Insurance for undergraduates

Hi, I will be 22 this year (Year 1 university student studying computer science), and I understand that one should be covered for 8-10x of their yearly salary for life insurance, and around 3x for critical illness. I am thinking of getting an insurance plan now since it is cheaper at my current age. However, since I don't currently have a salary, how much coverage should I be getting?

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Andy Chan

16 May 2021

Hello. As you have mentioned, the coverage for life insurance and critical illness insurance is typically based on your annual income. This is so that you can provide for your family/dependents for that number of years (or more) when you are gone or suffering from a CI.

However, you are not yet working, so you are not providing for anyone and you do not have people depending on you for income. Hence it may not be necessary to insure yourself against death and critical illness.

You can instead consider a hospitalization plan and/or a personal accident plan if your parents haven't already gotten those for you. If your parents have indeed gotten those plans for you, you can consider working out with them when you want to take over those plans. However, don't stress out about deciding when to take over the policies from them. The focus of your university should still be on investing in yourself - Focus on your studies; Tinker around; Network with people.

For myself, my dad bought a hospitalization plan and a whole life plan for me, and we agreed that I'll take over the policies when I've found a full-time job.