This will have the most direct impact on the so called Investment Linked insurance policies which are invested in the Funds which are losing their value this year.
The decline was attributed to the pullback in global stock markets. Funds under the Central Provident Fund Investment Scheme (CPFIS) were down 4.06 per cent in the three months ended June 30, as investors dumped stocks for safer assets like bonds.Fund research firm Lipper said this market volatility is likely to continue into the coming quarters.
About 60 per cent of the 306 CPFIS-approved funds are investment-linked insurance products with the rest being unit-trusts.
Among all CPFIS-approved funds, equity funds lost more than 5 per cent while returns on multi-asset portfolios fell around 2.5 per cent. Bond funds were the best performers, gaining more than 1 per cent.
But seeing that saving money in the CPF Ordinary Account earns interest at a rate of 2.5 per cent, there seems to be very little incentive to invest one's CPF money.
http://www.channelnewsasia.com/stories/singaporebusinessnews/view/1223066/1/.html
