Did I make the right choice with AVIVA MyWholeLifePlan III?

Hello!

I think there is no need to feel too worried about being over-insured since you are a fresh grad as your income will only increase down the road :)

I started out with $80k base/$200k multiplier till age 70 for death/TPD/CI for about $1.6k/yr when my income then was $1.6k/mth. Only recently I decided to relook at my insurance coverage due to settling down and realising how much gap I have!

Currently my income is about $4.5k/mth and I bought another $50k base/$300k multiplier till age 70 for another $3.5k/yr for death/TPD/CI/ECI fully accelerated. Those who invest will buy term insurance instead so they will invest the difference but I do not like the idea of self-insuring and paying during my retirement years as I want to enjoy the fruits of my labour!

1) I'd like to think 10x is based on gross income so you can continue contributing to your CPF to build $$ for retirement if you are alive. Otherwise, it is for your family's sustenance and to clear liabilities under your name.

2) I think we may need to find out what your base is to determine whether the premium is "about there". Although I believe premiums shouldn't differ much across industries and I read somewhere amongst all life plans, aviva's plan is one of the best in terms of accumulated $$ in event of claims/no claims.

3) Check with your FA if you are able to get part of your refunds but I think you should think through carefully if it fits into your overall insurance policy.

Above all, I feel you should find an insurance agent whom you trust fully to buy the plan from!​​​

Hey there!

You should be paying not more than 10% of your annual income for insurance (assuming you opted for annual premiums). Anything else will be a stretch. This will include covering for hospitalization plans, CI and death/TPD.

Does your additional cover include additional riders? The cost of it will depend on whether there are Additional CI riders (do not reduce death benefit) or the multiplier that's used in your case. Usually, a higher multiplier (more protection during essential working years) are cheaper and have lesser cash value towards your retirement age. The converse is true as well.

If you forfeit your policy now, you may get very little or no cashback. You will have to look at the surrender value to see how much you'll be getting if you surrender it. But whether to surrender it will require a look at your finances now. Financial planning is an integral part of life. You can reach me here to find out more.​​​