Life Insurance Non-Forfeiture Options

Non-Forfeiture Options

• Automatic Premium Loan: Policy premiums are automatically paid from cash value if it is due at the end of the grace period.
• Option 2: Reduced Paid-Up Insurance: The policy continues without premiums, but the sum assured is reduced to the value that the cash value would buy at the life insured's attained age. The death benefit is 200% of the RPU Sum Assured. The future payouts are based on this RPU sum assured.
• Option 3: Extended Term Insurance: The policy continues without premiums as a non-participating Extended Term Insurance with a level ETI Sum Assured equal to 200% of the original Sum Assured less any outstanding policy loan and interest under this Policy. The duration of the ETI corresponds to the period of insurance coverage that would have been purchased by the cash value less any outstanding policy loan and interest at the attained age of the Life Insured at the time of the application of this option.
• Net Surrender Value: Upon termination of the policy the policyholder receives the cash value plus any accumulated non-guaranteed dividends and payouts less any indebtedness.

Reinstatement

• If the policy terminates due to non-payment of premiums or overloan, the policyholder may apply to reinstate it within three years.
• The policyholder must give satisfactory evidence of the Life Insured's health. They must also pay all premiums in arrears and any loan balance, with interest.

Grace Period

• A 31-day grace period is given to pay premiums.
• If no payment is received after the grace period, the selected Non-Forfeiture Option and Dividend option (if the selected option is used to pay a portion of the premium) shall apply.

Dividends

• Dividends may be paid to the policyholder in cash, applied to a due premium, or left to accumulate with interest at a rate set by the Company.
• The current Dividend Accumulation Rate is 4.00%.
• Dividends are not guaranteed.

Cash Values and Policy Loans

• Cash values start accumulating from the second policy year.
• Policyholders may apply for policy loans up to 80% of the cash value, charged interest at a rate set by the Company.
• Loans are payable on or before the next policy anniversary; if unpaid, they become a new loan with interest.

Surrender Benefit

• Upon surrender of the policy, the policyholder receives the available cash value plus any accumulated non-guaranteed dividends and payouts less any outstanding policy loans and interest.

Maturity Benefit

• If the Life Insured survives the policy maturity at age 100, they receive 200% of the Sum Assured plus any accumulated non-guaranteed dividends and accumulated payouts less any outstanding policy loans and interest.

Optional Riders

• Accident and Disability:
  • Total and Permanent Disability Plus
  • Accidental Death and Disablement Benefit
  • Personal Accident Rider
• Waiver of Premium:
  • Waiver of Premium on TPD
  • Payor Waiver of Premium Benefit

Premium and Sum Assured Information

• Premium Type: Level Premium.
• Allowable Sum Assured: There is no limit but subject to underwriting and reinsurer’s approval.
• Minimum Sum Assured: PhP 250,000.00
• Policy Fee: PhP 400 per year.
• Premium is Inclusive of the policy fee.
• Mode of Payments: Annual/Semi-Annual/Quarterly/Monthly.
• Modal Factors:
  • Annual: 1
  • Semi-Annual: 0.525
  • Quarterly: 0.285
  • Monthly: 0.0975
• Method of Payment: Credit/Debit Card, Mobile wallet/GCash, Checks, Bank Transfer/Fund, Bills Payment/Bayad Centers (applicable only for renewal/recurring payments)

Rider Information

• Accidental Death and Disablement Rider:
  • Available for individuals aged 18 to 59
  • Premium Payment Term: Either premium payment term chosen for the base plan or Expiry age (60) – life insured’s age; whichever is shorter
  • Benefit term: Up to age 60 of the life insured.
  • Cash Values: This rider has no cash values.
• Personal Accident Benefit Rider: This rider has no cash values.
• Payor Waiver of Premium Benefit:
  • Issue age: Life insured: 0 to 17, Payor: 18 to 59
  • Premium Payment Term: Either the premium payment term chosen for the base plan, Expiry age for Life Insured (25) – life insured’s age, or Expiry age for Payor (65) – life insured’s age; whichever is shorter
  • Benefit term: Up to age 25 of the life insured; or Up to age 65 of the Payor, whichever comes first.
  • Cash Values: This rider has no cash values.
• Issue age: 18 to 59
• Premium Payment Term: either the premium payment term chosen for the base plan or Expiry age (60) – life insured’s age; whichever is shorter
• Benefit term: Up to age 60 of the life insured.
• Cash Values: This rider has no cash values.

This quiz covers the various non-forfeiture options available in life insurance policies, including Automatic Premium Loan, Reduced Paid-Up Insurance, and Extended Term Insurance. It provides an overview of each option's implications on policy coverage and benefits. Test your knowledge on how these options work and their impact on the insured's financial planning.