Yield of 0% for 21 years of premium

Hi Kin Lian,
I have been following with great interest comments concerning the need for the insurers to be more transparent about the participating bonuses and surrender values and other related matters made by you and other distinguished professionals and the insurers themselves.

My wife is personally involved with her own policy as she was considering cashing out
her policy and using the money for other modes of investment. We were disappointed that the insurer would not bother to explain how they derived at the surrender value even though the offer is at odds with the documents that their office furnished my wife earlier.

Their financial planner (sales person really) briefly said that the difference between what we should be entitled as per the document and what we have been offered is due to the underlying value in their investments that have been impaired caused by the global financial crisis.

We would be agreeable for you or another person to use our case as an example of the lack of transparency in the industry, if indeed this is the case here.

SUMMARY OF KEY FIGURES
Annual premium for whole life policy $2,013
Duration of policy: 21 years
Cash value: $54,070
Yield over 21 years: 2.2% p.a.
Total premiums paid, inclusive of rider premium: $54,074 (yield 0.0%)

After paying premiums for 21 years, the policyholder just obtained the total premiums back. The yield is 0%. If the rider premiums are excluded, the yield is 2.2% p.a.