Poor return on whole life policies

Someone asked my advice about 3 whole life policies taken about 12 years ago. Two cover death only. One cover critical illness.

My analysis of these policies showed:

* the total annual premium is about $2,700 a year
* after 12 years, the cash value is about 70% of the total premiums paid, ie $23,000
* if he had bought a decreasing term, the premium would cost about 10% only
* if the remaining 90% were invested to earn 5% p.a., the accumulated amount will be about $40,000, ie a difference of $17,000.
* he has obtained a negative return on his policies after 12 years.

NOTE: These policies are NOT from NTUC Income.