Thursday, January 10, 2008

Get adequate life insurance on your life first

Dear Mr. Tan,

1. You advised me to have medical insurance for my daughter and to save in an investment linked plan with low charges. Do I need to buy other insurance for her, such as a critical illness policy?

Reply: There is no need to buy the critical illness plan. She can buy it later, when she starts to work.

2. When is the appropriate time to buy living insurance? If I buy living insurance, does it mean that I have to terminate the Medishield?

Reply: If you buy critical illness insurance, you do not need to terminate Medishield. They cover different types of expenses.

3. I only have living insurance coverage of 30K. Is this adequate? Do I need to buy a life insurance so that my family's financial needs are covered if something happens to me?

Reply: You should have adequate insurance on your life. Buy a decreasing Term insurance to cover up to 5 years of your income. Your priority is to have adequate insurance on your life. Do not worry about life insurance for your child at this time.

Read this FAQ:

1 comment:

Thomas Phua's Blog said...

Health minister has seen the NEED for medical coverage and made it compulsory for new born child to be insured with Medishield on an opt out basis.

This is a very good initiative.

Many think that a child is young and nothing should happen, but when it happen, it can be quite a financial strain.

A friend of mine told me his colleague has a 3 month old baby and got into fits, with eyes rolled up, and was warded for a month in hospital.

The total bill come to about $50,000. Then the scheme has not kicked in. Even if it has, the Basic Medishield may not cover well.

Shield Plans are basically the basic needs that one should not overlook.

Do not ever think, adult is more important to cover and child can wait.

I have seen many cases of children incurring high medical bills as well.

Any Shield Plan from any company is good, as long as one has ONE.

- Thomas Phua

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