Dear Mr Tan,
I had a bad experience with my previous financial adviser who asked me to buy a expensive policy. I have lapse my policy as I find it too expensive and not practical.
I am a 28 years old, single. I do not want to spend too much in paying for higher premium. I know that Term Insurance is the most ideal. Which is better - Level or Decreasing Term?
My financial adviser recommended me a Term Insurance cover up to age of 65. I will be covered after 65 without paying premium. The premium is about $108.00 per month. The sum assured is $60,000. Is it good?
I have a NTUC M Incomeshield (previous known as MediShield) policy. My current financial adviser has advised me to top up $120 per year to enhance the coverage. I am also covered under my company insurance.
REPLY
It is best for you to ask a few insurance companies to quote to you the premium for term insurance. Read this FAQ:
http://www.tankinlian.com/faq/termd.html
Here are some benchmark rates for your reference:
http://www.tankinlian.com/faq/benchmark.html
The adviser is dishonest. He or she is selling a high cost whole life policy with premium payable up to age 65, and telling you that it is a low cost term insurance. If you buy a decreasing term insurance, you need to pay a much smaller premium.
As you are covered under your company scheme, there is no need for you to buy the enhanced plan.
You can lodge a complaint against these two advisers for giving you bad advice.
I have a friend who gave up Medishield because she has company medical benefit.
ReplyDeleteAt age 50, she contracted breast cancer, the company medical paid for her treatment.
She left her job at 55, and because of her breast cancer, though in remission, she is not able to get a Shield Plan.
Now she contracted liver cancer and is not covered by any medical insurance.
So whether to insure the Shield Plan when employed with medical benefit or not, is really something to think much harder.
The cost of paying for a Medisheld plan, or an enhanced plan, is far too high, to cover the small risk of getting continuing insurance after leaving a job.
ReplyDeleteSoon, there will be a cheaper ways to get this type of protection. For example, the company medical plan can be taken with an insurnace company that offers the continuity of cover. This will save $200 a year for the policyholder.
The saving of $200 can be invested to get additional money for retirement, instead of being wasted on a cover that is mostly unnecessary.