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Unit-Linked Products

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Reasons to buy Investment-Linked Product (ILP) as First Policy

  1. High transparency on premium utilisation
  2. Very low insurance charges during younger age.
  3. Unlike traditional life insurance product, you may include many riders without increasing the premium.
  4. Force saving plan
  5. Premium holiday
    1. Cash value to pay all insurance charges
  6. Adjustable insurance coverage in accordance with your need in different life stages.
  7. Withdrawal flexibility
  8. May have higher return but also higher risk.
  9. Risk reduction through “dollar cost averaging” investment strategy.

Disadvantages of ILP:
  1. High insurance charges during older age.
  2. Cash value not predictable, comparing to a normal life insurance, subject to investment return and prevailing marketing condition.
  3. Common misunderstanding that it is very “worthwhile” as can include many riders without increasing the premium. Actually all the charges will be deducted from the premium paid thus reducing the “cash value” that is available for investment


ILP may be the best product for younger working adult to start with a comprehensive risk management planning. It is advisable to have a few policy throughout different life stages to complement the earlier policy purchased.

Kong Hui Chong,
12 Aug 2010, 02:46