KCLau's Money Tips Forum

[wongly]

Hi Mr Lau
Have been following your blog for quite sometimes.
Probably one of the most informative blogs by Malaysia financial consultant.
Thanks for taking your time to share your experience.
Anyway, I have a question for you..
I have bought this plan 2 years ago..
Prulink plan
Life/TPD: RM100K
36C.I: RM70K
P.A: RM50K
Medical Card: RM62.5K/year; RM187,500/lifetime
Daily hospital cash allowance: RM50/day
Autosave in case of diagnosis of C.I.
20 year (age 44) Projected value RM78,000

while before that, around 2004, I have bought this
ERM LIFE PREM REFUND WITH CI (Manulife / John Hancock )
Policy Start date 10/Aug/04
Maturity Date : 10/aug/24
Issue Age : 23
Monthly Premium : RM46
Face amount : 50000
Disability amount : 50000
Face value for year 3,4,5 = 60%, year 20 = 100%
So with RM552/year I can enjoy "100% Cash Back without interest" if continue the plan for 20years (age 43 matured), cash back value will be RM552x20= RM11,040.
By Aug08, the amount i pay is RM552x4= RM2208. If i cancel the plan, i can get back RM2,208x60%=RM1,324...
I am thinking of canceling this manulife plan.
Can you please give advice whether I should do so ?
Although I can receive 100% cash back after 20 years, but probably RM11,040 wont be much after inflation...
Thanks for your time!

From Wong, KL

[KCLau]

Hi Wongly,

The worst advice from an insurance agent is "to lapse your policy"

The biggest chunk of commission is during the first few years. I would keep the policy.
Unless you really think that the protection given by the Manulife policy is no longer needed.

Refer my article about policy lapse:
http://kclau.com/insurance/replacement-of-insurance-policy/

[wongly]

Hi !
Thanks for the fast reply.
I remember reading that article last time.
I did ask my insurance agent about this, luckily he ask me not to cancel the policy, as my cash back value is low.However, since the protection of the manulife isnt much, i might cancel it. Perhaps, I can cancel and use the money to top-up my current prulink plan?
Once again, appreciate your reply

Wongly