facebookWhat health insurance to buy? - Seedly

Anonymous

24 Apr 2019

Insurance

What health insurance to buy?

I am a fresh graduate and has just got my first job. I was wondering what health insurance cover plans should I get?
should I get a ILP ( e.g prudential ) or should I get a traditional health plan (personal accident, critical illness, life/death) , whereby I need only to pay premiums for the first 20years, but will be insured till for 100 years.

Lastly, which institution should I purchase the plan from, for example, Great eastern, AIA, Prudential.
I currently have a hospitalization plan .

Discussion (2)

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Hariz Arthur Maloy

24 Apr 2019

Independent Financial Advisor at Promiseland Independent

Hey Anon, a lot of misunderstood jargon and wrong terminologies here.

Health insurance is your hospitalization plan. Pays in the event you're hospitalized.

What you're looking at is life insurance. Pays when you die, when you fall ill, or in your old age so that you don't outlive your money.

Now look at how much life insurance you may need, and then how long do you want to be covered for.

Firstly, when you don't have any dependents, you only need to look at getting coverage in the event of falling ill, to replace your income as you'll be unable to work. This is what we call Critical Illness insurance.

The rule of thumb here is to get 5X your annual income as coverage. Should you fall critically ill, you'll have 5 years of your income set aside so that you can focus on recovery.

Now decide if you want this coverage until you stop working or up to a certain age, or to cover this for all your life.

I'm a big believer in getting CI cover for life. This can be done by purchasing a Whole of Life policy with CI benefits as riders.

Later in your life, when you have dependents, a spouse and kids for example, or a liability like a mortgage or a business loan, then you can consider getting coverage that pays in the event of death.

The rule of thumb is about 10X your annual income. For the duration, I'm sure that you'll only need that coverage to last only for a specific number of years, for this you can purchase a term policy that expires when your dependents don't depend on you anymore or after the liability is cleared.

Lastly, when planning for life insurance, choose the doctor, and not the hospital. So work with an advisor you trust, as they're the one providing you the advice and prescribing you the medicine you need to take. The hospital (the insurance company) matters less. All products are pretty much the same. You die I pay, you fall sick I pay.

But if you want a doctor that can work with multiple hospitals and pharmacies, choose to work with an Independent Financial Advisor Rep like myself. I can distribute for almost all the insurance companies in Singapore and are constantly comparing their plans to find the best value for our clients. All the best.

Clarence Chua

24 Apr 2019

Financial Planning Specialist at Prudential Assurance Singapore

Hey there,

Welcome to the workforce! 😆

The type of plans you mentioned has different structures though the primary purpose are still for wealth protection.

Get a plan that suit your needs (be it term, whole life or ILP).

Understand how they work, seek out professional advice base on your circumstances and get the plan you think is best suited for you.

I will recommend you to get from an advisor that you are comfortable with and not so much focus on the company. All 3 companies you mentioned above are great companies.

The same types of plans in the market are also 80-90% similar in their structure even if they are different companies. So choose the advisor first then the company, I will say.

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