Insurance protection

With rising costs and increased learning needs, financing our children's education is no longer a simple walk in the park. Discuss with other parents about how they are managing their finances to cope with their expenses.

Insurance protection

Postby Charmaine_chong » Thu Jun 24, 2010 10:03 am

Dear All,

Does anyone has $600k to a million insurance coverage for Death, total and permanent diability and critical illness?

Insurance coverage is very important especially when we have young kids and parents to rely on us. In the event of any occurence of the above, at least our dependent has a piece of mind of $$.

I happened to see a site, a man, non smoker, age 33 gets a million term plan for TPD + Death for 25 years policy term, with only $128.50 p.m.

My friend, female age 33yo, non smoker bought a term plan of $100k coverage (TPD+DEATH+TI+CI) from Aviva for $45 p.m which i think it is a bit expensive.

I have a whole life policy but it is not sufficient. I am looking for a term plan to get as much coverage as i can. Anyone has good recommendation of term plan?

Charmaine_chong
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Postby tree nymph » Thu Jun 24, 2010 11:19 am

Hi charmaine,

I agree that the million term plan is cheap at $128.50pm. But this is for 25 years, what happened after that? He is 33 now, so 25years later, he is just 58, where he will need coverage even more?

For your friend, do you know if there's a year limit? I think $100k maybe a little on the low side...

I'm also looking for one. But been the stingy me, i want a value for money one... :wink:

tree nymph
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Postby Charmaine_chong » Thu Jun 24, 2010 11:26 am

Dear All,

For those who are interested to find out more about insurance protection,
you may read out the following sites.

A blog by a financial adviser
(i am not his customer, simply find his articles very useful)
http://www.ifa-sg.com/protection-planni ... -articles/

Moneysense website
http://www.moneysense.gov.sg/publicatio ... tier1.html
http://www.moneysense.gov.sg/publicatio ... uides.html

Charmaine_chong
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Postby Charmaine_chong » Thu Jun 24, 2010 12:02 pm

Dear tree nymph,

You try to read out the blog, i am not his customer. Just happened to see it when i google for insurance. It is self explanatory and i think it will change people's mindset on how we look at insurance in the past.

Term plan is good to get extensive coverage with affortable price up to 30 years but the premium is non refundable, it means to say it is an expense. If you turn to whole life plan, the premium is very high and the coverage is far below what is required.

We need term policy especially we have young kids and parents to rely on us.

For me i will choose 25 years as during this period of time, my kids are young, should anything happen to me, this is the time that i need lots of $$ to pay for my kids education, daily expenses, loss in income, maid....

After 25 years later, my children are independant, they can make a living by themselves. I have no worry on this part by then.

I just need to ensure that i have
1.Whole life policy to covers whole life for TPD+death+CI
2.Hospitalisation & surgical plan (as charge feature by medisave approved private integrated plan)
3.cash or investment saving
4.Long term care policy to cover for disability after age 65 ( as Disability Income + Total permanent disability (TPD) coverage usually ends age 65)

For children's protection, my priority as follows.
1. Hospitalisation & surgical plan (as charged feature)
2. Life policy (whole life or term plan)
3. Education fund (for my case, i bought TM Asia life as the guarantee portion is higher when i bought it few years back)

Retirement for myself- this is something that i am clueless.

Charmaine_chong
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Postby Greenpink » Thu Jun 24, 2010 12:02 pm

For Term insurance, you may consider buying the SAF Group Insurance from Aviva. I think this is one of the cheapest Term insurance I've came across.

Your hubby (serve NS before) needs to be insured first and you as spouse will enjoy cheaper rate.

For the example above, for 100K Term - hubby will pay $12.80 per mth while spouse will pay only $10.00 per mth. I'm extracting this from an old brochure which I have with me now.

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Postby tree nymph » Fri Jun 25, 2010 8:13 am

Hi Charmaine,

Yes, i understand that there is no returns on Term Policy. Once the Term is up, the policy expires, full stop, end of story.

And I agree with you that during this time, we have kids and parents to support. but after that, we will also need protection as well because this is the time we fall sick most easily - or rather we get diagnose with critical illness the most often...

That is why i feel that 25 years is too short.

tree nymph
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Postby hquek » Fri Jun 25, 2010 9:09 am

hi tree_nymph,

Understand that bit about no returns. Just keep in mind that wool comes from the sheep. It's more a type of forced savings.

I bought insurance at various points in life, at times before I knew what I was doing. So in that sense I'm stuck with those plans.

But given a choice to start on a clean slate, I would:

1. get hospitalization/medical plans (based on as charged)
2. term insurance for life (in event of death, my dependents will be taken care of)
3. some insurance in event of total and permanent disability.

The money saved from not putting it with the insurers, I will choose to invest it elsewhere (buy unit trusts, shares, whatever). At least I have the flexibility to put in/withdraw when needed - now I have to pay month after month....and the returns not so fantastic. When there was scare I might lose my job, I still had to factor in these monthly payments (at least tong until cannot).

hquek
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Postby tree nymph » Fri Jun 25, 2010 9:16 am

Hi hquek,
Me too, have bought insurance in my various stages of life and there are a few policies that I've regretted taking up!

I was thinking more like if there are any term policies that offers medical/hospital up till like 75 or so? I think this kind of policy could be quite expensive.

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Postby hquek » Fri Jun 25, 2010 10:05 am

tree nymph wrote:Hi hquek,
Me too, have bought insurance in my various stages of life and there are a few policies that I've regretted taking up!

I was thinking more like if there are any term policies that offers medical/hospital up till like 75 or so? I think this kind of policy could be quite expensive.


Yah, I think we all have. Fully intending to share my experience with the kids so they can start on a better footing.

Honestly for medical/hospitalization, it may not be worth to get term up to 75, bearing in mind

1. as we age, more problems crop up. if you need to get a brand new plan, you could find many things being excluded - that's the reason why my 2 kids are on the 2nd most expensive incomeshield plans (downgrade plan don't need to underwrite, upgrade will need).

2. life expectancy is up, so you might find problems cropping up AFTER 75....if your plans expire when you are 76, likely no one is going to insure you. Then any medical bills leh? I have heard enough horror stories (1st/2nd hand) about high medical bills that cost a few apartments and cannot even cure. But you may want to find out from your agent about such plans - there MAY be.

I think I sound a bit like my insurance agent liao, but actually I don't feel I know a thing.

One thing that upsets me no end is their endless definitions of what = TPD, what = cancer. Some insurers I heard are extremely tight with their definitions, so if something does not fall within that, they don't pay.

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Postby Charmaine_chong » Fri Jun 25, 2010 10:17 am

Hi All,

In order to get good advise from licenced financial advisor, i find that usually fee based financial advisor does better job. Commission based financial adviser sells to meet target, sell products with high commission components, that is how they earn, instead of focus on clients needs. This is what i encountered so far.

I have ever called up a firm who provide fee based advise, they charge $100 per hour.

It takes about 2-4 hours to seek advise for insurance protection. nothing else.

If you need advise for financial planning for a family, it easily cost 3k plus.

Tree nymph,
Term plan is usually cover for TPD+CI+TI+Death for up to 30 years. I knew UOB life (now taken over buy prudential) has term plan that covers till age 99 or 100 with money return. If i am not wrong, HSBC has such plan too.

You need to get a H&S as charged feature, this is a must for everyone. Aside of this, we can buy LONG TERM CARE to take care of us in the event that one can't even perform daily activities eg: changing clothes on her own...

On top of getting insurance to get protection, we need a good habit to save cash regularly and do some investment.

Hi hquek,

For me, i spend quite a fair bit in insurance. Especially afer having 2 young kids, i am very worried if anything happen to me or my hubby, where is the money come from to pay for their daily expenses, education , etc. I hope insurance can lighten the burden should this happen.

Whole life is not for me at this age. It is too expensive and does not meet my objective.

Term life, yes. It helps me to get greater protection with much more affortable premium. The thing is as this is low commission product, usually financial advisor would not be interested to sell it to you.

I know I-term from NTUC, but based on my limited knowledge it is not the cheapest.

Charmaine_chong
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