Life Insurance for Young Parents – Protect Your Loved Ones, Young and Old
From a financial standpoint, it’s not easy being a young parent in Singapore.
As a young parent, you’re likely to be in a sandwich generation where you have young children to care for, as well as ageing parents who are likely entering or have just entered retirement.
Given the high cost of living in Singapore and other financial commitments like your children’s education, your mortgage, and maybe a car loan, it’s hard to imagine not working and living without an income.
That’s why it’s important to have life insurance as a vital safety net for your family when it comes to your financial security – especially with rising healthcare costs in Singapore (Source: CNA). Remember, planning your life insurance coverage early is an important step in financial planning for you and your loved ones.
Let us explain.
Why Life Insurance is Important for Your Family’s Future
It might sound a little strange at first, but getting life insurance really is an expression of love and responsibility.
At its core, life insurance is a safety net that helps your family’s financial well-being, should something unforeseen happen to you. In a sense, you are making a dutiful investment into your family’s future and peace of mind, so they are able to live their lives to the fullest, even if you are no longer able to provide for them.
This means that they can maintain their existing lifestyle and your children can continue with their (often expensive) higher education even if you were diagnosed with a critical illness or disability. Yes, unlike what many may think, life insurance is so much more than just coverage for death.
The Essential Roles of Life Insurance for Your Family
Now that you understand the importance of life insurance for your family, it’s now time to consider the three essential types of coverage in life insurance policies.
1. Critical Illness Coverage
Getting diagnosed with a critical illness (also known as dread disease) like cancer, heart attack, or stroke can turn life upside down.
In Singapore, cancer is the leading cause of death, accounting for 23.9 per cent of recorded deaths in 2022 (Source: TODAY). Furthermore, medical treatments can be very costly – with expenses potentially reaching up to S$600,000 – depending on the type of medical condition, duration of treatment and hospital type.
Having to undergo treatment procedures and potentially letting go of one’s job, could drastically affect your family’s lifestyle. A life insurance plan with critical illness coverage provides much-needed financial support to cover such medical costs, ensuring you can focus on recovery while continuing to provide for your loved ones.
If you are considering whole life insurance, one good option is Income Insurance’s Complete Life Secure. It is the first in Singapore among the whole life insurance plans that allows you to receive extra protection for advanced stage dread disease1,2 (major cancer, heart attack of specified severity and stroke with permanent neurological deficit), even after making an early or intermediate stage dread disease claim, with the Early Critical Secure Rider3.
Moreover, this Early Critical Secure Rider3 is also the first in Singapore to offer a guaranteed option to purchase a specified new term plan covering death and terminal illness after a diagnosis of early, intermediate or advanced stage dread disease, with the Guaranteed Post-Early DD Cover Option4. In these ways, Complete Life Secure and its riders help you navigate unpredictability with complete protection across various life stages and illnesses.
As for term life insurance, consider options like Income Insurance’s Complete Cancer Care and Complete Critical Protect, which provide support throughout your dread disease journey.
2. Coverage for Total and Permanent Disability (TPD)
A serious disability can make it difficult for you to work and earn an income. In fact, the consequences could hit hard – the median duration that Singaporeans could remain in severe disability is 4 years, and about 3 in 10 could remain severely disabled for 10 years or more (Source: CareShield Life).
TPD coverage could act as an income replacement, ensuring your family has the financial means to maintain their lifestyle and meet long-term financial goals. Without TPD coverage, the financial burden of caregiving, medical treatments, and daily expenses will likely fall on your family.
3. Death Coverage
We don’t often like imagining the worst, but planning for it is an act of love and responsibility as the loss of a breadwinner can mean not only emotional grief but also financial insecurity and uncertainty.
Death coverage helps your dependants have the financial means for their essential needs, such as paying off a mortgage or funding your children’s future education.
According to the Life Insurance Association Singapore, it would be good to have 9 to 10 times your annual earnings as basic life cover (although this can differ from person to person).
Explore Other Areas of Coverage
Life insurance even goes beyond the above 3 highlighted coverage areas. Explore the various coverage benefits of our term life and whole life insurance plans that cater to different needs. Speak to an Income Insurance advisor to get personalised advice based on your financial situation and needs.
The Importance of Acting Early
Getting life insurance as early in your life as possible matters. Taking action early could help you secure lower premiums and protect you and your loved ones from the earliest possible moment.
Why Starting Early Makes Sense
Before you purchase life insurance, insurers may assess your age and health condition to determine your policy premium. Just remember: the younger and healthier you are, the lower the premiums for life insurance coverage could be.
If you wait too long, your premiums will go up as you get older, and your coverage may be reduced if you develop health conditions in the future.
Additionally, consider reviewing your life insurance coverage regularly or when you hit milestones in life, such as starting a family. As your financial needs evolve down the road, this ensures your loved ones are protected against unforeseen circumstances.
So, Is Life Insurance Worth It?
Different types of life insurance cater to different needs and life stages, so there is likely a plan that suits your needs and budget. While we cannot predict the future, we can prepare ourselves to face whatever it may bring – this peace of mind which life insurance brings is certainly worth it.
Whether you opt for term life insurance, which provides cost-effective coverage for a specific period, or whole life insurance, which combines long-term protection with savings benefits, there’s a plan to suit your specific needs.
Check out our life insurance plans which you can conveniently select from a filtered dropdown based on benefits that you select. You can also speak to an Income Insurance advisor to get personalised advice based on your financial situation and needs.
1 The total benefits (in relation to any dread disease benefits or equivalent benefits) under all policies, whether issued and paid by us or any other insurer, cannot be more than $3.6 million (including premiums waived due to dread disease but excluding bonuses) (“Dread Disease Per Life Limit”). Please refer to the policy conditions for further details.
2 You can only make a claim under the Advanced Restoration Benefit if you have previously succeeded in claiming the Dread Disease Benefit for an early or intermediate stage dread disease and if your basic policy has not ended. We will only pay for this benefit once and this rider will end. Any amount we pay under Advanced Restoration Benefit will reduce the Dread Disease Per Life Limit. Please refer to the policy conditions for further details.
3 Any payment made for Dread Disease Benefit under this rider will form an accelerated payment, and reduce the sum assured and any bonuses of this rider and its basic policy by the same amount that we pay under this rider. For policies issued by us that include early and/or intermediate dread disease of the same dread disease, we will pay no more than $350,000 for the same dread disease for each insured (no matter how many policies we have issued to cover each insured). Please refer to the policy conditions for further details.
4 Upon diagnosis of the insured with early, intermediate or advanced stage dread disease covered under Dread Disease Benefit, a new term policy covering the insured may be taken up with only death and terminal illness benefits, without us having to assess the insured’s health. Total and permanent disability will not be covered by the new term policy. The new term policy will include a waiting period of 2 years, within which we will not pay any claims. If an event giving rise to a claim occurs during the 2-year waiting period, we will not pay any claim under the new term policy, the new term policy will end and we will refund 100% of the premiums paid for the new term policy. We reserve the right to decide the type of new term policy to be offered and the insured must meet all the conditions to take up this option as listed in the policy conditions. Please refer to the policy conditions for further details.
This article is meant purely for informational purposes and does not constitute an offer, recommendation, solicitation or advice to buy or sell any product(s). It should not be relied upon as financial advice. The precise terms, conditions and exclusions of any Income Insurance products mentioned are specified in their respective policy contracts. Please seek independent financial advice before making any decision.
Investments are subject to investment risks, including the possible loss of the principal amount invested. Before committing to the minimum investment period, you may want to consider how long is your investment expectations or needs and whether you are able to keep up with the premium payment should your financial situation change. Past performance, as well as the prediction, projection or forecast on the economy, securities markets or the economic trends of the markets, are not necessarily indicative of the future or likely performance of the ILP sub-fund. The performance of the ILP sub-fund is not guaranteed, and the value of the units in the ILP sub-fund and the income accruing to the units, if any, may fall or rise. A product summary and product highlights sheet(s) relating to the ILP sub-fund are available and can be obtained from your insurance advisor or online at income.com.sg/funds. A potential investor should read the product summary and product highlights sheet(s) before deciding whether to subscribe for units in the ILP sub-fund.
These policies are protected under the Policy Owners’ Protection Scheme which is administered by the Singapore Deposit Insurance Corporation (SDIC). Coverage for your policy is automatic and no further action is required from you. For more information on the types of benefits that are covered under the scheme as well as the limits of coverage, where applicable, please contact Income Insurance or visit the GIA/LIA or SDIC websites (www.gia.org.sg or www.lia.org.sg or www.sdic.org.sg).
This advertisement has not been reviewed by the Monetary Authority of Singapore.
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