Savings life assurance worth a look

Savings lifeinsurance products require policyholders to pay shortterm premiums for five to seven years but offer longterm life pro¬tection for 10 to 15 years. The mini¬mum sum insured is Bt100,000Bt150,000, and policyholders will receive cash back during the protec¬tion period.

The premium is fixed according to the policyholder's age, which varies for each bank.

Customers can choose to pay the premium once a year, or pay in monthly instalments, or once in three months to six months. The pre¬mium will be slightly higher for instalment schemes.

Customers need to consider the total premium to be paid and the total benefit, both in terms of cash back and life protection. They also receive tax benefits depending on their tax base.

Below is a list of benefits policy¬holders will receive from this kind of product.

Bancassurance plans of Kasikornbank, Bangkok Bank and Standard Chartered Bank (Thai) offer savings life insurance that requires premium payments for seven years and provide 15 years of life protection, with a total benefit of 216 per cent, 232.5 per cent, and 250 per cent of the sum insured respec¬tively at the three banks.

For example, an initial sum insured of Bt100,000 requires annual premiums at Bt26,000 (for not over 35 years of age) at Kasikornbank,, Bt25,000 (for not over 50 years of age) at Bangkok Bank, and Bt27,120 (for 1759 years of age) at Standard Chartered. Thus, total premiums for seven years are Bt182,000, Bt175,000, and Bt189,840 respectively. The benefit is offered in form of cash back every year or every two years up.

Meanwhile, for tax benefit, the premium payment of a minimum 10year life insurance can be used to deduct from the annual income for individual tax calculation for up to Bt100,000 per year. Therefore, if customers need to pay tax of 10 per cent of their annual income, they will receive a tax benefit over seven years of Bt18,200, Bt17,500 and Bt18,984 from premium payment of Bancassurance of Kasikornbank, Bangkok Bank and Standard Chartered, respectively.

The net benefit after 15 years of life protection, excluding tax bene¬fit, will be Bt34,000, Bt57,500 and Bt60,160, respectively.

In case of death before the matu¬rity of the policy, Kasikornbank offers life protection at 100 per cent of the sum insured in the first three years, 120 per cent of the sum in the fourth year, 140 per cent in the fifth year, 160 per cent in the sixth year, 180 per cent in the seventh to 14th years and 200 per cent in the last year.

Bangkok Bank offers 100 per cent of the sum insured in the first three years, 140 per cent in the next two years, and 180 per cent from the sixth year onward.

Standard Chartered offers 100 per cent of the sum insured in the first three years, 150 per cent in the next three years, 175 per cent in the next three years and 200 per cent in the last six years. However, if the amount of the premium, which has been paid, is higher than the life pro¬tection, the whole premium will instead be redeemed as life protec¬tion.

Moreover, if the policyholders are admitted to the hospital, they will get income compensation of Bt1,000 per day for every Bt100,000 of the sum insured up to Bt5,000 per day for a maximum of 365 days. If they are treated in an intensive care unit or cardiac care unit, they will get double compensation per day for a maximum of seven days. This prod¬uct will be available at every branch of Standard Chartered until May 10.

Aside from the above policies, savings life insurance also has short¬er premium payment periods - as short as five and six years with pro¬tection periods at 10 and 14 years, respectively.

Siam Commercial Bank and Kasikornbank offer 14yearlife pro¬tection with six years of premium payment. They require initial sums ofBt150,000 and Bt100,000, respectively.

In case of the amount insured at both banks being Bt150,000, poli¬cyholders need to pay annual pre¬miums of Bt43,500 (for not over 50 years of age) and Bt45,750 (for not over 35 years of age), or total premi¬ums for six years at Bt261,000 and Bt274,500 respectively. If the cus¬tomer pays 10 per cent individual income tax, they will get tax benefits of Bt26,100 and Bt27,450, with max¬imum benefit of cash back at 224 per cent and 230 per cent of the sum insured, respectively. Policyholders will receive net benefit not includ¬ing tax benefit of Bt75,000 and Bt70,500.

Life protection is offered by Siam Commercial Bank and Kasikornbank at 200 per cent and 210 per cent respectively of the sum insured for the entire 14yearpro¬tection period.

Siam City Bank and Siam Commercial Bank provide 10year life insurance with five years of pre¬mium payment. The initial sum insured is Bt100,000, which requires annual premiums of Bt31,000 (for not over 35 years of age) and Bt49,500 (for not over 50), or total premiums over five years of Bt155,000 and Bt247,500 respec¬tively. If they need to pay income tax at 10 per cent, they will receive tax benefits at Bt15,500 and Bt24,750, respectively.

The maximum benefits of this product from Siam City Bank and Siam Commercial Bank are 188 per cent and 282 per cent of the sum insured. Therefore policyholders will receive net benefit not includ¬ing tax of Bt33,000 and Bt34,500, respectively.

Life protection is offered by Siam City Bank at 100 per cent of the sum insured for the first three years and 150 per cent of the sum in the last seven years, while Siam Commercial Bank offers life protection at 320 per cent of the sum insure for all 10 years.

Similar products pay eight years of premiums with 15 and 20 years of life protection with cash back, or pay six years of premiums with 10 and 12 years of life protection.

Details are available at all banks.