Friday, June 26, 2009

Which kind of insurance to start with...?

Someone told me on average, each Singaporean hold on to 7 policies. Also, a recent news article also state that a very high percentage of Singaporean will buy an insurance.

One thing is always, what kind of insurance to start off with?
-Life insurance?
-Medical insurance?
-Saving plan?
-Investment plan?

Factors to consider when buying insurance:
1. Financial status. Insurance premium cannot become a burden. Or else, it will defeat its purpose. A lot of people never consider this, thus terminate the policy in early stage and make big losses

2. Your financial consultant/planner/ advisor.
-Does he/she have sufficient product knowledge to recommend you the right policy?
-Is he/she working permanently, if not, you need to note that your policy will just be handed over to another person
-Lastly, sometimes, it good to see if your advisor have a good planning themselves...

3. Consider what is your responsibility now
- Do you have children and family to take care of? or are you single?
- If something happened to you, what are the things that become a worry? Your house? the amount of loans you owned.

Thus, in my opinion, it really depend on your piorities to decide the kind of insurance to purchase.

So, what kind of insurances should we buy? or rather, what kind of insurances do we need?

For high school students(poly, JC, uni)...
I would suggest a saving plan will be best. If obtain a saving plan from insurance company, it will likely to have come with some life insurance, so you protect yourself, at the same time, ensuring having a sum in the future.

As saving plan always have higher interest rate as compared to bank, also, at young age like 19, your life insurance will be lower. After 15years, at 34years old, you can get back all your $, by then you can choose to put it in investment or the uses one choose to.

Several insurance co. have come out with saving plan with low premium such that with the pocket money saved, they are able to afford it.

Such as AIA, prudential, manulife etc.

For Singles,
An important policy will be those of medical, like all the medishield related insurance. As singles, the worse thing can happen is to be hospitalise, the high amount of bill cannot be support by spouse, thus, need to secure oneself. (in my opinion of course)

For one with family and kids,
Life insurance is one that shouldnt be missed. However, do compare among different company as there is always a differ if you look carefully.

more to be updated..

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