Till what age should you cover with Multipay CI? Would you extend cover from 70 to 80 because of longer life expectancy and its waiver of premium clause?

Hi anon,

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Here's my take, but let me start by address your points first.

1. If you have the ability to afford the premiums in retirement, and you want the coverage to address your concern, then there's no issue in extending the duration of your coverage. It's about the peace of mind, not the money you pay for the policy
2. Longevity is actually a multiplier of all risks in retirement and so you may be justified in wanting to cover for a longer duration. Having said that, we simply do not know when, or even if, we will be diagnosed with something serious in life. That's just the unpredictability of life and thus some risks are simply not possible for us to absorb on our own. That's where we transfer the risks to the insurer.
3. As long as you do your numbers, plan conservatively (we don't get second chances in retirement to rebuild), and the premium does not affect your quality of life, then it's a viable option.
4. Likelihood of claims definitely increases with age, and we also cannot predict how medical advancements may actually turn CI into something that is easier to treat and improve survival chances in future.
5. Yes, once you are older, it is more expensive, and your health may not allow you to get coverage if there is a pre-existing condition
6. CI cover ensure that your children's own plans won't be derailed because they have to dig into their finances to come up with funds to support your treatment and recovery. They just need to dip into the payout. Even if you are retired with no income by then, you will still have to content with treatment costs that aren't covered by your hospitalization plan, so CI remains very relevant even in retirement.

Personally, I'll definitely have a waiver of premium on a multipay plan, so that if I am ever diagnosed, I will never have to worry about affording the premiums and can instead focus on recovery.

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I personally don't think I'll extend Multipay coverage past 75 as the total cost becomes prohibitively expensive, since its an exponential increase (your number of payable years go up in tandem with the premium, and the total cost is the product of those two numbers).

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If I want cover beyond 75, I usually will fall back on my whole life with CI plans, and that's also because while I do believe medical advancement will happen, short of a revolutionary breakthrough, chances are that if I am diagnosed with a CI after 75, I am not likely to be able to survive. If I do beat the odds, then the next occurence will likely kill me off fast. A morbid thought for sure, but probably the case for years to come. I have an uncle and an aunt, both passed from cancer in their 70s and 80s, and they went from diagnosis to death in less than 6 months for both of them.

Depends on your personal preference. Personally bought my multipay CI till 85 cause I don't see it just as an income replacement, but that I would need money to pay copayment, explore alternative treatments, change my lifestyle or hire a caregiver.