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Anonymous
Term insurance
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Pang Zhe Liang
07 Jul 2020
Fee-Based Financial Advisory Manager at Financial Alliance Pte Ltd (IFA Firm)
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Hey there!
Most parents opt for a whole life coverage at the start for their children while generating a nominal cash value as well since whole life policies are participating in nature.
I think you have to be very clear as to the reason why you're getting it. If its for high coverage for a short period of time, then term works best and this is normally great for people during their essential working years. Otherwise, most parents will opt for a lifetime coverage while paying only for a short period of time (since the earlier you start, the cheaper it is).
Do sit down with a trusted financial advisor to evaluate your needs and life stage.
Financial planning is an integral part of life. You can reach me here to find out more.
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Tan Li Xing
07 Jul 2020
Financial Consultant at Prudential Assurance Company (Singapore)
Hi Anon,
I think that really depends on your situation. I know of parents who do buy insurance for ...
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This is a very broad question and let's start by understanding a term insurance policy.
More Details:
What is a Term Insurance Policy
Types of Term Insurance Policies in Singapore
Generally if affordability is an issue, then term insurance will become the natural option.
However, what happens when nothing happens 20 years down the road? In most cases, your child will take over the policy and continue to pay the premium in order to continue to be insured.
On the other hand, if he had a whole life insurance policy, then it is possible that the premium term has ended and he enjoys the full life insurance coverage for the rest of his life.
What's more, there exists cash value that you may be able to withdraw to offset the premium that you have paid previously, or as a gift for your child.
More Details:
What is a Participating Whole Life Insurance Singapore
When to buy Whole Life Insurance Singapore
On the whole, we need to understand how you wish to plan for your child's future, alongside with other factors such as affordaibility. This gives us a better assessment before we can give you responsible advice; rather than to second guess with some basic general advice.
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