Types of policies
Most people would have at least 1 or 2 insurance policies and they
think that they are covered completely. Well that is what they all
think. Problem is when something happens
to them, they will start questioning why they are not covered, but
by then, it would already be too late. So it is very important to
find out what policies you have, and what
kind of coverage they provide, as some policies cover multiple type
of incidents, while most do not. So let me briefly share with you
what are the types of policies around.
Whole Life policies
They provide a lump sum of money upon death of the insured, or
Total Permanent Disability, which will be paid out in
installments.
Inclusive of
Term policies - you pay the premium annually subjected to your age,
older you are higher the premium. There is no cash value and you
get nothing back at the end.
Life policies - you pay a fixed premium until the policy matures,
upon maturity you will get back a sum of money aka the cash value
of your policy.
Endowment policies - you pay a fixed premium until maturity where
you will get back the cash value of your policy + a maturity
bonus.
Annuity - Provides you with a steady income over a period of time
upon retirement or anytime you wish to start.
Healthcare Policies
Hospital and surgical - Typically covers inpatient outpatient and
surgical cost. Coverage and claim amount differs per plan. Yearly
renewable. Eg Medishield
Disability income - Pay you a % (usually 75%) of your last drawn
pay should you be unable to continue working due to an accident or
illness.
Long Term Care - Provides you with a monthly income should you be
unable to perform a set number of Activities of Daily Living. Eg
ElderShield
Hospital Cash - Provides you with daily income for being
hospitalized.
Critical Illness- Provides you with a lump sum of money upon
diagnosis of any of the 30 major critical illnesses.
Others
Company Insurance - Depends on what your company bought for you, it
can be a life policy or a healthcare, or even both. So do check to
find out what coverage you are entitled.
Most people have a life policy or an endowment policy, and think
they are covered for everything. But I have just list out 8
different policies that provide different types of
coverage. As such you should really find out what kind of coverage
you are lacking or missing. What everyone needs is a H&S policy
and a LTC policy, and while the government
has in a way forced us to buy a policy for both, the coverage
provided is really very little. And when the time comes that a
claim is needed to be made, you will find out that
you have a lot of limitations in claiming.
Another point to note is that at different stages in life, we have
different needs.
Young and single - Endowment
Young and married - Life
Married with kids - Life & disability
Retired and old - Annuity H&S CI LTC
But for everyone H&S is a must. Everyone knows how high
healthcare cost are, and to be sick is worse than death in
Singapore. So protect yourself, and your family from
financial woes that will be cause by healthcare prices.