It is important to have your car and home insured, but nothing is as important as getting yourself insured as you are your life’s greatest asset. As we move from place to place, find a partner, support a family, and maybe open a business, the significance of different types of essential insurance in a long-term plan becomes increasingly important. That is because insurance is all about supplying a financial safety net that will help you take care of yourself and those you love when you need it most.
In the event of unfortunate events such as terminal illnesses, permanent disabilities or even death, your family will have to bear large amounts of the financial burden if you do not have any coverage. Your parents might have to use their retirement funds, sell their home, reduce their own expenses or take huge loans to cover the cost of your misfortune. To spare your family any financial hurdles, get yourself covered with an insurance plan and allow your family to focus on rebuilding their lives.
Life insurance
The primary advantage of life insurance is the ability to cover your funeral costs and provide for those you leave behind. This is particularly important if you have a family that depends on your salary to pay the bills.
When evaluating the amount of life insurance you require, remember to include not only the funeral expenses but also the daily living costs. This may include mortgage payments, loan payments, credit card debt, tax payments, early childhood education, and future college tuition funds.
The three basic types of life insurance are whole life insurance, term life insurance and investment-linked plan (ILP). To determine which is best for you is dependent on your current earnings and priorities in life.
Whole life insurance can be instrumental in various parts of your life. As long as you continue to pay monthly premiums, the plan will keep you covered until you are no longer alive. It also comes with an increase in cash value.
Term life is a policy that is meant to cover you for a set amount of time and it mainly provides a death benefit. Term life plans are cheaper than whole life plans but they usually do not offer any cash-build up.
ILP is a combination of protection and investment. It is instrumental in gaining higher returns which will allow you to achieve your financial goals at a faster rate. You will also receive other forms of insurance coverage along the way.
Retirement insurance
Whether or not you plan to retire, retirement planning is extremely important as the future is uncertain. Your decision to continue working for many years to come may not be in your control—worst-case scenario, your health may deteriorate in the coming years and you may face retrenchment. To protect yourself from these uncertainties that may lead to financial problems in your later years, you need to start planning for your retirement now. That way, you get to enjoy a comfortable retirement with a steady stream of income and be free of any financial worries.
Health Insurance
With the ever-increasing healthcare costs paired with the ongoing global pandemic, health insurance is a must today. Health insurance provides people with much needed financial backup in times of medical emergencies. Health risks and uncertainties are part of our lives and we should always be prepared for them.
These are the following types of health insurance to consider:
Receive a fixed amount to cover high expenses if you are diagnosed with a major illness such as cancer.
This insurance plan ensures that you will receive financial support when you are disabled and unable to earn an income.
This type of insurance funds a big proportion of your medical cost. Should you require prolonged hospitalisation without this coverage, you may risk bankruptcy in the worst-case scenario.
At the end of the day, insurance serves to be a shield during your toughest days, it brings you a form of much-needed security during the most unstable periods of your life. Buying insurance is a huge decision for every Singaporean, especially during trying times such as now. That said, if you are passionate about helping others figure out their financial planning, KWO is the perfect place to start. Join us today!