Insurance Policy Values & Figures

Policy Values & Figures

This Chapter explains the types of values and figures that can be found in relation to insurance policy and what these figures represents which helps you have a better understanding in comprehending your policy documents and illustrations.

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Premium – The amount to pay for an insurance policy. Premiums can be regularly payable in frequency of monthly, quarterly or yearly. Single premium is just a one-time payment required to service the policy.

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Sum Assured – The coverage amount which would be paid out to the in the event of claim due to unfortunate event to the life insured.

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Reversionary Bonus – The bonus sum amount declared yearly and added to your sum assured, forming part of your policy’s guaranteed value. It is only receivable upon maturity or claim made.

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Accumulated Reversionary Bonus – The accumulated bonus amount in the event the policy is surrendered pre-maturely.

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Terminal Bonus – The bonus payable when your policy reaches maturity, when you surrender the policy or upon a claim. It is typically one-off and a proportion of the total accumulated bonus to date.

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Guaranteed Value – The guaranteed amount that forms part of the total value in the event death benefit is paid out or the policy is being surrendered.

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Non-guaranteed value – The value that forms the other half of your total gross death benefit amount or gross surrender value. This amount is built up over years of premium payment, dependant on the market scenarios or investment performance of your policy.

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Gross Death Benefit – The amount payable upon death of the insured, before deduction of policy loan owing and/or any other adjustments

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Gross Surrender Value – The surrender amount receivable, in the event the policy is being surrendered early, excluding the account of policy loans deductible, accumulated reversionary bonus till date and other adjustments.

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Net Surrender Value - The amount receivable in the event of a policy surrender, after all deductibles, bonuses payable and adjustments done. It is the final amount you will receive should you surrender your policy, which may be huge loss or zero during early years of your policy term.

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*Alternative to Surrender of policy: Should the policy holder intends to surrender a policy prematurely, an alternative to reduce losses would be selling your policy. The valuation is usually a percentage on top of your net surrender value, whilst keeping the policy in-force via ownership transfer.

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You may contact a policy services executive with Reps Holdings at +6586000581 for further advice.