8 Tips to consider when Buying Term Insurance in Singapore

8 Tips to consider when Buying Term Insurance in Singapore – Insurance is something that many do not spend enough time to find out more about and also for some people, are under covered for.

For our series of articles on Insurance, we will be sharing some tips and also what is articles to help our potential customers and also friends find out what works for them and why.

The Covid-19 pandemic has caused more people to want to understand more about their insurance because it really shows how one can get into financial emergencies if illness befall them unknowingly.

*Note: This article does not constitute financial or insurance advice, you are still to consult a qualified professional to understand the packages before buying them*

So without further ado, let us start our article on “Tips to consider when Buying Term Insurance in Singapore”.

If you are keen to find out more about What is Term Insurance. Read our article here.


8 Tips to consider when Buying Term Insurance in Singapore


1. Why you should buy a Singapore Term Insurance

The golden question is always why?

The main reason most people buy term insurance is mainly to help pay for items at home especially if you have dependents and a family.

Some families only have one breadwinner and if any accidents or illness were to inflict them, the family may face financial difficulties.

The common coverage for persons who have dependents will usually buy insurance cover through term insurance to ensure that they are covered up till their children are of the age of being able to work and feed themselves.

Once your dependents do not need to rely on you, you might not have a need to have such high coverage anymore.

Term insurance gives you the freedom to decide the term of coverage and usually cost lesser than whole life plans.

For a parent that is trying to ensure that he or she does not pass on financial burdens to their offspring, it will be best for you to invest in a Singapore Term Insurance plan.


2. Riders that are optional (should be considered)

Most term plans only cover total and permanent disability and in the case of deaths.

But nowadays, with higher incidence of critical illnesses, one should be careful not to be under covered for critical illnesses.

Adding a rider is usually optional but highly recommended so that critical illnesses are covered for this particular person.

A very popular case of Rider usage is when any particular critical illness say cancer is diagnosed, one can receive a lumpsum pay out to assist with any financial needs.

A wise way of adding on riders is also to have one that will waive premiums if a person develops a critical illness and may not be able to make payments.

This will allow the said patient time to recuperate while having coverage.


3. Group Term Insurance 

Group Term Insurance are usually cheaper due to a grouping of people together to purchase term insurance coverage.

With more premium as a group, the coverage is lower per person.

Persons who are part of NTUC Unions or Singapore Armed Forces (SAF) can enjoy such privileges.

Some private companies also have opt-in or automatic group term insurance coverage to cover their employees.

Always remember to check the coverage you have for such packages.

For businesses that look to get Group Term Insurance coverage for their staff, they should also find out with their pioneer batch of employees if this will work better for them.


Tips to consider when Buying Term Insurance in Singapore


4. Comparing of Term Insurance Premiums across providers

The premium cost for Term Insurance can vary very widely across insurance providers.

The terms of the product may also vary across age, gender and sum assured.

One should consider making an educated choice when they are making plans on purchasing a Term Insurance in Singapore.

Also looking out for promotions that are currently available to take advantage of them.

Remember there are so many insurers in Singapore trying to get the business that you might be handing out, so always remember to compare before you make a decision.


5. Be clear of the covered Event

Event being the incidents that can happen to you or your insured person.

The particular “event” can be death or critical illness or permanent disability.

Make sure you understand what that means and also what particular incidents are covered.


6. Ensure you make your premium payments

Term Insurance policies do not have cash value attached to them.

This means that you run the risk of having a lapse in the policy if you do not make payment for whatever reasons beyond the grace period allowed by the insurer.

In the event of a policy lapse, the insured person will have to sign another declaration of good health to reinstate your policy.

This may be highly disadvantageous to those who may not be of good health.


7. Whether the Term Insurance is Renewable

If you are not sure how long you need to be covered, you can choose term plans that allow for renewability for extra term of coverage without having to go through underwriting.

Do note that renewable term insurance policies usually have higher premium than non-renewable ones.

The Flexibility allows you to make decisions on the go and whether you still need that coverage.


8. Tenure of Cover 

For consultants who are able to give you good advice, it will be great if you could have the coverage be able to cover your dependent needs or if you have any outstanding loans, the coverage should be enough to cover the outstanding loan periods.

For example, if you plan to retire by 55 or 60, you need to have enough to cover until you get CPF payouts.

It is important to determine the insurance coverage length to avoid paying unnecessary premiums when you do not need that coverage anymore.

For someone who is in their 20s, one can consider to cover till retirement, for someone who is a parent and have children, one can consider to cover until their children are financially independent.

Reviews can be done to top up for any housing loans to cover.

Avant Consulting is a Singapore Business Consultancy Firm that assist our clients with any B2B needs that you may have.

We work closely with businesses and business owners from all industry and walk of life to provide the highest quality B2B Services.

Our services as follow but not limited to:

  1. SME Loan
  2. Mortgage Loan
  3. Personal Loan
  4. Accounting Services
  5. Corporate Secretarial Services 
  6. Payroll Services
  7. Website Design & Development
  8. Search Engine Optimization Services

If you require such help, you can speak to us to find out more on how we can assist you as your trusted Singapore Business Consultants.

We work closely with financial consultants and insurance specialist to assist you with your needs for buying term insurance in Singapore as well.

As we are not qualified financial consultants, we do wish you could work with the partners that are to assist you on this needs.

Let us know if you require such help so that we can connect you with the necessary specialist.

Thank you for reading our article on “Tips to consider when Buying Term Insurance in Singapore”.

8 Tips to consider when Buying Term Insurance in Singapore