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Saturday, August 29, 2009

How much should we be insured?

According to a report published a week ago, an average Singaporean needs life insurance protection of $494,851. However, an average life cover for today is only $165,628, which already includes mortgage insurance and CPF savings. The amount of protection needs should ensure it is sufficient to provide enough cash to maintain dependants' current living standards, cover any outstanding debts and funeral expenses.

I did a rough estimation that decades down the road, factoring in inflation and ever increasing hospitalisation fee that usually increases faster than inflation, I am not adequately insured. So, should I buy term, limited life, traditional life, or ILP to raise my current low insured amount to a more comfortable level?

S'poreans under-insured [via]


  1. Few factors that you can consider:

    For Critical Illness
    - Consider a limited pay whole life would be a better choice as critical illness will have a probability of striking in old age

    For Dependents
    - Consider a decreasing term reason being is that it is cheaper as compared to level term such that you can have a higher sum assured in the beginning years when you have more commitment ie. parents around and kids are still young

    For daily expenses and income replacement
    - Consider a disability income that would give a monthly income if the person is unable to fulfil OWN occupation needs

    Final Expenses and top up of existing coverage with limited budget
    - Consider an ILP or a level term if the amount of sum assured you are getting is constant throughout.

  2. I am yet to find out more on SAF Group Term Life Insurance.

    1. Are TPD and CI inclusive in the as-published monthly premium?

    2. Is it a level term or decreasing term? It looks like a level term at first glance.

    Should find out more when I have the time.


  3. SAF Group Term Life Insurance (Death and TPD only):
    - Level term insurance with fixed premium till 65 years old.
    - portable, covered even you are out of SAF/MINDEF or no more a NSman (Reservist).
    - Also cover for accidental death and TPD.
    - S$ 12.80 per S$ 100,000 coverage per month with some cashback every year made the cheapest in Singapore.

  4. I heard the CI for SAF Group Term Insurance can get quite costly as one ages.


Do provide your constructive comment. I appreciate that.

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