Expat term insurance: Zurich International Term Insurance+Futura + Rl360 LifePlan + Friends Provident International Protector Reviews

Quick note: this article was last updated on September 23. This article will be updated if there are relevant changes in the future.

Many expats in the UAE, Singapore, Hong Kong and beyond buy life and other kinds of insurance.

Whilst this can make sense, given that you are outside your country’s social security system, are all product offering equal value?

In this article I will be reviewing some of the most widely sold plans in the market, answering some frequently asked questions (FAQs) and suggesting some alternative options available to expats and locals who want international standard coverage.

For people with existing plans, I also suggest what you can do, if you are unhappy.

This article is long. For the time poor and those that want to contact me directly, please email me (adamfayed@hotmail.co.uk or adamfayed@int-amg).

Sometimes I can offer discounts on the online prices you see quoted, depending on the circumstances.

Where are these plans sold?

These plans used to be sold globally. In 2013–2015, however, Zurich and Friends Provident exited many markets.

These days, therefore, they tend to only be sold in 2–4 expats hubs, but there are many people with older plans.

Rl360 LifePlans are sold globally in over 100 countries.

What’s the difference between term insurance and whole of life insurance?

Before reviewing these plans, it is important for us to make a distinction between the two main types of insurance.

Term insurance is pure insurance. It isn’t connected to an investment. If you get 20 year term insurance, and you don’t die during this period, you won’t get anything back.

With whole of life insurance, it is connected to an investment. So even if you don’t die, you might make “a profit” from the insurance.

On first glance, whole of life seems the better deal. In general, however, term insurance is the better deal and getting investments separately.

This is because with term insurance, you are paying for the costs of the investment and insurance.

This typically means you get much less coverage on the insurance side, and sub-par investment returns, as the costs of the investment are high.

Zurich Futura Review

Zurich International is one of the biggest insurance firms in the world, and has offices in Qatar, the UAE and beyond.

It is no surprise then, that their insurance products are widely sold. Size doesn’t always equal better policies, however, and this is certainly the case with this policy.

It is more expensive than some of the other plans reviewed below, due to its whole of life nature.

So how do the plans work? In addition to the life coverage, one of the positives of the plans is that you can add many waivers.

Those include critical illness, family income, hospitalization, permanent disability and a few other options.

You also have flexibility in terms of which currency to pay the plans in, how often (say monthly or yearly) and you can adjust the premiums if your circumstances change.

You can also add or remove benefits and encash your policies if you no longer require it.

So what are the negatives? The main negatives are:

Zurich International Term Insurance Review

Compared to the Futura, the Zurich International Term Insurance is cheaper and an overall better product.

As this is term insurance, you won’t get anything back, however, if you don’t die during the term.

The key features of the plan are:

The positives of this plan are:

The negatives are:

Rl360 LifePlan Review

RL360 is an insurance and investment company based in the Isle of Man. Their LifePlan product is more akin to the Futura, in that it is a whole of life insurance which is linked to investment units.

The main features of this product are:

The positives of this plan are:

The negatives are:

Friends Provident International Protector Review

Friends Provident has offices in the Isle of Man, Hong Kong and Singapore and has decades of experience in the international expat investing and insurance scene.

The term insurance they offer is pretty solid. The options offered are:

Like most life plans, there are maximum ages for buying this insurance. That is, 65 for life cover, 55 for life total and total disability and 60 for critical illness.

The main positives of this plan are:

The main negatives are:

What about if you already have any of these four plans?

If you already have these plans there are 3 options:

  1. Keep paying in until the end.
  2. Stop paying and withdraw the money from the policy (in the case of the whole of life insurance). With term insurance stopping payments means you have no surrender benefits.
  3. Stop paying in but maintaining the money in the investments. In other words, you leave the investment component alone.

In general, if you are paying for term insurance already, it doesn’t make sense to switch to another provider, unless it is cheaper.

With whole of life insurance, it usually makes sense to withdraw money or stop payments, if you then buy cheaper term insurance.

For example, if you are paying $700 a month now with whole of life coverage, you might be able to get term coverage for $200 a month and invest the $500 into a low-cost investment.

The big mistake most people make is engaging in “loss aversion”. It is human nature to find losses at least twice as painful, as gains are pleasurable.

In other words, accepting a loss is painful, even if you can make up for the loss in just a few years.

So many people think “i don’t want to accept a loss considering I have already paid in 50k or 100k and can only get 20k back”.

Rationally and in terms of the maths, taking a hit can make sense medium to long-term.

Why do people buy the more expensive whole of life policies?

One of the main reasons is that people believe there is a “free lunch” where they can be insured, and get the benefits of an investment account. In reality, you pay for these things.

With term insurance, moreover, many people are worried about losing money if nothing happens.

However, insurance is merely a protection against statistically-speaking unlikely events.

Do expats need life, income and/or disability insurance?

Whether you need these insurances depends on many things. In particular it depends on:

In other words, if you are a government employee, that has been sent overseas, with full income protection, your situation is very different to a self-employed person with a volatile income.

Likewise, if you are married to somebody with a similar income to yourself, you are more protected, in many ways, than if the family has just one income to rely on.

What are the main negatives all 4 options have in common?

Two of these plans are much more expensive than the other two. All have the following negatives in common, however:

What are the risks with life insurance?

The main risks with life cover is that:

How are pre-existing conditions usually defined?

It differs depending on the insurer. Some insurers define it as a condition in which you have received treatment for in the last 5 years, and others define it in a more liberal or strict manner.

How can you have than one beneficiary?

Most life insurers allow you to pick multiple beneficiaries.

What if the predicted cost of coverage increases?

Whilst some insurers such as Friends Provident offers the 5 year guarantees, that doesn’t prevent insurance policies rising in all situations.

If this happens to you, you typically have 2 options; increase your premiums to retain the same benefits or lower your benefits and continue to pay the same premium.

How about the banks and local insurance firms?

In general, the expat banks charge a lot for life insurance. When it comes to local coverage, it depends on where you live and your circumstances.

In most situations, it makes sense to get expat coverage. Local coverage can make sense if:

I heard many insurance firms don’t pay upon death?

Provided you haven’t lied on your application form and have heard the exclusions, the policy should pay as expected.

The bigger issue is value for money, rather than not paying.

Do you offer insurance?

My main services are financial and investment management services. I do offer insurance.

I tend to prefer the lower-cost, online-based (or heavily technologically-dependent firms) as they can offer expats and indeed locals better insurance options, for a cheaper price with less hassles.

Sometimes I can offer discounts on the stated online price as well.

What are the biggest mistakes expats make with life insurance?

The biggest mistakes I have seen in the expat market are:

Conclusion

Most expats do not need whole of life policies, which are more expensive. Term insurance is cheaper, together with doing investments separately.

From the four policies reviewed here, two are much cheaper. However, these two options are more difficult to buy these days and/or cheaper options exist in the market.

The amount of life coverage you will need as an expat, will depend on several things, including your lifestyle and liquidity of assets.

In general, expat coverage makes sense. In certain, limited situations, getting local coverage can be worthwhile.

Further reading

For expats who have existing investment policies held offshore, the article below would be useful reading.

It includes countless comments at the bottom from people who hold the policies.

https://adamfayed.com/zurich-vista-review-rl360-quantum-friends-provident-hansard/

Owner at adamfayed.com.

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