People have been debating about investment-linked insurance policies and whether they provide benefits for a long time. Some people are of the thought that investment and insurance should be separate and individual products. On the other hand, others see investment-linked insurance as a better option for its gains.
What’s investment-linked insurance?
Investment-linked insurance is a policy that protects one’s life and is an investment component. The life protection part covers a person when they’re permanently disabled or when death strikes. As a policyholder, you’ll pay the premiums depending on the timelines you choose, including monthly, quarterly, semi-yearly, or annually. If you want to get, the best and most affordable investment-linked insurance policies in Singapore, visit https://www.ocbc.com/personal-banking/insurance. With investment-linked insurance, you’ve got the option of adjusting your insurance protection based on your ability to make regular premium payments. You can also consider a wealth accumulation plan to assist you in adding some savings where you can later select funds depending on your risk profile. When it comes to investment, the insurance provider will pick some pre-packaged portfolio funds to assist partially active clients or who are willing to give a fund manager the duty of managing their portfolios.
Advantages of investment-linked insurance policies
An investment-linked insurance policy is more transparent than traditional policies. This is because it gives detailed information on all premium allocations. If you’re in doubt of the use of any premium, you can easily ask your provider to provide you with a periodic statement and analyze it. This statement contains all details about fund unit price, investment value, relevant insurance charges, and premium allocations. Apart from the report, you’ll also get an annual report detailing all components.
As you grow older, there are high chances that your protection needs will grow at a similar rate, especially after marriage, where you’ll have children. On the other hand, you’ll probably have independent children after retiring from work, meaning that your protection needs will be low. Therefore, in either case, investment-linked insurance policies give the policyholder the flexibility to move their premiums up or down depending on their needs.
Affordable insurance charges
Most people think of getting insurance policies when still young. This allows them to get low insurance charges. In the case of investment-linked insurance policies, how much you’ll be charged will largely depend on your age. If you’re young, you also have the advantage of getting high insurance coverage with minimal premiums.
Ability to control your investment strategy
Investment-linked insurance policies usually have a higher risk due to the investment component involved. However, as a policyholder, you have the option to control the investment risk involved. You have the flexibility to determine the best strategy, investment funds, and portfolio allocation options.
Better health benefits
You’ll get better health benefits if you’re an investment-linked insurance policyholder. This means that you can easily get your huge medical bills catered for without any limitation.
In conclusion, these are the top benefits of investment-linked insurance policies. You’ll also get tax benefits from this policy.