Insurance is not something that many Singaporeans like to talk about. In fact, it is not uncommon for people to avoid insurance agents in shopping centres or to ignore their phone calls. More often than not, this negative attitude stems from a lack of understanding that insurance is a crucial part of a sound financial plan.
When people talk about financial planning, the primary focus is almost always about saving money and cutting back on unnecessary expenses to accumulate even more wealth. Sadly, not enough attention is given to protecting those properties—and oneself— in case of unfortunate events.
If you are one of those who believe that saving money is enough for now and getting insurance can wait, you are mistaken. Insurance should be high on your priority list for the following reasons:
Thousands of People Get Injured, and Hundreds Die in Road Accidents in Singapore Every Year
While you may dismiss the possibility of experiencing accident-related injury or death at the prime of your life, the truth is, you can never really tell. You may be crossing the street one day and get hit by a speeding car. You can fall on your back and injure your spine. Again, you never know.
The Singapore Police Force recorded nearly 10,000 road accident casualties in 2019 alone. More than 9,000 Singapore residents and non-residents suffered injuries, and over a hundred died. Include the number of injuries and fatalities from other types of accidents, and you will realize that accidents can happen to anyone—even you.
While insurance cannot prevent accidents, securing the right plan can offer a financial safety net for such incidents. For instance, whole life insurance can give you a lump sum pay-out should you become permanently disabled and unable to work anymore.
In case you pass away unexpectedly, your family will receive the money, so they do not have to worry about finances. Isn’t it reassuring to know that you can still provide for the needs of your family even when you are gone? When buying life insurance, make sure to first check the CompareFirst insurance information portal, a website that allows you to compare life insurance products in Singapore.
1 in 4 Singaporean Will Likely Develop Cancer in Their Lifetime
Just because you are young and healthy does not mean you cannot suffer from a critical condition like cancer. According to the Singapore Cancer Society, 39 people are diagnosed with cancer every day, and 1 in 4 residents will most likely develop cancer in their lifetime. Given these numbers, it is not surprising that cancer is the leading cause of death among Singaporeans for several years now.
Just like accidents, you can never tell if and when you will be diagnosed with a critical illness. And since the treatment and hospitalisation costs for cancer and similar diseases are expensive, you need to be financially prepared should the unthinkable happen.
You may not realise it yet, but your MediShield Life and MediSave are not enough to support your medical needs. You will drain your savings in an instant unless you purchase health plans that complement and strengthen your basic Medishield Life insurance.
Securing critical illness insurance is also helpful as it provides a lump sum payout when you get diagnosed with a critical illness. Such plans offer money for non-medical expenses like childcare and utility bills, unlike ordinary health insurance that merely covers medical expenses.
25% of Seniors in Singapore are Still Working
Seeing elderly uncles and aunties wiping tables and cleaning floors at hawker centres and other establishments is a familiar sight in the Lion City. The employment rate for those aged 65 and above are rising continuously.
Today, 1 in 4 seniors are still working to support themselves. While there are a few who like working to stay active, many cannot afford to retire and enjoy their life because they do not have the means to support themselves financially.
If you do not want to spend your later years in the same way, you need to prepare for your retirement early. Instead of merely relying on your CPF Life, it is best to complement it with another retirement insurance plan. With the right insurance, you can travel the world, pursue your passions, and live the lifestyle you want in your retirement years.
Tertiary Education in Singapore Is Not Cheap
Parenthood comes with numerous responsibilities. Besides providing for your child’s physical and emotional needs, you also need to ensure that they receive a good education. While primary and secondary schooling in Singapore is relatively affordable for citizens and residents, tertiary education is another matter.
It will cost you at least SGD8,000 per year to send your child to a public university. This amount excludes expenses for books, allowance, food, transportation, and other miscellaneous costs. You will probably need at least SGD60,000 for your child to complete a four-year program.
Trying to save thousands of dollars in a savings account may seem prudent, but it is an inefficient way to accumulate money because of low interest rates and inflation. What you need is an endowment plan that offers guaranteed and non-guaranteed return to be paid out at a fixed time, say when your child enters university.
Many endowment plans offer a rider which guarantees continuous payout in case the parent passes away. With this type of insurance, you are securing your child’s education even if you are no longer around.
The Majority of Singaporeans Are Anxious About Economic Issues
A recent anxiety study by communications firm Wunderman Thompson Singapore found that 78 per cent of Singaporeans are bothered by economic issues like cost of living. This result is unsurprising, considering that Singapore is one of the most expensive cities in the world.
Do not let yourself be burdened by the same concerns by finding the right types of insurance policies to protect your interests. Whether you realise it or not, insurance offers peace of mind. With the right coverage, you do not have to be anxious about your family’s future even during trying times.
The discussion points above clearly show that getting insurance is not just a senseless expense but a wise decision. Keep in mind that the only thing certain about life is uncertainty. With the right type of insurance, you can protect yourself and your family from the financial burden of unfortunate happenings. More importantly, having insurance gives you the chance to live the life you want in the coming years.