Heavy penalty on single premium policy

I have seen the single premium whole life product issued by at least two large life insurance companies.

It is quite unfair for the insurance company to penalise the policyholder by 25% of the single premium on early termination and to take almost 10 years to reach the break-even point. The actual cost of the life insurance protection is quite low. There is no need for this heavy penalty.

I hope that the MAS will consider the fairness of this product. After all, they did ask the top management and board to be responsible for "fair dealing outcomes" for their policyholders.

I cannot stretch my imagination to believe that such terms can be considered to be fair. It may be legal, i.e. written in the contract under "caveat emptor", but it is not fair to impose such terms on unwary customers.

Tan Kin Lian