Re-invest into the Combined Fund

Dear Mr Tan

I bought this policy from Co X in year 2000 through an Insurance broker.

a) Enhanced living assurance, S$1924 per year
b) Premium payable for 52 years from age 33
c) Sum assured: $100,000 with annual reversionary bonus of $10/$1000 sum assured plus 1% of accumulated bonus.
d) From the sale quotation, at age 65 total premium paid-up S$61,568, surrender value : guaranteed 57400 non guaranteed S$33,190
e) Current policy status: total premium S$11,544, surrender value : guaranteed S$8,000 non guaranteed S$2,251

I have seriously considered surrendering this policy and go into term policy. What is your advice.

PL

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Dear PL

If you surrender the current policy and invest the cash value in our Ideal Combined Fund, you are likely to get the following:

a) Single premium: $10,251
b) Regular premium of $1,924 per year, $250 is used for decreasing term assurance, $1,674 is invested in the Combined Fund

Projected benefit at age 65 (not guaranteed)

- $125,900 based on return of 5% a year
- $181,600 based on return of 7% a year

The accumulated savings at age 65 is higher than that projected value ($90,000) under your current policy at age 65.

Tan Kin Lian