I am so confused about accumulating with profit. In CR it describes mainly UWP, which is fine. But why a UWP will be non-unitised? What are the differences, in layman term, between a non-unitised UWP policy and a CWP policy???
In both the differences are mainly of structure which leads to differences in source of surplus distributed: 1. UWP without any explicit charging structure: is a lot like CWP. Under this bonuses will reflect policyholders share of all the surplus. 2. UWP with a explicit charging structure: P/hs receive all investment surplus and s/hs receive rest through use of explicit charging structure. Explicitly deducted charges from the premiums (or unit fund), like: - Allocation rate - FMC - policy fee - risk charge deductions say for mortality benefit 3. In general the bonuses under UWP are more volatile than CWP - Often p/h just participating in investment surplus so can reasonably expect stronger corrlation between investment return and declared regular bonus. - Bonus applied to unit fund rather than sum assured so p/h views it a bit like a bank account and expects to see something like actual returns applied annually. That's some I can think about.... Cheers P
