What you need to know about the new regulations on investment-linked insurance | Malay Mail

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What you need to know about the new regulations on investment-linked insurance

You will get an annual statement detailing your expected duration of cover. — Picture via RinggitPlusFrom 1 January 2020, all policy owners will receive a yearly statement which contains the expected duration of their insurance cover based on their current cash values .

Sample of a product illustration for an ILP policy that must be presented to an ILP customer at the point of sale. From 1 July,"Scenario X" must refer to return rates of 2%, while"Scenario Y" is set at 5%. This is applicable for all types of funds except for equity funds, for which the rates should be 2% and the 10-year average historical FTSE Bursa Malaysia KLCI returns for the first 20 years and then 5% after that. According to Bank Negara, the 2% and 5% rates better demonstrate the interactions between cash flows without giving rise to undue expectations. These set rates should help paint a uniformly realistic picture to potential customers when deciding whether to take on an ILP policy.

These new regulations can hopefully help consumers to make better and more informed decisions regarding their ILP insurance policies. — Picture via RinggitPlus All these new changes fall under Bank Negara’s overarching aim for investment-linked insurance products: to protect the interest of the consumers. From raising the MAR to improving transparency and standards of communication, these new regulations can hopefully help consumers to make better and more informed decisions regarding their ILP insurance policies.

 

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