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A drop of 19.5% in surrender value over a few months
03 Sep 2021 (552 views)  

A policyholder received a post sale benefit illustration (PSBI) that shows the total surrender value as $106,830. 

A few months later, he recieved an actual quotation from AIA that the net surrender value is $85,988, a drop of $20,842 (19.5%). 

He asked for my advice on the correct figure that should be paid. 

My reply

You should be getting the total cash value of $106,830 unless this value has been revised downwards due to the current investment climate. 

The total cash value is stated as a "projected value, for illustration purpose". So, it is possible for AIA to cut the bonus that is projected. 

Another explanation for the difference could be that you did not pay some premium and the unpaid premium, with interest, is deducted from the total cash value.

You can ask AIA to explain why this figure has dropped.

Tan Kin Lian

A drop of 19.5% in surrender value over a few months
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A policyholder received a post sale benefit illustration (PSBI) that shows the total surrender value as $106,830. 

A few months later, he recieved an actual quotation from AIA that the net surrender value is $85,988, a drop of $20,842 (19.5%). 

He asked for my advice on the correct figure that should be paid. 

My reply

You should be getting the total cash value of $106,830 unless this value has been revised downwards due to the current investment climate. 

The total cash value is stated as a "projected value, for illustration purpose". So, it is possible for AIA to cut the bonus that is projected. 

Another explanation for the difference could be that you did not pay some premium and the unpaid premium, with interest, is deducted from the total cash value.

You can ask AIA to explain why this figure has dropped.

Tan Kin Lian

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