Asked by ZhanQing Koh

Insurance companies tends to differentiate same basic products by tweaking some minor points and/or t/c. What are the must have and the good to have? Focus on term life insurance. ?

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  • Daniel Lee
    Daniel Lee
    Level 3. Wonderkid
    Answered on 07 Jul 2018

    I dont really quite understand your question. But if i may contribute, the point of buying insurance is to ensure that if something happens, you will be able to claim. Hence, when examining the fine prints of an insurance, it is essential for you to filter products based on their definition when it comes to certain claim conditions.

    In terms of cost, the concept of buy-term invest the rest might not be economically justifiable as one will have to do a proper analysis in the total cash outlay from a life-insurance vs a term insurance. Hence, it will depend on your financial condition, your budget, and your own experience in managing your own investment portfolio.

    Here's an example of a comparison that I do for my clients. Hopefully, from this you will be able to understand that the concept of buy-term-invest-the-rest might not be a best solution depending on your individual situation.

    If i may do abit of self promotion, should you need any help in learning about the framework needed to compare products on your own or if you need any help in managing your finances, you can learn more about it on my website: https://www.sgifa.net/

    Comments (1)
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    • Loh Tat Tian
      Looking at the figures, I guess the person who bought the insurance started at age 40. Not a very good age to be buying a whole life plan. Based on quotation from MoneyOwl, The cost of whole insurance is a lot higher than your example. Also, i doubt you are using time value of money. (which makes the opportunity cost of the whole life seem so much cheaper). This is very misleading. Why not draw an actual graph and show it?
      24 Dec 2018