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NTUC Income Vivolife (LVRP)
02 Nov 2013 (439 views)

RATING: AVOID

This is a whole life policy covering death, permanent total disability and dread disease, with premium payable for 20 years.

In this case study for a person aged 25, an annual premium of $2,458 is payable for 20 years. The policy covers a sum assured of $100,000 and bonuses are added to the policy each year, based on the rate declared by the company.

The bonus is quite low, so the company provides a minimum death benefit of $125,000 in the event of death or dread disease before age 70 or permanent total disability before 65.

The projected cash value at age 65 (i.e. duration of 40 years) is $69,000 to $115,000 based on the two projections.

The effect of deduction is between 45% to 50% of the accumulated premium. The high deduction results in a poor surrender value for the policyholder.

The policy provides an waiver of premium for up to 6 months in the event of retrenchment of the policyholder and can only be claimed once. This benefit is rather insignificant. 

The distribution cost of $2,772 is about 113% of the annual premium.  This is quite a high cost for the policyholder to bear.

If the policyholder were to invest the annual premium in an index fund to earn a yield of 3% to 5% per annum, the accumulated savings would amount to the following:

Annual premuim Term Yield End of 20 years End of 40 years
2458 20 3% $68,029 $122,868
2458 20 4% $76,122 $166,793
2458 20 5% $85,340 $226,432

There are considerably higher than the projected cash value paid under the policy.

If the consumer were to buy a term insurance (with dread disease cover) to provide the same cover, the cost of the insurance is likely to be less than 15% of the total premium. It is better for the consumer to consider this option.

I have give an rating of "avoid" for this product due to the high effect of deduction.

Read the PDF document for more details of this policy and to identify the relevant figures. to be considered in the evaluation.

Tan Kin Lian



NTUC Income Vivolife (LVRP)
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RATING: AVOID

This is a whole life policy covering death, permanent total disability and dread disease, with premium payable for 20 years.

In this case study for a person aged 25, an annual premium of $2,458 is payable for 20 years. The policy covers a sum assured of $100,000 and bonuses are added to the policy each year, based on the rate declared by the company.

The bonus is quite low, so the company provides a minimum death benefit of $125,000 in the event of death or dread disease before age 70 or permanent total disability before 65.

The projected cash value at age 65 (i.e. duration of 40 years) is $69,000 to $115,000 based on the two projections.

The effect of deduction is between 45% to 50% of the accumulated premium. The high deduction results in a poor surrender value for the policyholder.

The policy provides an waiver of premium for up to 6 months in the event of retrenchment of the policyholder and can only be claimed once. This benefit is rather insignificant. 

The distribution cost of $2,772 is about 113% of the annual premium.  This is quite a high cost for the policyholder to bear.

If the policyholder were to invest the annual premium in an index fund to earn a yield of 3% to 5% per annum, the accumulated savings would amount to the following:

Annual premuim Term Yield End of 20 years End of 40 years
2458 20 3% $68,029 $122,868
2458 20 4% $76,122 $166,793
2458 20 5% $85,340 $226,432

There are considerably higher than the projected cash value paid under the policy.

If the consumer were to buy a term insurance (with dread disease cover) to provide the same cover, the cost of the insurance is likely to be less than 15% of the total premium. It is better for the consumer to consider this option.

I have give an rating of "avoid" for this product due to the high effect of deduction.

Read the PDF document for more details of this policy and to identify the relevant figures. to be considered in the evaluation.

Tan Kin Lian