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I was browsing through some of the blogs when I saw Mr Tan's post on insurance. It's his usual style to advice people to buy term and invest the rest. But that doesn't attract me - it's this line:
"There is no need for people to have life insurance when they are old."
By 'life insurance', I take it that he means the whole life variety - those plans that gives a lump sum pay out in the event of death and total permanent disability of the insured person from the inception of the policy till age 100. This is very different from the very much cheaper term plan where a similar lump sum pay out will be paid out but it is usually up to age 65. However, life insurance these days come along with a critical illness (CI) rider that allows a lump sum payment when it strikes. Since this rider 'rides' onto the main plan of the whole life, which is up to age 100, the CI cover will also be up to age 100. I am under the impression that CI stand alone cover up to age 100 is either exorbitant in price or does not exist.
What do we need when we're old?
I think we need a comprehensive, as-charged hospitalization and surgery plans (H&S) that covers the expenses if you are hospitalized. The key word here is that you must be hospitalized locally, otherwise the H&S plans do not cover them. Some had mentioned that instead of using the CI cover that is usually attached to whole life plans these days (and covers up to age 100), we can use the H&S plans to replace CI cover from age 65 and beyond. While it's true that H&S plans cover treatment of CI, it's also relevant that H&S covers expenses ONLY if you're hospitalized in local hospitals. If you remember Charmaine's case, the little girl had to seek alternative cancer treatment overseas because the local hospitals do not have this particular drug (pardon me if I remember the details incorrectly). The cost turns out to be 350k USD and this huge sum definitely cannot be covered in the H&S plans unless you bought one of those special ones (not to forget, expensive ones) that covers overseas hospitalization bills as well. A lump sum payout by the CI rider will be very helpful in such cases. Even if it's not for overseas treatment, the lump sum is good for covering expenses related to the critical illness outside of hospitals, which is currently not covered under the H&S plans. Read more...[caption id="attachment_3388" align="alignright" width="150" caption="Photo by mr_bmonroe"][/caption]
I was browsing through some of the blogs when I saw Mr Tan's post on insurance. It's his usual style to advice people to buy term and invest the rest. But that doesn't attract me - it's this line:
"There is no need for people to have life insurance when they are old."
By 'life insurance', I take it that he means the whole life variety - those plans that gives a lump sum pay out in the event of death and total permanent disability of the insured person from the inception of the policy till age 100. This is very different from the very much cheaper term plan where a similar lump sum pay out will be paid out but it is usually up to age 65. However, life insurance these days come along with a critical illness (CI) rider that allows a lump sum payment when it strikes. Since this rider 'rides' onto the main plan of the whole life, which is up to age 100, the CI cover will also be up to age 100. I am under the impression that CI stand alone cover up to age 100 is either exorbitant in price or does not exist.
What do we need when we're old?
I think we need a comprehensive, as-charged hospitalization and surgery plans (H&S) that covers the expenses if you are hospitalized. The key word here is that you must be hospitalized locally, otherwise the H&S plans do not cover them. Some had mentioned that instead of using the CI cover that is usually attached to whole life plans these days (and covers up to age 100), we can use the H&S plans to replace CI cover from age 65 and beyond. While it's true that H&S plans cover treatment of CI, it's also relevant that H&S covers expenses ONLY if you're hospitalized in local hospitals. If you remember Charmaine's case, the little girl had to seek alternative cancer treatment overseas because the local hospitals do not have this particular drug (pardon me if I remember the details incorrectly). The cost turns out to be 350k USD and this huge sum definitely cannot be covered in the H&S plans unless you bought one of those special ones (not to forget, expensive ones) that covers overseas hospitalization bills as well. A lump sum payout by the CI rider will be very helpful in such cases. Even if it's not for overseas treatment, the lump sum is good for covering expenses related to the critical illness outside of hospitals, which is currently not covered under the H&S plans. Read more...
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I was browsing through some of the blogs when I saw Mr Tan's post on insurance. It's his usual style to advice people to buy term and invest the rest. But that doesn't attract me - it's this line:
"There is no need for people to have life insurance when they are old."
By 'life insurance', I take it that he means the whole life variety - those plans that gives a lump sum pay out in the event of death and total permanent disability of the insured person from the inception of the policy till age 100. This is very different from the very much cheaper term plan where a similar lump sum pay out will be paid out but it is usually up to age 65. However, life insurance these days come along with a critical illness (CI) rider that allows a lump sum payment when it strikes. Since this rider 'rides' onto the main plan of the whole life, which is up to age 100, the CI cover will also be up to age 100. I am under the impression that CI stand alone cover up to age 100 is either exorbitant in price or does not exist.
What do we need when we're old?
I think we need a comprehensive, as-charged hospitalization and surgery plans (H&S) that covers the expenses if you are hospitalized. The key word here is that you must be hospitalized locally, otherwise the H&S plans do not cover them. Some had mentioned that instead of using the CI cover that is usually attached to whole life plans these days (and covers up to age 100), we can use the H&S plans to replace CI cover from age 65 and beyond. While it's true that H&S plans cover treatment of CI, it's also relevant that H&S covers expenses ONLY if you're hospitalized in local hospitals. If you remember Charmaine's case, the little girl had to seek alternative cancer treatment overseas because the local hospitals do not have this particular drug (pardon me if I remember the details incorrectly). The cost turns out to be 350k USD and this huge sum definitely cannot be covered in the H&S plans unless you bought one of those special ones (not to forget, expensive ones) that covers overseas hospitalization bills as well. A lump sum payout by the CI rider will be very helpful in such cases. Even if it's not for overseas treatment, the lump sum is good for covering expenses related to the critical illness outside of hospitals, which is currently not covered under the H&S plans. Read more...
