New Benefit Illustration
By Tan Kin Lian  •  May 26, 2008
By: Tan Kin Lian Tan Kin Lian picture Life insurance companies are now required to use a new format of Benefit Illustration, based on the projected investment yield of 3.75% and 5.25% per annum. The lower yield of 3.75% reflect the current investment environment, with low yields on bond investments. Policyholders should be aware that the charges imposed on a life insurance policy to pay for the marketing expenses (e.g. agent commission and sales incentives), administrative expenses and mortality charges (for the life insurance cover) remains to be quite high. I estimate that the charges can reduce the yield by about 2.5% for an endowment policy and 3.5% by a whole life or critical illness policy. Read more...
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By Tan Kin Lian
Mr Tan Kin Lian (fomer NTUC Income CEO) started his insurance career in 1966 in a local life insurance company. He has also worked in various positions as a computer programmer, organisation and methods officer and consulting actuary. Mr Tan writes daily in his blog. The information in his blog is transparent and has an open approach.

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