by KCLau
During this week from Monday to Friday, I will post a series of Great Eastern insurance product reviews. It was schedules as below:
- Monday: Greatlife Portfolio Insurance (Regular premium investment-linked plan)
- Tuesday: Supreme Living Care Plus (Whole life living assurance policy with cash bonus)
- Wednesday: Great Junior/Income Advantage Series 2 (Whole life income plan)
- Thursday: Great Eduplanner (Education Endowment Plan)
- Friday: Supreme Care (Whole life non-participating plan)
Before the launch of Supreme Livin’ Care Plus (SLC+) back in 2005, there are several older “version” of this living assurance plan, such as Supreme Livin’ Care and Supreme Livin’ Care Series 2. When Bank Negara Malaysia (BNM) required a new implementation of traditional plan that apply the asset share method of cash value calculation, the introduction of SLC+ is the answer from Great Eastern Life Assurance Bhd.
Plan Description
SLC+ is a Whole Life Living Assurance policy with Cash Bonus, maturing at the age of 87. After the policy
has been in force for one year, a series of non-participating Deferred Whole Life as a percentage of Basic Sum Assured. I will explain about the deferred protection below.
Living Assurance provides a lump sum payment if you suffer one of the 36 critical illnesses/dread diseases. In layman term, SLC+ provides a lump sum to policyholder who either suffered from 36 critical illness, Total Permanent Disability (TPD), or Death whichever comes first. In insurance industry, these coverage are normally known as 3D.
What is 3D?
It is not three dimensions :). 3D refers to Death, Disability, Diseases which is the most common life protection provided by insurance companies.
This payment may allow you to take early retirement, pay off outstanding debts or even take a holiday – whatever you need to assist you with your recovery.
The lump sum amount payable is:
total sum assured = basic sum assured + deferred whole life sum assured
Total amount claimable * = Total Sum Assured + Accumulated Cash Bonus (if any) + terminal bonus (if any)
* Total Amount claimable is the amount of money you will get when you make a claim in the future.
Besides getting the protection, policyholders are also entitled to have
- Terminal Bonus on 3D for policies in force more than 20 years
- Cash Bonus – Starting from the end of the first year, Cash Bonus will be declared at the discretion of the Company annually on the Basic Sum Assured but this bonus is kept by the Company and the policyholder has to continue paying premiums.
What is whole life insurance?
A whole life insurance policy covers you for your entire life, not just for a specific period such as term insurance. Your death benefit and premium in most cases will remain the same. Whole life insurance also builds cash value, which is a return on a portion of your premiums that the insurance company invests.
Why is SLC+ so attractive?
Before the introduction of investment-linked policy in 21st century, Supreme Livin’Care series is one of the most popular traditional whole life plan. SLC+ is so attractive probably due to these factors:
- Guaranteed protection increment – the deferred Sum Assured explained below provides guaranteed increase in sum assured. For example, when a policyholder bought SLC+ at age 25, he will get guaranteed 140% protection amount 10 years later at age 35. This features provides hedge against inflation. You still pay the same amount of premium, but get a higher protection at later stage of life.
- Guaranteed premium – Due to the increasing probability of illnesses claim, most plan that provides 3D coverage in the local market doesn’t provide guaranteed premium. With the rapid enhancement of medical equipment and facilities, illnesses are diagnosed earlier, sometimes even before it becomes critical. Furthermore, due to the lack of exercise and defective diet, more and more people are contracted with cancer, kidney failure, heart attack, strokes and all sorts of dread diseases. So it is foreseen that the insurance premium will likely be raised in the future. Thus, the guaranteed premium feature will provide the peace of mind to policyholders.
- Cash value illustrated in the sales quotation is very conservative and most likely will be met by insurance companies. Based on the previous history of bonuses declared, meeting the projected cash value will not be a big issue for Great Eastern.
- Option to Buyback – in the event of life assured is diagnosed to be suffering from any one of the 36 illnesses covered (except Terminal Illness or Full-blown AIDS), the life assured shall be given the option to buyback the death benefit up to the maximum of the basic sum assured. It is commonly understood that when a person suffers from any of the 36 diseases, he will not be eligible for any new insurance protection. In other words, if you got cancer, you can’t buy any more insurance. However, the buyback options of SLC+ provides you a second chance to buy another policy that covers death only. When death occurs later, your beneficiaries can still claim the death benefit. In my understanding, SLC+ is the one and only plan in Malaysia that provides this advantage to policyholders.
You will be interested to own a SLC+ plan if….
- You are looking for a traditional plan that provides average protection with average cash values.
- You don’t like the fluctuation of fund performance that ties to investment-linked policies
- You are young and healthy
- You like the guaranteed features: guaranteed premium and guaranteed deferred sum assured
- You prefer conservative investment
- You want a 3D protection until very old age (87)
Deferred Protection
Now, let’s look at the deferred protection. In the policy of SLC+, this feature is called Deferred Whole Life (DWL).
Figure 1: Details of Deferred Whole Life
Refer figure 2 for the illustration of the sum assured with DWL. Picture worths a thousand words.
Figure 2: Illustration of Deferred Whole Life
Since you will still be paying the same amount of premium for the entire term (until age 87), you will feel that you are paying less and less premium, but getting more and more protection. Why is it so?
When you get more and more cash bonus every policy year, you will feel in a way that you actually pay less premium if you opt to withdraw the cash bonus. When the DWL kicks in at 2nd policy year, you will get more protection over time. That’s why I said that you will realize that you had actually “locked in the benefit of paying less premium for more protection in the future“.
Quotation Illustration
Since Cash Bonus and Terminal Bonus may vary depending on Company investment and operating performance, the illustrations show the possible level of benefits you may expect on two investment scenarios.
1. SCENARIO A = Assumes the participating fund earns 7.00% every year and the current operating experience of the Company continues
2. SCENARIO B = Assumes the participating fund earns 5.00% every year and the current operating experience of the Company continues
The bonus rates are greatly influenced by the capital appreciation of assets together with operating results and overall investment return experienced by the Company with respect to this type of plan. It will only be paid if the net returns earned by the Company support such bonuses. The actual bonuses payable may be higher or lower than illustrated.
For the purpose of this illustration, the bonuses shown in columns (K) and (L) are assumed. The bonuses included in the illustration have not been declared in the past. These bonuses are included based on the Company’s expectations of future operating results and the investment rate assumptions shown above.
Figure 3: A sample of SLC+ sales illustration generated with GELSIS 4.27
The quotation has 9 pages. If you are interested to read the quotation illustration in details, please contact me and provide relevant details such as date of birth, gender and budget.
Graphical Presentation
Figure 4: SLC+ graphical line chart illustration
Red line – Total benefit claimable
Green line – Cash value
Blue line – total premium paid
Do you notice that the green line intersect with the blue around 14th year? It means if you surrender the policy after 14 years, you will probably get back all the premium paid without interest. After that, you will get a return from your premium. The longer you pay the premium, the better is the return. Please refer my article that shows the Return of Investment of insurance policy.
Popular Supplementary Benefit – Reducing Term Rider Plus
Reducing term rider plus (RTRP) is a non-participating rider that give 3D coverage that reduces annually by level amount of initial sum assured for each completed policy year. There is a situation when this RTRP will come in handy. For example, you need a RM150,000 3D coverage. The premium is RM5145 p.a. for 30 years old male non-smoker. But you can only afford premium that is less than RM4000 a year.
To work with the tight budget, the SLC+ plan can be designed with basic sum assured of RM100,000, and additional RTRP of RM50,000. The premium is
- Basic SLC+ RM100k – premium is RM3430 p.a.
- RTRP RM50k – premium is RM186.50 p.a. only.
- Total premium = RM3616.50
You will still get the RM150k coverage. But of course the cash value will be less when compared with a basic plan of of SLC+. The increment of sum assured will be significantly at lower rate too.
Conclusion
Since there is no such plan as the best insurance plan, every insurance products has its potential market. Unlike Greatlife Portfolio Insurance that I reviewed yesterday, SLC+ is a traditional plan that provides conservative return and many guaranteed features. Some risk averse people will find it attractive. But those who are more aggressive would think that SLC+ is not so appealing to them. Talk to your insurance agent to plan your protection that suits your needs and circumstances.
Tomorrow I will share a plan that caters for retirement needs. Stay tuned!
By the way, if you have any question about SLC+, please feel free to voice out in the comment.
30 replies to "Supreme Livin’ Care Plus: Whole Life Living Assurance policy with Cash Bonus"
Hi KC, I know this is a very old post, not sure if you’ll see this. But I was actually trying to do some research regarding this policy (Supreme Livin’ Care Plus) & stumbled on your post. The policy was purchased by my parents 12 years ago and one that I have taken over to service ever since entering into working life.
I am now in a dilemma whether to continue or cancel this plan, as I have recently (2 years back) purchased a more comprehensive ILP that covers everything I need at this moment. Ironically, that ILP just cost slightly more (50 bucks more) than this Whole Life Living Assurance but has so much more coverage, covering all the protection pillars I need for now.
So from a pure bang for buck perspective, it’s a no brainer. But the ILP that I got was setup/designed by my current planner for insurance protection rather than “investment”, which meant that any leftover cash value is merely just to sustain the policy through the years (btw this is how I prefer it as well insurance for insurance, investments for investments). While on the other hand, the coverage on the Whole Life Living Assurance may not be much, but it has a cash & surrender value built into it that is growing exponentially.
The thing now is that the policy has reached slightly above breakeven if I were to surrender it today (surrender value + cash bonus), so doing so will free up cash flow for me (more to invest), & my coverage will fall back on the newer ILP that I purchased. But the opportunity cost is that I would lose out on the increasing benefits (coverage & cash value) which get better in the later years after holding on to it.
Some have advised that with the advancement & evolvement of insurance policies today, this Whole Life Living Assurance is considered obsolete today & I should just surrender it (case in point just by adding RM50 more, I get extensive coverage through the ILP), and better off to just take the excess money to invest elsewhere. While some are of the opinion that surrendering old policies is a bad idea, given that it has already built momentum, is no longer charged agent commission, and has an exponential & increasing cash value & benefit.
Any thoughts/advice from you would be appreciated!
I do it the same way too – buy the lowest premium policy (also ILPs) for my coverage needs.
Then whatever premium saved, it is for long-term investment.
If you continue paying the SLC premium, how much return are you getting?
Currently, it is around 4-7% p.a.
So if you can invest on your own with higher return, you should consider it.
Why is it at policy year 30 or on reaching 75, the DWL value drops by 50% ?
This mean the claim back is
Insured amount + DWL 50% of insured value +bonus.
Hi KC
I am helping my cousin to review her policy – Supreme Livingcare – Wholelife Living Assurance with Cash Bonu. As she mentioned in the policy there are medical benfits.
When I review, the rider is actually Hospitalisation and Surgical Benefits of value RM70.
As I understood, Hospitalisation and Surgical one should be on pay and claim basis one, there is medical card one. Then the RM70 is the Room and Board entitlement. But there is no Annual Limit and Lifetime Limit stated in the policy details.
Can you please advise the annual limit and lifetime limit that entitle under this rider of RM70?
If I am not mistaken, I think there is a limit imposed per hospitalisation. Therefore, there is no separate annual limit and lifetime limit.
It should be stated in your policy with details.
I lived in UK now but son in KL policy under GE since 2008, he’s in ICU recently and discharged today and I need to find out more about his critical illness plan that supposed includes in his policy plan as the policy not with me. Some insurance company did mentioned to me about critical illness plan is including admission to ICU, he was in there for 10 days, please advised . All I need to know the 36 CI plan or maybe now already added to more illness to his policy, I don’t have any updates
Thank you and please advised ASAP
Hi Taylor, the insurance company will pay if the doctor’s report match the illness defined in your son’s policy.
I am afraid that “admission to ICU” is not clear – what is the illness? And can the doctor write in the claim form, defining the illness your son has suffered from that match one of the illnesses defined in your policy?
You will have a better idea if you can find the policy. If you lose it, you can apply for a copy from GE.
Hi Taylor, if your policy is under GE, you can check the details of the policy you bought for your son by logging in here: econnect-my.greateasternlife.com If the policy is under you “Policy Owner”, then key in your IC number to register. Once you’ve registered your IC, you should be able to view all the policy you have under GE electronically under e-connect. I hope this helps to answer your question on how to find out if your son has a CI coverage. Good luck & all the best! If you need more info regarding your son’s policy, you may reach out to me @ e.julienlow@gmail.com.
Hello,
I do not know if you still answer but I have a SLC plus (10 years now) and cancer. What do you suggest the best I can do to benefit from this SLC plus?
Thank you.
Hi Nirmala, you can get in touch with me as our company is doing policy reviews for free for Malaysians and will suggest a proposal based on what you would need in the market today.
Policies have become cheaper and more efficient in terms of coverage, such as inflation tracker plans. You can get in touch with me on 0163126278. Cheers
How is the previous supreme living care different from the supreme living care plus? How long do i have to pay for the supreme living care? Finally, i understand that i can upgrade to purchase a supreme living care plus from my term care policy. But in that case, will my term care be removed?
Hi
Is there a policy called “Supreme Living Assurance with Reversionary Bonus 1”? How long is the tenure for this policy?
Regards
Chun Seng
hi,
where can i get the full infor for flexiplan whole life with cash bonus?
thanks
@ Desmond,
If you have this policy, you can contact Great Eastern to request a full quotation print up.
Hi,
i am planing to buy an insurance for my husband, but have no idea which suit him the best.
he is 41 year old with 1 child,11 yrs old.
he is currently holding a GREAT EASTERN FLEXIPLAN – WHOLE LIFE WITH SPECIAL BONUS. he bought it on 1995 , yearly premium rm3300.(still paying ?life 200k without medical card and critical illness.
his company insurance covered his medical and life of SGD200k
he plan to buy an extra insurance for family protection which is cover with critical illness. and life(no need the medical card because he is working oversea most of the time) -rm250k or the monthly premium of rm300-500.
in between traditional insurance and investment link, which one you think suit him the best ? any good insurance plan in the market now?
thank you in advance for your reply.
have a great day.
Hi KC,
I am a SLC policy holder. In genera in a whole life insurance plan, I understand we can withdraw the (cash value) that has accrued in our account. My question:
1. Does SLC has this option? if it is possible, then
2. It is considered a “loan’ from your own insurance policy?
3. How do you repay your “loan’ into your own policy?
4. Interest rates, is it fix? finally
5. How does getting cash out of your policy effect your lfe coverage?
If SLC does not have this option, does GE have such a product for whole life insrance that allows such flexibility?
many Thanks for your inside.
Dear Mr. KC,
I am SLC policy holder too. I would also love to know what is the correct answer or question posed by TW. My current understanding is as follows:
1. We can withdraw bonus and cash value.
2. Withdrawal of cash value is considered as policy loan.
3. Loan have to be repaid, just like bank.
4. Current interest rate @ 7.00%
5. It would not affect life coverage.
Keen for your answer.
Thanks.
For this SLC plan, if I buy this plan and survived throughout the period, what will I get back upon maturity ?
You will get the maturity benefit at age 87. It is the sum assured plus all the bonuses accumulated.
Hi KC,
I bought Supreme Living Care in yr 2002. Currently only I notice that the payor benefit was until yr 2015. I currently 35 years old. If I want to extend it to 55 years old, can you estimate how much will be the extra premium?
@ Pearly,
It depends on the sum assured stated in the policy.
It is better to contact your agent to work out the premium
hi,
I would like to double confirm with you regarding SLC SLC Plus. Does SLC contain Guaranteed protection increment? Or only SLC Plus have the benefit? How about Livin Care?
Hi KC,
I bought GE insurance in 2004. Supreme Livin‘ Care series 2.
Do GE still selling Supreme Livin‘ Care series 2 ?
If I want to top-up another sum assured RM25-30K only for 36CI & death, what would you suggest to buy ?
@ Dennis,
Your option is to top up with another traditional 3D plan or investment-linked plan.
36 Critical illnesses are covered till age 87
hi,may i know that will there be age limit for critical illness protection under this SLC plan as i know tpd will cease when age 65
Thankyou!
Hi Kelly,
The TPD and Death benefit comes together for any life insurance policy. It means you will get RM1 million TPD if you buy RM1m death benefit. If you want higher TPD benefit, the death benefit will rise as well.
I am a long time agent of GE. Of course I will handle your case if you want to buy from me.
Thanks!
Hi KC,
Can my coverage for TPD be higher than death? For instance, can i buy RM1M death benefit and RM2M coverage for TPD?
by the way, are you an agent of GE? if i decide to buy, can i buy from you?
1. the option is stated in the policy black and white. Please note that this option is only available to standard life (means those who are super healthy only – hypertension, disabled or other condition will not get this extra benefit)
2. normal premium rate, and non participating policy. Currently the only one available and meet the criteria is the Supreme Care whole life non-par plan.
3. I think GE is the first one to offer. There might be other companies offering similar plan. But I haven't known any up to date.
Hi KC,
i am looking to buy my first policy. Am interested on this product especially on the increasing sum assured. i got some questions regarding the buyback option below which i hope u can help me:-
Option to Buyback – in the event of life assured is diagnosed to be suffering from any one of the 36 illnesses covered (except Terminal Illness or Full-blown AIDS), the life assured shall be given the option to buyback the death benefit up to the maximum of the basic sum assured. It is commonly understood that when a person suffers from any of the 36 diseases, he will not be eligible for any new insurance protection. In other words, if you got cancer, you can’t buy any more insurance. However, the buyback options of SLC+ provides you a second chance to buy another policy that covers death only. When death occurs later, your beneficiaries can still claim the death benefit. In my understanding, SLC+ is the one and only plan in Malaysia that provides this advantage to policyholders.
1) is the option to buy back guaranteed? stated anywhere in black and white? i.e. in the policy?
2) the option to buy back the death benefit will be at the normal premium price or higher?
3) is GE the only insurer offering this option as of today?
thanks,
kelly =)