low annual premium
Low investment return assumption = high annual premium

just sharing...
i basically did exactly what you planned to do. Cancelled my auto debit late last month. So this month my insurance provider will deduct the medical cost from the portfolio/cash value.
It just doesn't make sense that that I had to increase the premium payment by 10% when the medical cost only went up by 5%. Truly makes no sense.

I also verified with the CS of my insurance provider, that one can always top-up the investment of the ILP in the future... just have a service fee of 5% (this could just be my provider). I'll do so in 10 years time.

My request for policy alteration has been denied for using an incorrect "old" service request form.

The bloody idiots, I got it from your own website!

Plus, it's a basic request and there is no material difference in the forms.

Why are they linking to and hosting outdated versions of the forms on their website?

I don't have a printer anymore and don't wanna go get a witness signature again. There is no material differences in the form, at least not in the portions applicable to my request. What are my options? Can I compel them to process it and threaten to complaint to BNM if they refuse? Feels like so wasting my time only.

This post has been edited by contestchris: Apr 18 2025, 09:27 PM

Is it the consent form? As policy alteration itself can be requested online (no need document unless its consent form)
I also downloaded from their link. Dont tell I also got the wrong version

Just beware of the possible amount that they may ask you to top up when the value inside your policy are depleting after a prolonged time in order to keep sustaining the policy.

Attached is just an example, may not be applicable to you


This post has been edited by MUM: Apr 19 2025, 08:03 AM


Attached thumbnail(s)

Although there is word of "depletion after a prolonged time in order to keep sustaining the policy" but at same time, my contract has words like "if the Total Investment Value is less than or equal to zero" in LAPSE AND REINSTATEMENT part, so i guess they cannot lapse my policy due to depletion of TIV even though my TIV/cash value is not 0 yet?

Hope that the depletion is not at the time when you are at or near the time that you are in need of the coverage.

Or they may not issue a GL if they think that the duration for that medical treatment may last longer than the potential depletion of the investment value thus caused your policy to lapse.
They may tell you to Pay and claim later (medical bills n expenses till before policy lapsed?)

This post has been edited by MUM: Apr 19 2025, 10:47 AM

tqvm for the warning.

curious... when they sent this letter to you, was the TIV almost at zero or roughly could not cover that year's (2023?) medical card fee?

the CS of my provider did say something along that line, but even she is not sure of the formula. I took her words in good faith, and hence the plan to topup in 10 years time. Cos the cash/portfolio/TIV in my ILP can cover like 15 so years of the medical card fee (even after the cost increase for this year... the cost increase was just like 5% while they demand a 10% increase on the entire ILP premium).

From the 1st sentence of that letter they sent me, it mentioned "had lapsed" due to depletion of ........
I did not check or seek proof of it.

I’ve got a basic life with medical on it from GE, and it is an investment link plan since 2017.

Agent tells me that the premium contribution would be level until I’m 100 years old as that’s what the investment portion does — to keep it level.

There’s been a premium increase of 20% 2 years back due to lack of funds or whatever and cannot sustain, and agent moved me to a new pool because I have not claimed anything. That’s what the agent said lah. To me, I’m like okay. This increase did give a bit extra benefits like higher limit which I don’t really care… I’m happy with the existing limit.

Now I am curious
1. Is that level premium contribution legit? Like does such a thing exist and really work?
2. I genuinely don’t care about life insurance. My main need is medical coverage esp. when I am old, retired and jobless.
3. Does GE have deductible medical coverage? Per annum? I don’t mind having deductible of RM1k ~ RM3k. Got company coverage, and I can still afford RM3k/year after retirement.


Edit: don’t really want to talk to my agent. I don’t want to Kena upsell. If anything I want to add on deductible to pull the premium down.

Edit2
hafizmamak85 thanks for sharing
Interesting read. Based on your info, all ITOs are evil. So who is the least evil where I can get guaranteed renewal up to 100 years old. With a premium that would not be raised at the whim and fancy of the ITO? It looks like we do not have a choice and at their mercy?

This post has been edited by Jason: Apr 20 2025, 03:25 AM

Answering your question.
1) the level premium is legit if you assume medical inflation remains zero which is impossible. So the answer, nope not legit.

2) no solution.

3) should ask your agent. But based on older plan, usually low or no deductible. But GE current on shelf plan has 2.5k and 5k.

Just a reminder that ITOs are for-profit companies but it is also heavily regulated. If by this definition, then banks are evil too.

Will ITOs continue to raise prices? Ya, if medical claims continue to increase. After all, the ITOs are not in it to run a losing money business. What you hope is they work hard to pay the right claims, catch the customers who make fraudulent claims. Which one? Dunno…

Can sustain only 100 years old is only a dream. If you see the projection table by the insurance company at 2%p.a and 5% p.a (as mandated by BNM) you can see that in actual fact it cannot sustain until 100 years old. Some where down the line 70-80y time, your ILP will run of of cash value. If you don't inject say say 50-100k of cash, no way it can sustain you.

Remember with ILP you are paying the insurance to invest for you to actually able to sustain you until the age require. For them to do that they need to invest to get about the 5%p a rate consistently. Can that happen? I don't know. I have look though lots of ILP and majority can't even match EPF returns, so you tell me.

That's why I don't bother with ILP but rather than let them invest for me, I invest it myself and just buy pure insurance. No investment part from them as I feel it's not worth me paying them money if they cannot even generate a decent return. Basically in plain English why pay them when you can do a better job yourself.

If you haven't claim, you are still in luck as you can still buy standalone. Standalone is just plain insurance without the rubbish investment. You take the savings and dump it into EPF which will generate better returns than whatever the insurance company can do.

Your choice.

Thanks
1) Then they SHOULD not be allowed to sell ILPs saying that it will sustain the premium over the years. Knowing the answer is no due to inflation. Misrepresentation. Banks are evil but if they say you’re going to get 4% returns on your 20 year FD placement, regardless of the state of economy, in year 15 you will still get 4%! But this isn’t the case for insurance. wtf BNM

2) 😂

3) problem with agents, every time see them also wanna increase. I don’t want to increase I want to retire. Which means optimization of my expenses. Clearly agents are NOT ALIGNED to MY NEEDS. They just want to increase the premium for their pockets.

Which standalone direct to consumer medical insurance can cover up to 80? Or 100? With an annual limit of min ~RM1m and no lifetime limit. With guaranteed renewal?

The issue I have, reading the fine print, is that they start your policy at age 40, but there’s no guaranteed renewal, then they drop you off at 60 despite you have 0 claims. Then you are fked.

I’ve been looking at all the direct to consumer ones… we don’t really have many choices.

My goal is never having to use the insurance until the day I die. I think policies with >RM5 million annual coverage is perpetuating the issue of rising medical costs and stupid. Bloody hell if you need to spend RM5 million on medical bills in a year you’re probably bionic man already with all the work done to you. I rather go YOLO and live the last of my days than to be bedridden, pissing myself off and either in pain or high as a kite.

Only few companies have standalone medical up to RM1m coverage.
1) AIA
2) GE
3) Generali
4) lonpac -medisavers vip

Can email GE customer service. They should be able address easily since your question not a complicated one.

You, the consumers, do have a choice. You are not at their mercy. You can always band together and haul the ITOs to court for contract non-performance and unfair/unreasonable contract practices. The sorry state of affairs in Malaysia means most, if not all, ITOs have such similar unfair/unreasonable practices.

Closing medical pools every three to four years when utilisation gets near to or breaches 10%, and subsequently opening new ones with better coverage (higher annual/lifetime limits, better inner limits coverage), is nothing but a sham excuse to reel 'healthy' consumers like yourself - those who don't make claims - in from older pools and to re-price the IL annual premiums and medical rider coverage cost of insurance charges.

My bet is that the ITOs are doing this to correct for their initial pricing errors (mispricing/underpricing), the ones that occured during the policies' inception, and to maintain their profit margins. That is not to say that there is no legitimate need for higher annual or lifetime limits, or better inner limits, for that matter.

The limits may seem ridiculous, but will come in handy if advanced treatments (e.g. cell, tissue, gene therapy treatments) are covered and utilized. The question is, while most medical insurance/takaful products with high annual limits must cover such medically necessary treatments/procedures, do our ITOs do so in practice or do they employ deny and delay claims tactics???

Great Eastern's current average medical pool claims cost per policyholder is less than RM 800 - which I think tallies more or less with the LIAM industry average. Prudential's PruHealth is around RM 1.1k. Malaysia's health expenditure per capita in 2023 was around RM 2.5k and is growing at an annual rate of 6%. Let's assume that around RM 1.7 to 1.8k per capita goes to hospitals/specialists for medically necessary treatments/procedures. That's more than a 100% difference when compared to GE's average pool claims cost. For Pru, it's more than a 60% difference.

How many more re-pricing cycles are Malaysian insurance/takaful consumers expected to endure before the average medical pool claims cost can at least catch up to the per capita health expenditure component for hospitals/specialists???

Bear in mind that the current average IL policy annual premium is already above RM 4.4k and there are more than 7 million IL policies paying around RM 29 billion in annual premiums.

You can easily design and price an insurance/takaful product with RM 200k in death and disability benefits, RM 3.1k in average medical pool claims cost, all for RM 4.2k - has a 40% expense/profit margin for the death and disability components and a 5% expense margin for the medical component. RM 3.1k is almost 4 times as high as GE's average pool claims cost.



You are right to point out that the ITO only wants you for the sweet spot years of between 25 and 55. Their products are, in my view, intentionally designed to not be able to meet your reasonable expectations of policy sustainability and meaningful coverage. They basically want policyholders to leave after the age of 55 and have intentionally jacked up the medical coverage cost of insurance charges after that age which, as you are well aware, the annual premiums will find difficultly in sustaining. Another trick is to mostly allow small medical claims to go through while denying/delaying a significant proportion of large claims. Above 60 lives currently only constitute less than 15% of the total population. Even if we assume a 30% proportion of claimants for this cohort, the average proportion of claimants for the total population will still only be less than 12% if we assume those below 60 have an 8% proportion of claimants. And the RM 4.2k policy is good enough to cover 12.1% proportion of claimants with an average bill size of RM 25.4k.

Your expectation as an IL policyholder of annual premium sustainability is legit. It's just natural to expect ITOs to price a long term contract with level premiums such that its sustainability until the end of the contract term is ensured. You're not an expert nor have you any accountability when it comes to premium pricing, determining long term medical inflation or investment returns.

Short of expecting the digital ITOs to collaborate with hospitals/specialists in coming up with better product propositions, your best bet is to sue the ITOs & BNM.




Fun fact. Malaysian actuaries usually use a slapdash approach when it comes determining 'reasonable estimates' of long term investment returns in pricing IL level premiums. Two key ingredients: past investment return performance and future expectation of investment returns. Past performance is basically a review of the geometric average annual investment return for the 3yr, 5yr, 10yr and 20yr (if available) periods and prior to this, especially for IL pricing, it would be settled based on the 10 yr equity fund or total return equity index geometric average annual return. Since no one in the investment team would have had the chops or gumption to have any long term view or expectation in relation to equity performance, the assessment was basically limited to this review of historical returns. This was how we ended up having IL annual premiums priced assuming 7%, 8%, 9%, 10%, 11% annual returns for policies with terms of over 30 years.

This brings up an interesting question. Why were actuaries comfortable with imputing a certain investment return expectation - why not 0%? - for the entire duration of the contract in pricing IL level premiums, even though they have had an abysmal run at predicting the long term performance of IL equity funds, but were not comfortable with imputing a certain medical inflation expectation for the entire duration of the IL contract, even though the forecasting signal fidelity from the persistent 6% growth in per capita health expenditure could have been argued to be much stronger???

» Click to show Spoiler - click again to hide... «

Could it be because assuming higher investment return performance for the entire policy term meant lower annual premiums while assuming medical inflation for the entire term meant higher annual premiums???



This post has been edited by hafizmamak85: Apr 20 2025, 11:51 PM

Through agents? If possible I want to bypass agent and save on comm. Which company you bought for medical?

It took 61 years for Malaysia to change government, driven by the people. I don't think I will live to see the day ITOs and BNM getting sued. Rule of 78 is outright illegal and banned in many countries including UK, Australia and New Zealand, and even Singapore. BNM talk about abolishing it for years, bila? Not practical lah boss. I don't have 60 years to wait for it to happen.

You can champion that, I will support you, but while that is happening I need to address my current issue first, which is my insurance.

Simple maths to me, you sell me insurance with RM1 mil annual limit, with X premium for Y years. Actually medical cost increase got nothing to do with me and my insurance policy. So what if surgery for knee increase from RM20k to RM60k? It still falls within the RM1 mil annual limit of MY POLICY, you cover lah.

But what you are saying, insurance companies actually give RM1 mil annual limit with no intention of covering actual RM1 mil. So they sell plan on paper but with no actual money to back it. That's called a Ponzi scheme... when not enough $$$ you squeeze your customers to put more money in the pot. That's actually what's happening now lol.

They have the money, they just choose not cover all these large claims so that they can have high profits and expense (commissions and management) structures in place. That is where the money is going. Of course, goes without saying there is also the useless cash value component which will be insufficient to meet future cost of insurance charges.

The way I look at it... and the result of such a policy to a policyholder such as myself.. scam Ponzi lah. That is the end result. Some people can claim, but when most people claim the whole thing falls apart. Isn't that a Ponzi?

You put lipstick on a pig it is still a pig... put a dress and tiara on it, still a pig... no difference still haram. You dress it up with pretty product disclosure sheet and tell me ILP is to sustain, but after few years tell me cannot sustain, means you failed at the job you promised to do.

Likewise if bank can tell me give me 4% on my 20 year FD cert then year 5 tell me cannot give me 4%? Cannot right? The bank cannot make money on the funds I place in FD is not my problem. That is the bank's problem.

Tapi this insurance is "scam" bertauliah. No wonder insurance agents and the companies all kaya raya.