4 Questions to Ask Yourself Before Purchasing A Direct Purchase Insurance (DPI)

Questions to ask before purchasing a direct purchase insurance

Written by Chew Jing Xuan

Direct Purchase Insurance (DPI) refers to whole or term life insurance products with total and permanent disability (TPD) and optional critical illness (CI) rider that can be directly purchased from life insurers. We have addressed the pros and cons of DPI as well as where to get them so if you are interested in purchasing a DPI, here are some questions to ask yourself whether getting a DPI is suitable for you.

#1 Are you savvy enough to make an informed choice?

It may seem like an attractive idea to get much cheaper premiums for your insurance without having to deal with pesky agents trying to upsell you certain products you don’t really need.

However, let’s be honest with ourselves, buying insurance is not as clear-cut as it may seem – from comparing coverage benefits, to looking at quotes or even understanding the terms and conditions of the products. This is especially so for the average layman who may not be well-versed with common insurance terms. Insurance agents can be of great help in simplifying the process of purchasing insurance.

Purchasing insurance is a long-term commitment and it is important that we buy the right products so we don’t have to be stuck with the wrong one, or even forgo paid premiums should we decide to cancel later.

That being said, we understand that getting the right financial advice is only possible with a good insurance agent who fully understands your needs and genuinely advise on products that truly benefits you. If you believe that you are financially savvy enough to know what products you want, perhaps DPI is a good option for you. It is ultimately up to one’s discretion whether the cost-savings of purchasing a DPI at the expense of sound financial advice is worth it.

#2 Do you mind handling the claims process by yourself? How about general enquiries?

With no agents involved, you would have to contact the insurer directly should you need to make any claims or enquiries.

Getting help via the call center might be a painful process considering that they have to handle hundreds of calls daily. Also, enduring red tapes (albeit necessary) of call centres, figuring your way about claims procedure and reading through long policy documents is the last thing you would like to experience during difficult times. With an insurance agent to serve you personally, you won’t need to find yourself stuck in the mess of settling claims in times of crises.

#3 What insurance products are you looking to buy?

Current DPI products only include term or whole life insurance with TPD cover and an option to add a rider for critical illness (CI).

While DPI products have generally similar features which make them easier to compare, they might not be ideal for those looking for more comprehensive products that will better suit their needs. Policies with additional benefits or riders might be of more value for an individual, but are not offered as DPI. Needless to say, more complicated products like endowment plans still have to be purchased through agents. Therefore it is imperative for you to understand your needs and what kind of products would be able to provide the coverage you need at the best value.

#4 How much coverage do you need?

For DPI, the maximum sum assured that can be purchased from one insurer is $400,000, with a sub-limit of $200,000 for whole life DPI.

This means that if you require higher protection needs than $400,000, you would have to buy from another insurer, with declaration made during application. This then boils down to the individual whether $400,000 is sufficient coverage or whether it’s worth the trouble to purchase from multiple insurers.

Furthermore, the CI rider for DPI only covers 30 out of the 37 CIs listed on the LIA website as these CIs are the most commonly claimed in Singapore. Although the 7 excluded CIs might be less common than the rest, it could still occur to anyone. After all, isn’t the purpose of insurance to cover for the unexpected? This may be an important factor of consideration for those who want to be well-covered for all critical illnesses.

To each his own

Ultimately, it is up to you to decide which method of purchasing life insurance is best suited for your personal needs. You might even consider using a combination of both DPI and buying through an agent to get the best coverage you need. That being said, you can also consider asking our pool of financial advisers who were carefully curated to ensure that you’re engaging with advisers of high caliber.

Been doing lots of research, but not sure who to engage to take the final step? Look no further! fundMyLife connects you to credible and incredible financial advisers privately and anonymously, based on the financial planning questions that you ask. We aim to empower Singaporeans to make financial decisions confidently.

Follow us on our fundMyLife Facebook page to get exciting updates and your dose of finance knowledge! Alternatively, the Insurance Discussion SG Facebook group is a good place to discuss insurance-related topics with fellow Singaporeans.

 

Pros And Cons Of Getting Insurance From Just One Financial Adviser

Pros and cons of getting insurance from just one financial adviser

There is a saying, that “diversity is strength”. While this is true on many fronts, can we say the same financial planning and insurance? Throughout our lives, we inevitably meet a lot of financial advisers, and there is always a question of whether to engage more advisers. This is especially true when we move from one life stage to next. In this article, fundMyLife explores the pros and cons of having just one financial adviser for financial planning.

Pros of having just one financial adviser

#1 No need to repeat yourself

Having just one financial adviser, especially if he/she is great, is all you need. He/she understands all of your financial needs and advises on suitable products. In this case, you do not need to keep repeating your financial situation to different financial advisers – it can be repetitive and tiring. Furthermore, if you have just one financial adviser, you just need to update him/her in cases of changes in life stages, e.g., life stages, occupation, financial situation, etc.

Furthermore, if you have any private matters you do not wish to talk about often, it’s easier to have a single person to handle everything. The less people know, the better.

#2 No redundancy

While being under-insured is a big problem, being over-insured is also an issue that is less discussed. Being over-insured poses a problem because you’re paying more than you should, limiting cash flow for other purposes like investments. This happens commonly when you buy policies from multiple people, who are not aware of what existing policies you have. Typically, the policies you own sit in drawers, untouched for a while. This is worse when you get them for reasons other than personal, e.g., to “support” a friend or family who has gone into the financial planning industry.

By sticking to a single financial adviser, you avoid this possible redundancy. Speaking of being over-insured – you do not want to be in a situation where you’re more valuable dead than alive to your dependents.

#3 Single point of contact

Picture this: you bought a life insurance from A, health insurance from B, and a personal accident policy from C. After that, let’s say you get into trouble, e.g., accident, sickness, etc, you’d have to recall who can help you with your incident. During claims situation, you’d want a single person who has access to your entire insurance portfolio. The last thing you want to do when disaster strikes is needing to figure out handles which policy.

Cons of having just one financial adviser

#1 All eggs into one basket

While having a single point of contact is convenient and useful, it also exposes you to risks as well. For example, a common issue consumers face is their financial advisers leaving the industry. Your policies would become orphan policies, a term that refers to policies without any servicing adviser. At best, if your adviser is responsible, he/she refers you to a reliable colleague. At worst, you’re left hanging and when it is time to make claims you’d have to take extra steps to contact the representative the company assigned to you.

Another possible risk is that your adviser becomes unwell and has to take a break from his/her job. It would be a bad timing if you need to make your claims during their downtime.

#2 Limited range of products

Unless your financial adviser is from an independent financial advisory, your choice of plans depends on the company your adviser is from. As such, it might not be a bad idea to engage multiple advisers to obtain specific products from different companies. With apps such as PolicyPal, IOLO, and TrueCover, it’s much easier nowadays to keep track of all your policies.

However, this does not imply that sticking to one company’s products is a bad thing. Products are competitive across the board. Most of the time, the differentiating factors lie usually in gimmicks. For example, wellness programs like AIA Vitality, or partnerships between Prudential and genetic testing company MyDNA. On a related note, the debate of tied adviser vs independent financial adviser is a completely separate issue, which we will explore another time.

Ask fundMyLife financial questions today!

With this article, we hope that you have a better idea of how having just one financial adviser can be a boon or bane. However, no matter whether it’s just one financial adviser that you engage, or several of them for different products, it’s definitely way more important to have the ones you can trust.

If you want to engage more financial advisers, or if you haven’t found the right one, why not consider advisers of fundMyLife? You can head on over to fundMyLife and ask our pool of financial advisers questions. Alternatively, you can check out our curated pool of individual advisers and ask them questions directly.

Been doing lots of research, but not sure who to engage to take the final step? Look no further! fundMyLife connects you to credible and incredible financial advisers privately and anonymously, based on the financial planning questions that you ask. We aim to empower Singaporeans to make financial decisions confidently.

Follow us on our fundMyLife Facebook page to get exciting updates and your dose of finance knowledge! Alternatively, the Insurance Discussion SG Facebook group is a good place to discuss insurance-related topics with fellow Singaporeans.

fML Reviews: Great Eastern Flexi Term and Flexi Living Term Premiums

Great Eastern Flexi Term and Flexi Term Living Premiums

In our previous article about Great Eastern Flexi Term and Flexi Living Term, we received some feedback. More specifically, the feedback involved discussing more on the Flexi Term and Flexi Living Term premiums. We get it. In a price conscious world out there, everyone wants a plan that is value-for-money. In this article, fundMyLife manually compiled Great Eastern Flexi Term and Flexi Living Term premiums and risk permanent repetitive motion syndrome.

Assumptions

An insurance premium for a term plan involves several factors: biological sex, smoking status, sum assured, and years of coverage. Given the enormous number of combinations and permutations available, we decided to fix one parameter, that is age.

We assume that the applicant is aged 25. In the subsequent tables, we will vary the following:

  1. Biological sex
  2. Smoking status
  3. Sum assured
  4. Number of years of coverage

Disclaimer: we do our best to get the most accurate information, which is accurate as of June 2018. However, we strongly recommend that you take these figures as a general guide and confirm the numbers with a trusty financial adviser.

Flexi Term and Flexi Living Term premium tables

We decided to lump the premiums for both policies together. To get the premium for a particular sum assured at a specific year of coverage, simply look at the intersection between the two values. For example, with reference to the table directly below, you will need to pay $117 per year for Flexi Term if your sum assured is $100,000 for 20 years’ of coverage. On the other hand, you need to $195 (the figure after 117) for the same sum assured and time length.

#1 Male, non-smoker

Great Eastern Flexi Term and Flexi Living Term premiums for a 25-year old male non-smoker
A table for a 25-year old non-smoker male for a range of sum assured for both Flexi Term and Flexi Living Term.

#2 Male, smoker

Great Eastern Flexi Term and Flexi Living Term premiums for a 25-year old male smoker
A table for a 25-year old smoker male for a range of sum assured for both Flexi Term and Flexi Living Term.

#3 Female, non-smoker

Great Eastern Flexi Term and Flexi Living Term premiums for a 25-year old female non-smoker
A table for a 25-year old non-smoker female for a range of sum assured for both Flexi Term and Flexi Living Term.

#4 Female, smoker

Great Eastern Flexi Term and Flexi Living Term premiums for a 25-year old female smoker
A table for a 25-year old smoker female for a range of sum assured for both Flexi Term and Flexi Living Term.

General observations

Based on the tabulated Flexi Term and Flexi Living Term premiums, we can see several notable things. Firstly, the premiums for Flexi Term are relatively level. To elaborate, there is little increase between 5 years, i.e. annual premiums for 2o years vs 25 years. Secondly, it does not pay to be a smoker wanting to purchase either policies. For Flexi Term, smokers for both sexes pay roughly 25-33% more. However, for Flexi Living Term, the difference is around 50%. This is not surprising, given that Flexi Living Term covers critical illness as well.

Ask fundMyLife financial questions today!

As the saying goes, knowing is half the battle won. We hope that these tables help you make a more informed choice with our Flexi Term and Flexi Living Term premiums tables.

However, if you’re still unsure about what you need, why not head on over to fundMyLife and ask our pool of financial advisers? Alternatively, you can check out our curated pool of individual advisers and ask them questions directly.

Been doing lots of research, but not sure who to engage to take the final step? Look no further! fundMyLife connects you to credible and incredible financial advisers privately and anonymously, based on the financial planning questions that you ask. We aim to empower Singaporeans to make financial decisions confidently.

Follow us on our fundMyLife Facebook page to get exciting updates and your dose of finance knowledge! Alternatively, the Insurance Discussion SG Facebook group is a good place to discuss insurance-related topics with fellow Singaporeans.

fML Reviews: NTUC GIFT

NTUC GIFT review

Written by Chew Jing Xuan

For those who own the NTUC membership card, did you know that being a NTUC member entitles you to beyond just supermarket perks? One of the many benefits would be life insurance with NTUC GIFT- a group term life insurance that NTUC members are entitled to when they join the union. Group insurance are plans that are usually subscribed by employers or group administrator to provide some basic coverage for their employees or members. Around 15% of Singapore’s population are union members – there’s a chance that you are one too if you’re reading this.

What is NTUC GIFT?

NTUC GIFT is a group term life insurance that covers for members of NTUC affiliated unions/associations. It provides coverage for death and total/partial permanent disability. Members are automatically covered if they fulfill these criteria:

  1. Are 16 years old and above and below 65 years old
  2. Have at least 6 months of continuous paid-up union/association membership.

For NTUC GIFT, there is no certificate of insurance as it is a group insurance policy and NTUC is the master policyholder.

Noteable features

#1 Extension of coverage is available after 65 years old

For members who are 65 years old and above are able to opt-in for GIFT Extension to enjoy extended coverage, if they still fulfil the membership tenure criteria. The extension requests are subjected to approval, as well as a token fee of $1-$3 per annum (but this token fee has been waived until 30 April 2022).

#2 Spouses of members are covered as well

NTUC GIFT also covers for members’ spouses against death and total/partial permanent disability, as long as they are between 16 and 65 years old and subject to members meeting the eligibility criteria. Members’ spouses are also eligible for GIFT Extension under the same eligibility criteria as the member.

#3 Union leaders are eligible for higher coverage

Union/ Association leaders are also eligible for double the coverage if they are:

  1. Affiliated to NTUC AND
  2. Registered under the Trade Unions Act or Societies Act.

Premium payment and payout

The premium for NTUC GIFT is fully covered by NTUC, with co-payment from the affiliated unions/ associations. In other words, as long as you continue paying for your NTUC membership fee, which is $117 per annum ($9 per month for Jan-Nov + $18 for Dec), you are able to enjoy this death and TPD coverage (among other benefits, of course).

Payouts for Death/TPD

NTUC GIFT Table
NTUC GIFT payout table for either deaths or TPD for member or his/her family members.

fundMyLife Reviews

With a nominal membership fee that entitles members to a multitude of benefits, NTUC GIFT serves as an extremely affordable basic life insurance for many Singaporeans.

However, there are certain things we need to take note of the policy as well. Firstly, the payout benefits is unlikely to be sufficient coverage for most people. As such, it can only serve as a short-term financial aid for the family.

Is the group insurance worth it? Let’s consider the following scenario. A union member of 10 years encounters an accident, and either dies or experiences TPD. His payout is $40,000, which is 34x of the membership fee he paid. Regular insurance plans have a 90-120x of the premiums paid for varying levels of sum assured, albeit the premiums cost more.

In addition, the policy only covers up to age 65, or age 75 if the GIFT Extension is opted. If one is to rely solely on this policy, there would be a protection gap left after 75 years old. Hence, it is essential that members boost their life protection with other policies, while NTUC GIFT can be a supplement to the other policies.

For more details, head over to NTUC GIFT Brochure to find out more.

Ask fundMyLife financial questions today!

And we have come to the end of our review for NTUC GIFT. We hope this review will help you make a better choice.

If you’re still unsure about what you need, why not head on over to fundMyLife and ask our pool of financial advisers? Alternatively, you can check out our curated pool of individual advisers and ask them questions directly.

Been doing lots of research, but not sure who to engage to take the final step? Look no further! fundMyLife connects you to credible and incredible financial advisers privately and anonymously, based on the financial planning questions that you ask. We aim to empower Singaporeans to make financial decisions confidently.

Follow us on our fundMyLife Facebook page to get exciting updates and your dose of finance knowledge! Alternatively, the Insurance Discussion SG Facebook group is a good place to discuss insurance-related topics with fellow Singaporeans.

 

fML Reviews: Great Eastern Flexi Term and Flexi Living Term

Great Eastern Flexi Term and Flexi Living Term Review

Life insurance is a form of insurance policy which pays a sum of money upon the death of the insured person. It’s usually one of the first policies that a financial adviser recommends, since it takes care of your dependents if bad things happen to you. Life insurance used to be whole-life plans, i.e. it provides life-long protection. However, in light of changing consumer demands, term insurance emerged as an increasingly popular choice. Term plans, as opposed to whole-life ones, cover you only for a fixed period of time.

In this article, fundMyLife reviews Great Eastern’s term life products – Flexi Term and Flexi Living Term and explores their features. Note: this information is accurate as of June 2018.

What is it?

Flexi Term and Flexi Living Term are regular premium term life insurance. Both Flexi Term and Flexi Living Term have coverage for death, total and permanent disability (TPD), and terminal illness. The difference is that Flexi Living Term also includes additional cover for critical illnesses.

Notable features

#1 Flexibility to convert

You have the option to convert the plan into a whole life, endowment, or even investment-linked plan.

#2 Extended TPD coverage

A common coverage limit for term insurance is either 65 or 70 years old. With extended TPD  benefit, Flexi Term and Flexi Living Term can extend your coverage beyond that, until the age of 85 or the end of the policy term.

Insurance charges

To explore the insurance charges, fundMyLife decided to start with a few key assumptions:

  1. Applicant is 25 years old
  2. Sum assured is $200,000
  3. Cover until 45/55 years old

Annual premiums at a glance

Great Eastern Flexi Term and Flexi Living Term Premiums
The annual premium table for Flexi Term and Flexi Living Term for four different young adults’ profiles.

We constructed four different profiles, varying smoking status and length of cover. At first glance, we observe that Flexi Living Term costs relatively more than Flexi Term per year for all four profiles. This should not be surprising since Flexi Living Term covers critical illnesses as well.

In general, both Flexi Term and Flexi Living Term annual premium is quite affordable at a sum assured amount of $200,000.

Flexi Term Review

The plan is flexible, in more ways than one. Firstly, with a minimum of 6 years’ term, you can hang on to it as long as you want/need. Secondly, you have to option to convert this plan to a different one later in your life. This is good for those who just started out on their careers and do not have any dependents yet. The extended TPD coverage is a nice touch as well.

In a way, Flexi Living Term is like Flexi Term with an additional critical illness rider. However, the coverage is only for regular critical illness. This means you should consider another plan if you want coverage for early critical illnesses.

Speaking of riders – there are riders for these policies. As such, you can supplement this plan with riders that protect you in other ways. For example, personal accident and disability income. However, information is sparse with these riders so you’ll have to approach a financial adviser from Great Eastern for more details.

In addition, bear in mind that Flexi Term and Flexi Living Term are non-participating policies. You won’t be getting any cash accumulation, payouts, or even surrender value. As such, you should consider investing the rest of your money if you want to grow it at some point. If your budget allows it, that is.

Ask fundMyLife financial questions today!

And we have come to the end of our review for Great Eastern Flexi Term life insurance. We hope this review will help you make a better choice. That said, it really depends on what you need.

If you’re still unsure about what you need, why not head on over to fundMyLife and ask our pool of financial advisers? Alternatively, you can check out our curated pool of individual advisers and ask them questions directly.

Been doing lots of research, but not sure who to engage to take the final step? Look no further! fundMyLife connects you to credible and incredible financial advisers privately and anonymously, based on the financial planning questions that you ask. We aim to empower Singaporeans to make financial decisions confidently.

Follow us on our fundMyLife Facebook page to get exciting updates and your dose of finance knowledge! Alternatively, the Insurance Discussion SG Facebook group is a good place to discuss insurance-related topics with fellow Singaporeans.

4 Reasons Why You May Be Declined For Life Insurance

Reasons for Declined for Life Insurance

Written by Jing Xuan

Underwriting is one of the most dreadful procedures of getting an insurance, but it’s a necessary evil to keep premiums affordable. It is the process whereby the insurer evaluates a proposed client’s risks before deciding whether to accept, decline, or amend the terms of acceptance.

#1 Pre-existing conditions

Having pre-existing health conditions means that an individual is likely to have higher mortality risks. Certain medical conditions will affect an insurer’s decision on whether to insure an individual and the premium rates offered. Hence, clients are required to declare any pre-existing health conditions before a policy is approved. If need be, the client may be required to go for a medical examination.

Pre-existing conditions may not necessarily mean a guaranteed denial of life insurance as insurers might still approve the policy with special amendments made, such as exclusions, higher premiums or reduced coverage amount. Clients with pre-existing conditions such as diabetes can look to purchase alternative plans such as AIA Diabetes Care, or plans that specifically account for pre-existing conditions.

This is in no way encouraging any potential clients to lie or hide any pre-existing health conditions as any omission of such information puts the beneficiaries at risk of having their claims denied.

#2 Hazardous occupation

Occupational choice is also one of the considerations for a life insurance policy approval. While you may be in the pink of health and at no risk of disease or death, working in a dangerous field could make insurers reluctant to approve your policy, simply because the risks associated with some jobs are deemed too high to be insured. For such occupations, even a completely competent worker with an accident-free record has no guarantee that the insurers would offer coverage. Hazardous occupations typically include highly manual and dangerous work like firefighters, oil riggers, offshore workers, etc.

Nonetheless, for high-risk industries, it is likely that the company would provide group insurance for their employees at a lower premium with less scrutiny involved, so you can utilize on the company insurance before getting a private one.

#3 High-risk lifestyles

Just as some occupations are more hazardous than others, there are also recreational activities that are considered dangerous and carry a higher risk of premature death. Activities deemed hazardous differ from one insurer to another but some of which that fall under grounds for denial include skydiving, bungee jumping and scuba diving. These activities may be a source of excitement in life but they could also be a hindrance when it comes to getting your life insurance approved.

#4 Incomplete/ inaccurate proposal forms

It is the personal responsibility of the applicant to fulfill his duty of disclosure of any relevant material information at the point of proposal. If proposal forms are incomplete or if the underwriter has identified red flags in the forms, proposals will be denied. Concealing certain critical information at proposal will also grant the insurer the right to deny beneficiaries the death benefit claims. Even if your erroneous proposal is not declined, incomplete or inaccurate information will lead to a rejection of claims when disaster strikes in the future.

Always remember, honesty is the best policy.

Conclusion

Getting your policy denied after a long process of filling up proposal forms with your agent isn’t the best news to hear. But there are some ways to reduce the chances of being declined for an insurance policy such as buying when you’re young to lock in lower premiums and get full coverage before developing any health issues later in life. If you already have existing health issues, look out for policies that are specially tailored for special conditions or a higher tolerance for common exclusions. Don’t despair if you were rejected once – try again with other insurers or discuss with your financial adviser on alternative options to pursue.

Ask fundMyLife financial questions today!

If you’re still unsure about what you need, why not head on over to fundMyLife and ask our curated pool of financial advisers? Alternatively, you can check out our curated pool of individual advisers and ask them questions directly.

Been doing lots of research, but not sure who to engage to take the final step? Look no further! fundMyLife connects you to credible and incredible financial advisers privately and anonymously, based on the financial planning questions that you ask. We aim to empower Singaporeans to make financial decisions confidently.

Follow us on our fundMyLife Facebook page to get exciting updates and your dose of finance knowledge! Alternatively, the Insurance Discussion SG Facebook group is a good place to discuss insurance-related topics with fellow Singaporeans.

 

fML Reviews: Aviva MyLifeInvest

Aviva MyLifeInvest Review

Investment-linked policies, or ILP, are policies that features both investment and protection components. It’s often marketed as a plan that is flexible and is tailored for your needs. It also has high returns, in exchange for high risks. In this article, fundMyLife examines the features of Aviva’s only ILP, MyLifeInvest, and reviews it.

What is it?

Aviva MyLifeInvest is a regular premium ILP. It provides a lifetime coverage for death and terminal illness. It also provides coverage for total and permanent disability (TPD) until age of 70.

Noteable features

#1 Benefits when life-stage events happen

When you reach a new life-stage, you can raise your sum assured without a medical checkup. According to Aviva, it means a change in marital status, childbirth/new addition to the family, i.e. adoption, and approval of mortgage. Bear in mind you’ll have to apply within 3 months of the mortgage approval. On top of that, your change in life-stage requires proper documentation and evidence for the adjustment of benefits.

#2 Reducing coverage

Besides life-stage events where you increase your coverage, you can also reduce your coverage as well. In fact, you can even reduce your coverage to zero to maximize investments. However, you can only do so if either you reach 55 years old, or you have paid at least twelve years’ worth of premiums. On other other hand, increasing the sum assured after reducing it is subjected to medical underwriting.

#3 Riders

This product has several riders available:

  1. Level Term Cover – additional protection against death and terminal illness
  2. Early Critical Illness Cover – covers earlier stages of critical illness on top of regular ones
  3. Critical Illness Additional Cover
  4. Critical Illness Accelerated Cover
  5. Level Term Critical Illness Accelerated Cover
  6. Payer Critical Illness Premium Waiver Benefit
  7. Payer Premium Waiver Benefit
  8. Critical Illness Premium Waiver

In general the riders are categorized into three kinds: 1) enhanced coverage of death and TPD, 2) critical illness coverage, for both early and normal, and 3) premium waivers in the case of sickness or accidents.

Insurance cost

Turns out the product summary is not available publicly online. However, we contacted kind advisers from Aviva for a copy of the MyLifeInvest product summary. From there, we obtained more details on the insurance coverage charge for death, TPD, and critical illness riders separately.

#1 Death benefit

MyLifeInvest death charges
How much you need to pay per year for each $1,000 sum assured. Data obtained from MyLifeInvest product summary.

We observe that the coverage amount is relatively low until early 50s which then starts rising exponentially. Interestingly, the rates are not too different for male and female non-smokers and smokers.

#2 TPD

Aviva MyLifeInvest TPD Graph
The amount of money you need to pay each year per $1,000 coverage for TPD. Data obtained from MyLifeInvest product summary.

The charge for TPD is relatively low for the first 40 years of age, which then increases exponentially thereafter. However, the range of the amount is small, with the maximum of $7/$1000/year.

#3 Critical illness

Aviva MyLifeInvest CI graph
The yearly insurance charge for critical illness per $1,000 coverage. Data obtained from MyLifeInvest product summary.

The insurance charge for critical illness has a similar range to death, with the premiums mostly very low until the age of 50. After that, the premiums go up very quickly.

fundMyLife reviews

As observed from the charts above, the premiums for death, TPD, and critical illness are relatively low for the first 50 years of age. The charges then increase exponentially thereafter. As such, this plan is useful earlier in your life as a means of cheap protection, not unlike term plans.

The option to minimize your coverage, and at some point to zero, is useful if you want to focus on your investments. Who is it for? We think it’s good for people who want to invest but needs a lot assistance – preferably together with a financial adviser who knows what he or she is doing. It requires active monitoring since insurance cover charge increases over time leaving you less to purchase units in funds.

While we obtained a copy of the product summary, there were several details missing such as the specifics for some of the riders, e.g., premium waiver conditions, early critical illness charge, etc. As such, you will have to contact the representatives for more information. However, based on our intuitive understanding of the rider names, think MyLifeInvest is a relatively modular ILP compared to the others out there. This is probably because MyLifeInvest is the only ILP from Aviva, which means it has to be very flexible to cater to as many people as possible.

Ask fundMyLife financial questions today!

That’s all folks! We hope you found the review useful and got more detailed information on what MyLifeInvest is all about.

If you’re still unsure about what you need, why not head on over to fundMyLife and ask our curated pool of financial advisers? Alternatively, you can check out our curated pool of individual advisers and ask them questions directly.

Been doing lots of research, but not sure who to engage to take the final step? Look no further! fundMyLife connects you to credible and incredible financial advisers privately and anonymously, based on the financial planning questions that you ask. We aim to empower Singaporeans to make financial decisions confidently.

Follow us on our fundMyLife Facebook page to get exciting updates and your dose of finance knowledge! Alternatively, the Insurance Discussion SG Facebook group is a good place to discuss insurance-related topics with fellow Singaporeans.

New To Investments? Here’s 5 Things To Look Out For When Creating An Investment Account.

Tips when creating an investment account

Written by Sherwin Chan, edited by Jackie Tan.

As promised from the previous article, where I shared my personal experience in getting started in stocks, this is the follow-up article where I go into a lot more detail on the things to look out for when creating a brokerage account. After all, when you first decide to dabble in investments, you must first create your platform to stand, and there are many options available for you. So, keeping a lookout for the things written below will make sure you create a sturdy platform that can make your investment life simpler!

#1 Commission Fees

This is a no-brainer thing to look out for. Would you have spent money on a trade knowing that there are cheaper commission fees options out there? Of course not! So how do you go about selecting a brokerage firm from this option? Well, one important aspect is knowing your own investment goals and financial capability.

If you know your investment goal or specific products you want to buy, be sure to choose a brokerage firm with the lowest commission fees for that product you want to buy! Most of the time, there won’t be a specific minimum to have when making your trades, but brokerage accounts do have a basic fee when you make a trade. Keep a lookout for this amount especially if you don’t have enough to hit the lowest band of trade amount.

Lastly, don’t just consider the minimum commission and the percentages charged on the lower end of the trading amount, but look at the fees the firm charges at the higher end of the scale as well. After all, as you progress on, you will earn more income from your job etc., and you will be trading more substantial amounts, and commission fees on the higher end of the scale become essential.

#2 Ease of use of the online platform

This is especially important since 99% of the time you’ll place your trades online (commission fees are usually cheaper this way). Some firms provide very old-school user interfaces to make the website faster by reducing the fanciful user interfaces (useful for those intending to do high-speed trades), whereas I prefer a more user-friendly interface (since I invest in the long term) and only log in occasionally. Every individual has their own needs and preference and needs so make sure you choose based on what you require. The last thing you want for a long-term investor is a platform that’s hard to access the information about the fundamentals of the companies! You can find tons of online reviews of the different platforms in Google regarding this.

#3 Scope and Depth of Research Reports

Investment firms pour tons of money into this area of their operation because if you make the right trades, they earn more commission fees. However, not all research reports are created equally; quality of analysis is essential. Additionally, the coverage of the research reports regarding several markets (E.g., Hong Kong, Japan etc.) and the coverage for medium cap firms and penny stocks. These are usually the neglected ones, but they tend to have higher returns than blue chips (big established firms). The frequency of update is also critical. Do they update quarterly? Semi-annually? And lastly, is the accuracy of the reports. When they recommend buy and give you a price target, how are their hit rate and standard deviation? All these are difficult to answer especially when a newcomer does not have access to the resources but have faith in Google and your researching skills.

I implore you to spend more time on doing this especially if you’re a newbie because research reports by brokerage firms are usually exclusive information and can provide you with more in-depth insight on the inner machinery of how the market works. This information is priceless (not really since you pay via commission fees).

#4 Customer Service

Don’t underestimate the importance of customer service. If you ever encounter any problems in your trades, especially if a sizable amount of your money is tied down, the last thing you want to hear over the phone are stupid jingles that last for eternity, while the customer service officer enjoys his cup of coffee on the other end, taking his time to finish his biscuit before attending to you. Customer service is especially crucial for those who intend to do most of their trades over the phone and for beginners who will most likely face problems over the system when doing their trades.

#5 Freebies

One freebie that is prevalent in most brokerage firms are the attractive sign-up bonuses you can receive. These can come in the form of commission-free trades or a one-time sign-up bonus. After reading all the above, if you still need help in deciding what brokerage firm to use, the freebies that come with the brokerage firm might help make or break the decision you make so make sure you choose wisely. Additionally, some brokerage firms have young investors scheme where they provide lessons beginners on certain basics.

After reading all the above, I hope you have a clearer idea of what to look out for when choosing a brokerage account. Remember, the above is just a short list and explanation of what to look out for. Don’t neglect your research into the company and make sure you tailor your investment needs to the best brokerage firm out there. Having an excellent online platform can make your experience investing an enjoyable and more importantly, profitable one 🙂

Been doing lots of research, but not sure who to engage to take the final step? Look no further! fundMyLife connects you to credible and incredible financial advisers privately and anonymously, based on the financial planning questions that you ask. We aim to empower Singaporeans to make financial decisions confidently.

Follow us on our fundMyLife Facebook page to get exciting updates and your dose of finance knowledge! Alternatively, the Insurance Discussion SG Facebook group is a good place to discuss insurance-related topics with fellow Singaporeans.

fML Reviews: NTUC Income VivoLink

NTUC Income VivoLink Review

Investment-linked policies, or colloquially know as ILPs, are policies that combine both protection and investment. Its main draw lies in its flexibility and potential high returns, which comes with high risks as well. NTUC Income offers two ILP products: VivoLink and VivaLink.

We know what you’re thinking. No, VivoLink is not the name of the bridge to VivoCity. VivoLink is the sibling investment-linked plan (ILP) of VivaLink, which we reviewed in our previous article. In this article, fundMyLife examines NTUC Income VivoLink’s features and reviews it.

Disclaimer: we are neither endorsing nor hating on these products, nor ILPs in general. We believe that there’s a time and plan for everyone. As such, it is all the more important that consumers are aware of the pros and cons of these products.

What is it?

VivoLink is a regular premium ILP.  The plan pays the basic benefit or cash-in value (whichever is higher) in the event of death or total and permanent disability (TPD) before the age of 70. VivoLink also pays the basic benefit or cash-in value in the event of diagnosis of dread disease, or critical illness.

The death benefit depends on your age range when you die, i.e. the younger you are the higher the payout is. In the case of accidental death or TPD, the amount received is higher compared to the same age bracket. Restrictions apply to accidental deaths and TPD, i.e. you’d get a lower payout if risky activities or occupations caused the death or TPD.

Notable features

This is a list of selected features of the plan that we thought were interesting/unique. Other information like calculation of benefits can be found here.

#1 Retrenchment benefit

One thing that stood out in the plan was the retrenchment benefit. If you have not been able to find employment for three months, you can choose not to pay the premiums for a maximum of 24 weeks. Your coverage is not affect during this. Note: you must have paid a minimum of six months’ premiums.

#2 Extensive range of funds

One draw is that you can choose from a wide range of funds. You can invest in as many funds as you need to, provided that you can set aside a minimum amount for each fund that you put in. Choosing VivoLink also gives you access to NTUC Income’s very own Aim Series. The Aim Series funds are a mix of equities, bonds, and alternative assets such as commodities and property. It is composed of five different funds: 1) Aim Now, 2) Aim 2025, 3) Aim 2035, and 4) Aim 2045. As its name suggests, you can choose the fund based on the target year that you need it. For example, if you want the money in 2045 you choose Aim 2045. Besides the amount of time, the funds also differ in risk profiles. Aim Now has the lowest risk profile whereas Aim 2045 has the highest.

#3 Policy loan

As opposed to its sister plan VivaLink, you can apply for a policy loan if you are unable to pay the premiums. The current policy loan amount (as of May 2018) is either 50% of the total cash value of the policy, or 80% of the net investment amount – whichever is lower. The interest rate of the loan is set at 5.5% p.a. If the amount of the loans and interest is more than the cash value of the policy, all benefits will stop.

Insurance details

NTUC VivoLink Premium
The minimum and maximum premium per unit time. Table adapted from https://www.income.com.sg/NTUCIncome/CMSTemplates/PrintFaqs.aspx?pId=7672

There is no discount for paying annually, and as such for cash flow purposes it might be a good idea to go for monthly payment instead of yearly where you pay a lump sum.

VivoLink Review

The retrenchment benefit is useful for those who stand a high chance of retrenchment/unemployment. PMETs are at high risk of being retrenched. While older professionals are at risk of being retrenched, younger workers are not spared as well. Besides the retrenchment benefit, VivoLink has other features that allow temporary respite for customers who cannot pay the premiums. For example, policy loans help deal with the matter temporarily. It’s a crutch, and it’s dangerous to depend too much on a crutch.

One thing – there are no riders available for this plan. However, the plan does cover death, TPD, and dread disease/critical illness. Compared to other plans, dread disease/critical illness usually comes as a rider to a main life insurance plans. While there is dread disease/critical illness coverage, you do not have the option of adding an early critical illness rider. You will have to supplement it with other early critical illness plans out there. In addition, riders that waive premiums are also unavailable so you must take note of that too.

All in all, VivoLink is relatively more flexible in investment due to a larger pool of funds, but is less so for protection compared to its sibling ILP. The critical illness coverage in the base plan offsets the lack of riders.

Fun fact: Muslims can consider NTUC Income’s offerings because NTUC handles Shariah-compliant funds in Singapore. The Takaful Fund is one of the special funds in NTUC Income that invests in global equity markets via Shariah-compliant instruments.

Conclusion

That’s all folks! We hope that you understand VivoLink a bit better now. It is an interesting product that may or may not suit you, depend on your financial planning portfolio.

However, if you’re still unsure what you need, why not head on over to fundMyLife and ask our curated pool of financial advisers? Alternatively, you can check out our curated pool of individual advisers and ask them questions directly.

Been doing lots of research, but not sure who to engage to take the final step? Look no further! fundMyLife connects you to credible and incredible financial advisers privately and anonymously, based on the financial planning questions that you ask. We aim to empower Singaporeans to make financial decisions confidently.

Follow us on our fundMyLife Facebook page to get exciting updates and your dose of finance knowledge! Alternatively, the Insurance Discussion SG Facebook group is a good place to discuss insurance-related topics with fellow Singaporeans.

fML Reviews: NTUC Income Vivalink

NTUC Income VivaLink Review

Investment-linked policies, or colloquially know as ILPs, are policies that combine both protection and investment. Financial advisers (or at least errant ones) often promote these to consumers as a way to have the best of both worlds. It’s a controversial plan, with plenty of threads on forums cautioning people of its lack of utility.

In the previous comprehensive list of ILPs in Singapore, we briefly reviewed NTUC Income’s ILP offerings – VivoLink and VivaLink. In this article, fundMyLife takes a closer look at one of these two policies, VivaLink and reviews it.

Disclaimer: we are neither endorsing nor hating on these products, nor ILPs in general. We believe that there’s a time and plan for everyone. As such, it is all the more important that consumers are aware of the pros and cons of these products.

What is it?

VivaLink is a regular premium ILP. In the event of death or total and permanent disability (TPD) before age 70, the plan pays the basic benefit or cash-in value, whichever is higher, minus any applicable fees and charges. In the case of death or TPD due to an accident, you will also receive an additional 100% of the sum assured or $100,000. However, the additional money might be lower if certain risky activities are responsible for the accident.

Noteable features

This is a list of selected features of the plan that we thought were interesting/unique.

#1 Guaranteed insurance coverage in the first 10 policy years

A relatively attractive draw, since you’ll never know what might happen to you in the next 10 years.

#2 Additional riders

  1. Dread disease cover: dread disease is another term for critical illness, and if the insured individual diagnosed with such a disease he or she is paid the sum assured.
  2. Dread disease premium waver: The rider waives future premium payments for VivaLink if you are diagnosed with any of the dread diseases.
  3. Payor premium waver: If the insured person is not you – the policyholder and payor – and you die or experience TPD, future premium payments are waived.
  4. Enhanced payor premium waver: Similar to payor premium waver, except the waiver happens when/if you are diagnosed with dread disease as well.

#3 Benefits when life events happen

One notable feature is the ability to increase coverage without medical assessment when you enter new life events and/or receive additional units for increase in regular premium. NTUC Income defines life events as “turning 21 years old, getting married, purchasing a residential property or becoming a parent.”

There are a few more features that we observed, but were self-explanatory. For example, bonus allocation of units in the 15th and 20th policy year. There’s also a retirement option that allows you to reduce insurance coverage to $0 from 55 years old onwards to maximize wealth accumulation.

Insurance charge

We here at fundMyLife love data. As such, it was fortunate that we found information on the yearly insurance charge for death and TPD for each $1,000 insured. Based on the data, it seems like the most important factors are sex and smoking status.

VivaLink premium graph
The annual insurance charge for death and TPD. Source: https://www.income.com.sg/forms/policy-conditions/vivalink.aspx?ext=.pdf

Based on the graph above, the yearly insurance charge for death and TPD becomes exponential after you’re 40 years old. Unsurprisingly, male smokers pay the most, followed by female smokers, male non-smokers, and finally female non-smoker. Female smokers and male non-smokers pay about the same for the annual insurance charge for most of the time.

VivaLink Review

As observed from the graph above, VivaLink is good for a relatively cheap death and TPD protection for an early part of your life. With the additional riders, you can also enjoy critical illness coverage and premium wavers in case of any mishaps.

The life event feature was interesting because of the acknowledgement that an individual’s needs change over time. This feature is useful because you require additional medical underwriting when you want to increase your insurance coverage. In addition, there’s no change in the monthly premium if you exercise the first option to increase coverage.

The extra dread disease/critical illness rider is useful, but there is no rider for early critical illness. For that, you will have to purchase a separate plan. In general, this plan is a useful plan if you are confident that you will enter/can enter the stated life events.

Fun fact: Muslims can consider NTUC Income’s offerings because NTUC handles Shariah-compliant funds in Singapore. The Takaful Fund invests in global equity markets via Shariah-compliant instruments.

Conclusion

That’s all folks! We hope you found the review useful and sheds more light into what VivaLink is all about.

If you’re still unsure what you need, why not head on over to fundMyLife and ask our curated pool of financial advisers? Alternatively, you can check out our curated pool of individual advisers and ask them questions directly.

Been doing lots of research, but not sure who to engage to take the final step? Look no further! fundMyLife connects you to credible and incredible financial advisers privately and anonymously, based on the financial planning questions that you ask. We aim to empower Singaporeans to make financial decisions confidently.

Follow us on our fundMyLife Facebook page to get exciting updates and your dose of finance knowledge! Alternatively, the Insurance Discussion SG Facebook group is a good place to discuss insurance-related topics with fellow Singaporeans.