After reading this I think I should buy loh, buy or not???
The table below shows the different between MRTA/MDTA and MLTA
| MRTA | MLTA | |
|---|---|---|
| Purpose | Protection | Protection, Saving & Cash Value |
| Protection | Reducing Protection throughout the loan tenure. | Protection is leveled throughout the loan tenure. |
| Transferability | Non transferable on New Purchase or Refinance. Premium will increase while age increases. | Transferable. One MLTA can be attached to Any Loan. Transferable on New Purchase or Refinance. |
| Cash Value | Reducing Cash Value throughout the loan tenure. Normally is much lower than Premium, and drop to RM0 at the end of loan tenure. | Fixed Cash Value (Guaranteed) throughout the loan tenure. Policy Holder will get back the paid premium in the future. |
| Nomination | Beneficiary is bank | Beneficiary can be anyone. |
| Payment | Lump Sum Payment or financed into Mortgage Loan. | Payment Mode can be Annually, Semi Annually, Quarterly or Monthly. |
| Premium | Low | High |
| Example on premium* | One time RM5,931.7 | RM303.60 monthly or RM3,643.20 yearly or RM109,296 throughout the tenure |
| Example if there is no death or TPD* | At the end of tenure owner will received RM0 | At the end of tenure, owner will received RM109,296 |
| Example if there is death or TPD** | Insurance company will pay the loan balance of RM186k to the bank & beneficiary will received the home. | Insurance company will pay the loan balance of RM186k to the bank & beneficiary will received the home plus RM50k cash |
* Example based on a loan owner at the age of 26 taking RM236k loan for 30 years
** Example based on loan remaining of RM186k
2 comments
From the example on total premium over 30 yrs:
MRTA: RM5,931.70
MLTA: RM109,296
There is a very big difference.
For MLTA, even with about RM110K value after 30 yrs, I'd say the RM103K difference (109-6) is better off for investment elsewhere.
And note that the low premium for the example is for a very young housebuyer aged 26.
I think it ties back to will you buy insurance solely for insurance? or will you consider insurance with investment? I was adviced if you want to invest look at other areas other than insurance :)