One key aspect of financial security is having adequate protection in the event of unexpected accidents or health scares. However, with the wide variety of offerings in the market, what are some of the considerations you should have before buying insurance?
#1 – Am I already insured?
Whether it may be a life insurance policy your parents bought or the general health insurance you enjoy as an employee, chances are you may already have some form of coverage. For starters, all Singaporeans and Permanent Residents are covered under MediShield Life, a basic health insurance that helps to pay for large hospital bills and costly outpatient treatments.
Take some time to review your existing cover, so that you can focus on filling in any gaps in protection rather than waste money on overlapping insurance (since you would most likely be able to claim from just one anyway).
#2 – What coverage do I need?
Just like how each tool in a toolbox has its own function, there are different types of insurance designed to meet different needs.
Life insurance provides a fixed payout when you are permanently disabled, critically ill, or have passed on, so that your family members are financially protected from the loss of your income. On the other hand, health insurance helps to pay for your medical expenses.
Find out the function each type of insurance serves here, and determine what is required to meet your individual needs.
#3 – Can I afford it?
At first glance, your insurance premiums may look inexpensive and affordable compared to your other expenses. Bear in mind though; they are recurring costs that will only increase with age.
Make sure you have enough, now and in the future, to take on this financial commitment.
Information accurate as at 17/7/2017