The Simple Sum recently posted an article, “Your Guide to ILPs: What You’re Paying for When You Buy Investment-Linked Insurance Policies”.
It is a good read, especially for policyholders who may not be aware of the investment allocation or how the policy actually works.
It should be noted though that the article is based on traditional ILPs.
“New ILPs”, sometimes known as “101 ILP”, offers minimal insurance coverage and focuses more on investment. Premium is 100% invested before charges are deducted later on.
This “New ILP” offers a different kind of investment opportunity similar to that of unit trust investing, with added benefits and advantage by virtue of being an insurance policy, particularly in respect to estate planning.
It is an alternative that customers can consider, especially if to utilise its status as an insurance policy while maximising premiums (from first premium payment) for investments.
Financial Planning with M Farhan 