Hospitalisation Insurance (H&S)
Critical Illness (CI)
Whole Life Insurance
Asked on 30 Jun 2020
I have hospitalisation, critical illness, whole life costing about $350 per month. Thanks!
A good guideline would be 10% of your income, gross. Remember that a part of your premiums are paid from medisave (for the hospitalization). If you are under 10%, that's great, but if not, it's still ok. You aren't paying 20% of your pay for coverage, which would be a concern if it was.
However, it's more important that you have the right types of insurance first (and in the right amount). At your age, you would need Critical Illness and Hospitalization at a minimum, with death/TPD coverage if you have dependents such as elderly parents whom you are supporting, or if you have impending liabilities such as a mortgage, or if you are planning to have kids.
Although I can't tell what your coverage is exactly, but you can use some simple rules of thumb to work out what you need.
10% is a good gauge in general. Of course, how much you pay will depend on how much you need and how much you need depends on your life stage. And that will mean ideally, your coverage should be able to cover your dependents (now and future).
This also applies if you are undergoing a transitionary phase where you are taking on liabilities, eg. mortgage loans, you might want to opt for higher coverage. This is to Ensure your partner will be able to support the obligations in the event of your unfortunate passing.
Do speak to a trusted advisor who can evaluate your coverage needs according to your life stage and Budget!
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Generally, the recommended amount to spend on Insurance products is 10% of your income. However, do note that this does differ for different individuals based on your personal financial commitments.
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It is more of how much you are being covered for, rather than the absolute cost.
CI coverage may be the most important for you if you are still single, without dependants.
Think about how much you would need in the event of CI.
When it happens, people will hope that they have more. But this should not be at the expense of monthly cost (affordability).
You exceed 10% if you have medical conditions that cause the cost of insurance to go up due to premium loading. If not, 10% is a good amount to cover all your shortfalls.
How much insurance coverage should You have?
As a general rule,
10% to 20% of your annual income on healthcare insurance and life insurance
Basic Life Cover = 10 times your annual income
Critical Illness Coverage = 5 times your annual income
There are a couple of factors that we need to clarify and plan before we can establish whether there is a need for death coverage. For example, do you have any dependents? Do you have any liabilities?
Total & Permanent Disability
Since you are alive and continues to live, there exists a need to be insured.
Similar to the rationale for Total & Permanent Disability, there exists a need for you to be insured.
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Hi Anon, before looking at premium, look at coverage.
Do you have 10 X Annual Income in the event of death and 5 X Annual Income in the event of Illness, and a Integrated Shield Plan with rider?
As long as you follow these rules and you start early enough plus are not unfortunate to be given premium loading, you will fall within 10% of your income as premiums.
30 Jun 2020
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