Which insurance plans should I get in my situation?

Hi Dahna,

Congrats on your the start of your work life. It's a great decision that you have done to have purchased a health insurance plan, as hospitalisation costs is one of the potential high expenditures in Singapore today.

Also in regards to converting from a WL (Whole Life) to Term, is premiums your main concern? Cause if you are looking for WL coverage for CI and TPD, I think only WL policies are able to do that. Term insurance only covers you for a specified period and to be covered for CI, it should be for WL as CI can occur at any phase of life.

Also for WL, are you paying a limited pay policy? meaning you should be paying for only X number of years and the policy will cover you for the whole of life.

Do reach out if you have further queries

Hi Dahna,

In order of importance, here is what you should be looking at:

1. Hospitalization plan. This covers any hospital bills and associated pre/post hospitalization costs. This would be from an integrated shield plan, with a rider to take care of the deductible/co-insurance. You have this already, so that's great.

2. Critical Illness coverage. This provides a sum of money for you to cover your expenses and other out of pocket costs should you fall critically ill and are not able to work. Usually recommended to cover at least 5 years of expenses and an additional sum to cover out of pocket costs. This is usually via a limited payment life plan, or a term plan, depending on your budget/needs. As you have stated, getting it via an ILP will result in escalating mortality charges over time, amongst other things that you need to consider. Before you drop it, make sure you have an alternative in place first. As you have stated, you wanted CI protection in old age, so a limited payment whole life plan might be the most suitable for you. Furthermore, some limited payment whole life plans do provide for TPD coverage for life, so you can also be covered for that in your retirement. You can speak to an independent financial advisor for more information.

3. Death coverage. This provides a lump sum of money should something happen to you. Not mandatory if you have no dependents or liabilities. Probably not something you need.

4. Personal Accident. For the minor stuff like TCM claims, etc.

5. Long Term Care. As a Singaporean Citizen or a PR, you'll be on Careshield Life when you turn 30. Something to think about in the future, not now, but essential if you are severely disabled in old age.

The first two are essential to have at the very least. Generally, you should not have to spend more than 10% of your income on coverage.

Work with an independent financial advisor who can provide multiple options and explain in detail what you will need to know before coming to a decision, especially with respect to cost effectiveness as well as the minor differences between the plans.