ST Online Forum: Hit hard by insurance policy termination

ST ONLINE FORUM
I BOUGHT three policies from Prudential for my children 15 years ago. Recently, due to a need for cash, I decided to terminate one of the policies.

To my shock and disappointment, the amount I am getting back upon surrendering the policy equates to less than 50 per cent of my contribution in the last 15 years.

I can understand if the early termination results in an 80 per cent return, but 50 per cent?

The customer service officer told me that given the crisis last year, policyholders did not have good bonuses and therefore the drop in value. So my questions are:

How can the year's bonus affect 50 per cent of my investment because a good bonus does not double my principal sum.

Is there an organisation in Singapore that ensures that policyholders are being protected?

As much as there are risks, what about those who have invested for 30 years hoping to get a good return only to be given the same answer?

Will the authorities please look into this so all of us who hope to retire well by investing in insurance policies will not lose a substantial amount of our hard-earned cash.

Sabrina Tan (Mdm)


MY COMMENTS

MAS should be the body that is responsible to look after the interest of consumers and make sure that they are fairly treated, especially on the declaration of bonus. I hope that MAS will ask Prudential to given an explanation and check if the explanation is acceptable. I am surprised that the cash value is only 50% after 15 years. It should have "broke even" by now.

MAS should not refer this matter to FIDREC. It should be investigated by MAS, as it is the core of the operation of the insurance company.