I just received a 100,000-baht return from an insurance policy after I paid the premiums for seven years. Actually I was given the option of keeping the money with the policy for 21 years with an annual return of 2%, but I rejected the offer because I believe I can make more than that. What's your advice?
_ BanraveeANSWERED BY...Teera Phutrakul, CFP, Chairman, TFPA Due to the historically low interest-rate environment over the past 10 years, people have been buying life insurance in droves because of the so-called guaranteed 4% annual return being offered by some life companies and the assumption that insurance companies cannot go bust.
Life insurance policies with an investment component cost more due to the embedded sales commission. Remember that the sole purpose of life insurance is to replace your income in case you die, so keep the two separate. Besides, there are better places to invest without the high commissions of life insurance policies.
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