Direct Purchase Insurance (DPI) Whole Life?

Direct Purchase Insurance (DPI) are term life and whole life insurance products that you can buy directly from the insurers without requiring a financial adviser. They are definitely cheaper as there is no middleman. The premium goes directly to the insurer companies, with no sales commission nor processing fees.

However, there are some factors that you should consider before buying DPI.

1. Understanding of Product

Financial advisers are there to help you make an informed decision.

They possess a good knowledge of the product and a good adviser will be able to provide good recommendations and help you understand your financial situation. Thus, it is essential to ensure that you have done thorough research on the product if you opt for DPI.

2. Claim Process

The lack of a financial adviser can also complicate the claim process should disaster strike. You will be required to prepare the paperwork and liaise with the insurer directly - which might not be ideal given the situation.

3. Sum Assured

There is a limit for the Sum Assured of S$400,000 per insurer, with a sub-limit of S$200,000 for whole life DPI. You can, however, choose to buy more coverage through DPI, from another insurer (with declaration).

Do get in touch with us if you require more information.

Hi Will,

Plenty of differences. To summarise:

Direct Whole Life

• Premium terms only have 2 options: Till 70 or till 85

• Premium mode: Only Annual

• Have a very limited range of coverage: Only allowed to buy $50K, $100K, $200K sum assured

• CI riders only cover late CI, and only 30 conditions

• No coverage on special benefits or juvenile conditions (e.g. diabetic complications, osteoporosis)

• No multiplier allowed (this is one of the biggest problems I feel)

• No servicing agent, however this is a minor issue. When you want to make a claim, you or your family members will find the time to go down and do so

Non-Direct Whole Life

• Premium terms: Plenty. You can customize it so that you only need to pay during your working years and you'll be done paying by, say, 60.

• Premium mode: Monthly allowed. Some people prefer this to manage cashflow better

• Sum assured can be almost any amount, subject to financial underwriting and maximum limits

• CI riders cover at least the standard LIA CI, and early CI riders will give you many covered condition (120 to 130 conditions, depending on insurer)

• Coverage for special benefits or juvenile conditions (e.g. diabetic complications, osteoporosis) which will not affect the main plan payout

• Multiplier allowed