facebookMy insurance agent keeps telling me term is more expensive then whole life in the short term. Paying about 2.6k a year for whole life with ci and eci. Is is true that term is more expensive? - Seedly

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Anonymous

12 Jun 2019

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Events

My insurance agent keeps telling me term is more expensive then whole life in the short term. Paying about 2.6k a year for whole life with ci and eci. Is is true that term is more expensive?

Discussion (8)

What are your thoughts?

Eric Chia

Eric Chia

12 Jun 2019

Senior Financial Consultant at Prudential

Hi there, generally speaking, term is more expensive (in the absolute amount of premiums paid) than whole life if any of the following happens:

  • the term plan sum assured is very high, like $500k
  • the term plan is sized to cover you beyond 65yo
  • you are pretty old, like at least 45yo when you receive the quote to buy a term plan
Allan Lee

Allan Lee

09 Apr 2019

Financial Planner at Axa Singapore

You might want to consider term plan which covers you till age 65 (Means you got to pay premium from the start to age 65) but if you get a whole life plan (You can choose your premium payment term like 15, 20, 25years) then get covered till 99 years old.

One more thing to consider is that term plans do not have any cash value (Anything that you use to pay, you won't be able to retrieve them back if nothing happens to you) but for whole life plan, there is cash value.

Loh Tat Tian

Loh Tat Tian

05 Apr 2019

Founder at PolicyWoke (We Buy Insurance Policies)

In term of relative cost, it may be true, since you are basing it on cost alone

Example: Term is $800 per month, but if you pay till 65 (assuming you are 30 now), that's 35 * 800= $28,000.

A whole life limited with CI may only cost $1,500 * 15 years = $22,500 and has cash value. But...

Time value of money and investment return is not calculated. Hence why people say BTIR is the best.

A lot of people make this mistake of thinking in absolute terms like this.

HC Tang

HC Tang

25 Mar 2019

Financial Enthusiast, Budgeting at The Society

No. This just came out, is a good answer to you question :

https://www.firepathlion.com/i-threw-away-10000...

Luke Ho

Luke Ho

09 Mar 2019

Founder and Director at CFX Money Maverick Pte Ltd

That is a very weird thing to say to someone.

For ECI and CI, there does tend to be a cost dispar...

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