Today, I would like to talk about whether paid-up insurance is profitable in terms of insurance.
I would like to talk about the idea of canceling unnecessary insurance.
I was enrolled in foreign currency rip-off insurance (investment trust).
I want to cancel the contract, but if I cancel now, the money I get back will be less than the amount I have saved.
“By paying, I don’t have to pay monthly premiums in the future, and I don’t think I’ll lose money if I cancel in an emergency.”
was recommended by the insurance company.
The insurance company said, “If you want to cancel, you should make it a paid insurance.
If you make it a paid insurance, you don’t have to pay monthly premiums from now on, and the insurance will remain .
Now let me explain why the insurance company did their best to the end.
First, there are three reasons why you don’t need to purchase prepaid insurance.
- Because funds are tied up with low yields and low security
- Since the initial insurance is a bad product after all, even if the insurance content of the bad product is changed, it will be bad after all.
- If the special contract is also lost
Related article: Is high yield possible with savings insurance?
Example of general medical insurance
First, as an example of general medical insurance, the amount is really rough, but what is general savings insurance?
In this case, assume that you join at the age of 30 and pay a total of 3 million yen for 30 years until you turn 60.
Then, at maturity, you will receive 3.15 million yen.
You will have to pay a total of 3 million yen over 30 years, but when you turn 60, you will receive 3.15 million yen if nothing goes wrong, and there is also a little security.
Here is an example of general insurance.
What is Paid Insurance?
The plan to join at the age of 30 and pay 3 million yen until the age of 60 is the same as before.
Even if you can no longer pay premiums at the age of 45 in 15 years, or if you decide to cancel at this point, the amount to be paid will be 1.5 million yen.
The amount you have saved yourself is 1.5 million yen, and if you cancel the contract, the amount you will receive will be 1.1 million yen.
That means a loss of $400,000.
I don’t want everyone to lose money.
Therefore, we will change the contract to paid insurance.
So , the 1,100,000 yen returned after canceling the policy will be applied to the single premium , and the insurance contract will be changed.
Since the insurance premium for the entire insurance period is paid in a lump sum, there will be no monthly payments in the future.
We do not sign a new insurance contract based on this 1.1 million yen, but you can think of it as a new insurance contract once again.
I think it’s easier to imagine.
In other words, if you change to a new insurance, 1.1 million yen will be returned as 1.3 million yen 15 years later.
The money returned after canceling the policy is used to change to a policy with a lower coverage amount, so it is not possible with a non-refundable policy.
There is no need for that, but another feature of this insurance is that riders are basically gone, so you end up losing money.
recommended solutions
This time, the 1.5 million yen accumulated
- Cancel and receive 1,100,000 yen now
- Cancel at 1.1 million yen, change to 1.1 million yen paid insurance based on the returned 1.1 million yen, and receive, for example, 1.3 million yen 15 years later.
There are two methods of
If you change to paid insurance, you can continue the insurance again based on this 1.1 million yen, or you can change the contract content and continue the insurance.
What I want to say is that it’s like buying an investment trust with a rip-off fee with the money returned after canceling it.
As for what to do, I recommend that you cancel the contract by saying, “Cancel and receive 1.1 million yen now.”
Related article: I really want to learn how to invest! “Global Financial School (GFS)”
If you want insurance, you can get the minimum amount by throwing it away
This is the simplest.
In the end, both accumulation-type insurance and savings-type insurance are at a loss at the time of joining.
Insurance is insurance and investment is investment, so if you pay up to the end, you will not lose money, but with this savings type insurance, you will have an opportunity loss.
You get a much better return on your own investment.
Normally, if you want to invest, you buy an investment trust, but with savings insurance, you buy an investment trust through an insurance company.
So why bother buying mutual funds through insurance companies with high fees?
I think the reason is that “It’s hard to lose money.”
I know it’s hard, but this is the amount of studying.
After all, savings-type insurance is almost always a loss at the time of contract.
If you are bound by the same number of years, it is better to operate normally
In the previous example, if you pay 1.5 million yen and get 1.1 million yen back when you cancel the contract, you will lose 400,000 yen.
If the returned 1.1 million yen is used for investment, it will be 1.71 million yen at a yield of 3%.
If this 1.1 million yen is changed to paid insurance, it will be 1.2 million yen and 1.3 million yen.
Well, depending on the insurance company, the amount may go up and down, but if it’s only this amount, it’s better to operate normally if it’s tied to the same number of years after all.
Also, 3% yield is a pretty conservative figure, so it could be higher.
summary
After all, insurance is insurance, investment is investment, and even if you change the contract of a garbage-like product, garbage is garbage after all.
No matter how much you twist it, it is still a worthless commodity in the end.
So if you want to grow your money, you should invest, not buy insurance.
Insurance is insurance and investment is investment.
Also, as I have said many times, insurance with savings is a rip-off investment trust.
If you want to save 30 years, 20 years, you should operate it yourself.
Some people buy insurance because they want to increase their money, because it will increase, or because it is better than depositing it in a bank, but the essence of this investment trust is a rip-off.
If you want to be prepared for unforeseen circumstances such as death, you should consider non-payment insurance.
Loss cutting is mentally painful, and it is difficult to cancel when you end up losing money, and everyone hates losing money.
But you should be glad you just realized this.
If you look at the monthly installment, it is certainly more expensive than the non-repayment, but you should be happy that there were no accidents during the insurance period.
Until now, you may have paid high insurance premiums, but now you can join with low premiums.
Also, 90% of Japanese people have insurance, so there are almost no people who can do anything without failing, not just insurance.
If you cancel your insurance, you will have more cash on hand, which will give you a sense of security and make monthly payments easier.
Of course, the final judgment is up to each person, but it’s not that I deny anything, it’s just my personal opinion.
