Insurance
The harm caused by regular premium Investment-Linked Policy benefit illustrations
By Wilfred Ling, The IFA on Duty  •  February 6, 2014
With effect from 1 February 2014, benefit illustration for single premium ILP and recurrent single premium ILPs will no longer be provided. I support this move although I am disappointed that the status quo still applies for regular premium ILPs. First, what is a benefit illustration? The benefit illustration shows the death benefit and surrender value based on assumed investment rate of return.  For investment linked policies, the death benefit and surrender values depend on the underlying unit trusts.  The benefit illustration shall be removed with effect from 1 February 2014 because of two main reasons. The first reason is to avoid consumer having a misconceptions of the returns they can expect from their policy. The second reason is that the removal of benefit illustration for ILP is to align with the industry’s practice of not allowing projections for unit trusts. According to the FAQ provided by LIA, ......
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By Wilfred Ling, The IFA on Duty
Wilfred Ling is a Chartered Financial Consultant with Promiseland Independent Pte Ltd. He is a fee-based financial planner by profession.
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