Insurance & Costs of having and raising a child

[brattzz]

choozm,

R u singaporean and has served NS? or ur spouse is singaporean and she is military?
Best term insurance policy now, being the cheapest and highest coverage, is aviva's NSF insurance, check it out!

---

choozm,

R u singaporean and has served NS? or ur spouse is singaporean and she is military?
Best term insurance policy now, being the cheapest and highest coverage, is aviva's NSF insurance, check it out!

[AlphaQuant]

Hi,

I would like to hear your opinion about early stage critical illness plan and CI plan. In post #45 (page 5) of this thread, d.o.g. explained the different types of insurance and their priority as follow:
1. H&S
2. Disability income
3. Term life (if there are liabilties that need to be paid)
4. Critical illness (optional)

In recent years, insurance companies started to introduce early stage critical illness plans that cover critical illness in early and intermediate stages.
So, is early stage critical illness plan necessary? What is the priority you would put for this kind of plan?


About my own coverage, currently, I have a death/TPD/CI term plan of $136,000, a shield plan with rider, and a disability income plan. Is $136,000 of CI coverage enough? What is the rule of thumb for CI coverage?

Thank you!

the post from d.o.g. previously has already summed up a lot of things excellently. the only thing i think of adding is:

how much more insurance coverage is going to cost on top of the below?
1. H&S
2. Disability income
3. Term life (if there are liabilties that need to be paid)
4. Critical illness (optional)

if it turns out that getting more insurance coverage (to supposedly give more assurance of mind) leads to financial stress, that might very well lead to lack of exercise/work stress/poor diet/poor family time which.....leads to poor health and hence illness. Isn't it then a vicious cycle?

my conclusion from all the readings and what happened to my family (relative had cancer with 2 kids):
1) one should follow d.o.g.'s post guide on the 4 insurances
2) save up and invest ur excess money sensibly for the long term
3) invest in ur health - eat well, sleep well, exercise well and laugh well

incidentally, after the incident with my relative, i came to the above conclusion, googled to browse ard and came across that excellent article by d.o.g. and started to post on this forum!

[choozm]

Hi yeokiwi, brattzz, AlphaQuant,

Thanks for your replies. I have updated my post with my personal info.

[yeokiwi]

Hi yeokiwi, brattzz, AlphaQuant,

Thanks for your replies. I have updated my post with my personal info.

About myself:
Male, non-smoker, age 37, single. No dependent.

Thank you!

The likely aftermaths of getting critical illness are
1) Pass away within a year or two. High Probability.
2) Recover fully and able to work in the same capacity. Low probability.
3) Survive but unable to work in the same capacity and requires personal care(helper, nurse etc). Low probability.

Scenario (1), if you have enough saving, it should not be a problem. Your kin will enjoy the critical illness payout.
Scenario (2), the critical illness payout helps to offset the cost but without it, you still can get on with your life.
Scenario (3), critical illness payout helps but it probably will not be enough.
Other scenario???

In your case, the third scenario is probably the one that will affect you the most. But, for this scenario, the insurance that is going to help most is in fact disability insurance. Critical illness payout will help to cushion the financial burden for scenario 3 but unless you buy a lot, it is not going to help in the long run.

Scenario 2 and 3 are low probability events though. But I think scenario 3, even with low probability of occurrence, is necessary for anyone, with or without dependents, to take up a disability insurance to guard against it. I noted that you have disability insurance but you may like to revise whether is it enough??

As for critical illness insurance, I think if it can help to cover part of the cost of medication and one or two expensive surgical operations, it should be good enough.

But anyway, I am not a certified financial planner, advisor or whatever. So, my advice does not worth much.

[Bibi]

So, is early stage critical illness plan necessary? What is the priority you would put for this kind of plan?


About my own coverage, currently, I have a death/TPD/CI term plan of $136,000, a shield plan with rider, and a disability income plan. Is $136,000 of CI coverage enough? What is the rule of thumb for CI coverage?

Early stage CI imo is expensive. If you have $20k savings, that might be sufficient to cover CI treatment. The chances of a person detected with early stage CI is low. Usually when one person discovers CI, its usually late stage liao. Even if one go for yearly medical checkup, one might not discover the cancer occurring in the body.

If you do not have savings to tide you through early stage CI treatment, then you might consider buying some. Death, disability income, CI, shield plan might not be of use if detected with early stage CI. I think shield plan does cover chemo therapy without need for hospitalization.

[NTL]

So, is early stage critical illness plan necessary? What is the priority you would put for this kind of plan?


About my own coverage, currently, I have a death/TPD/CI term plan of $136,000, a shield plan with rider, and a disability income plan. Is $136,000 of CI coverage enough? What is the rule of thumb for CI coverage?

Early stage CI imo is expensive. If you have $20k savings, that might be sufficient to cover CI treatment. The chances of a person detected with early stage CI is low. Usually when one person discovers CI, its usually late stage liao. Even if one go for yearly medical checkup, one might not discover the cancer occurring in the body.

If you do not have savings to tide you through early stage CI treatment, then you might consider buying some. Death, disability income, CI, shield plan might not be of use if detected with early stage CI. I think shield plan does cover chemo therapy without need for hospitalization.

Based on AIA illustration on the online brochure, the early payout amount (50% of sum assured) is around that of 25x annual premiums for a 34yr old. It does not seem attractive to me, as this is just a term plan.

I would disagree about detection of early CI is low. Breast Cancer, which is one of the most common cancer for female, should be easily detected when going for regular check up. Early CI should be payable even when the cancer is yet to spread.

Thus, whether early CI cover is suitable or not depend on whether you have any emergency cash to cover early treatment. Based on the illustration again, if you have $50k available for medical treatment, I guess you don't need to pay $1800/yr premium. It will be equivalent of getting a guarantee return of almost 4% for self-insuring. You may wish to talk to a professional planner to know exactly how much is actually needed for yourself.

IMHO.

[Bibi]

I would disagree about detection of early CI is low. Breast Cancer, which is one of the most common cancer for female, should be easily detected when going for regular check up. Early CI should be payable even when the cancer is yet to spread.

I would say, breast lump (even as small as 2cm) is easily detectable by checking the breast once a month. Those type of regular check up (ultra sound or mamogram) can further confirm whether those lumps are cyst type(liquid) or solid type. Solid type can be cancerous. However, only 1 out of 10 is cancerous for solid type. Further test is required to confirm if that solid lump is cancerous (i.e biopsy test). If the lump is small the cost of treating should not be expensive. I would think not more than 20k (if opt for public hospital) and portion of amt can be claimed from medisave/shield plan. If lump is big and cancer has spread but still within the breast (is that classify as late stage or still early stage?), the entire breast might need to be removed. It is not the removal of breast that is ex. It is the reconstruction of the breast that is very ex and i know this can be covered by shield plan. One might want to consider buying a hospitalization plan which covers the 10% co-payment portion as compared to buying a early stage CI plan.

Early CI can be cured but the treatment is not ex imo. A person can still work despite having early stage CI. If one cannot afford 20k, i believe one might not even want to buy early stage CI in the first place as these plans are ex and the payout is not fantastic.

[Traumfanger]

Guys. For endowment plans, ILP, wholelife, most products there are no specifics that any sum is guaranteed. We always see words like "illustrated", "non-guaranteed". Are there any guaranteed portion other than the assured amount from the insurance component?

From LIA..

What Do I Do When An Insurance Company Fails?
The Policy Owners' Protection (PPF) Scheme, administered by the Singapore Deposit Insurance Corporation (SDIC), automatically protects policy owners in the event a life or general insurer, which is a PPF Scheme member, fails.

All insurers registered by the Monetary Authority of Singapore (MAS) to carry on direct life business (other than captive insurers) or direct general business (other than captive insurers or specialist insurers) are required by law to be members of the PPF Scheme.

Customers of SDIC's Scheme Members get automatic protection under the Schemes - in the case of deposit insurance, up to S$50,000 per depositor per Scheme member; and for life insurance, 100% protection for the guaranteed benefits of the policy subject to caps, for example on the amount of sum assured and surrender value; and for general insurance, 100% protection for the insured policies, without being subject to caps.

The PPF Scheme for life insurance expands the scope of coverage to accident and health (A&H) policies. The coverage for life insurance has also been raised from 90% of protected liabilities to 100%, subject to caps.

It is quite vauge on the protection. When an insurance company fails,SDIC takes over the role? Or they make the payment straight? Thanks for any guidance!

[NTL]

Guys. For endowment plans, ILP, wholelife, most products there are no specifics that any sum is guaranteed. We always see words like "illustrated", "non-guaranteed". Are there any guaranteed portion other than the assured amount from the insurance component?

From LIA..

What Do I Do When An Insurance Company Fails?
The Policy Owners' Protection (PPF) Scheme, administered by the Singapore Deposit Insurance Corporation (SDIC), automatically protects policy owners in the event a life or general insurer, which is a PPF Scheme member, fails.

All insurers registered by the Monetary Authority of Singapore (MAS) to carry on direct life business (other than captive insurers) or direct general business (other than captive insurers or specialist insurers) are required by law to be members of the PPF Scheme.

Customers of SDIC's Scheme Members get automatic protection under the Schemes - in the case of deposit insurance, up to S$50,000 per depositor per Scheme member; and for life insurance, 100% protection for the guaranteed benefits of the policy subject to caps, for example on the amount of sum assured and surrender value; and for general insurance, 100% protection for the insured policies, without being subject to caps.

The PPF Scheme for life insurance expands the scope of coverage to accident and health (A&H) policies. The coverage for life insurance has also been raised from 90% of protected liabilities to 100%, subject to caps.

It is quite vauge on the protection. When an insurance company fails,SDIC takes over the role? Or they make the payment straight? Thanks for any guidance!

For whole life and endowment policies, there are guarantee sum in the left column, follow by 2 columns of non-guarantee sum based on different investment return. For ILP, there is no guarantee sum. You can check the 1st few pages of your policies. It should be indicated there.

As for how SDIC works when the insurance company fails, I have no idea... Will need to ask someone else who know more about the insurance industry.

[a74henry]

You need to visit your financial planner to check your financial health in Singapore at no obligation.

No fees payable until you buy the insurance products that match your needs.
There is also a free-look period.
If you decide not to continue with purchasing the insurance policy recommended by your financial planner,
you can inform the insurance company to stop the policy and get your refund within the free-look period.