One last question -- what's your take on CI & when does it make sense to get one?
Your baisc coverage is only 30k per claim. Multiple claim up to total 150k.
CI ("Critical Illness") insurance ranks fairly low as a priority, in my view. Let's consider your particular policy as an example, but they're broadly similar. The basic idea is that if you "win" the illness/ailment lottery, and your illness happens to be on the CI list, then you receive a one-time payout ($30K in this case). Some policies are "two pay" or "multi-pay," meaning they pay more than once. (This one is maximum "5 pay" evidently.) Of course all of these policies cost money, and there are various twists and complications since many of our best and brightest students dedicate their careers to making our financial lives more complicated in order to optimize revenues and profits. Heartwarming, isn't it?
Some CI policies are attached to life insurance, and some are "standalone." The life insurance attached policies can "accelerate" the life insurance payout (meaning they are basically equivalent to death and trigger some or all of the death payout, reducing or eliminating the death payout), and others are added on top of the life insurance.
....OK, with that background, I'll repeat the basic parameters to help you understand when you need insurance (and by implication when you don't). You need particular insurance when ALL of these conditions apply:
(a) You're at risk of a calamity or catastrophe -- a really serious incident, something genuinely grave;
(b) That you cannot reasonably handle on your own using your other assets (including any other insurance payouts);
(c) That a money payout would solve or at least make better.
So, for example, let's assume you could buy "Breakup Insurance," meaning that if your boyfriend or girlfriend stops loving you, leaves you, and finds a new partner, the insurance pays you some money. Breakup Insurance fails condition (c) at least: money cannot buy that person's love. There are some bad things that happen that money cannot solve, and all an insurance company can do is pay money, if it pays money.
As another example, you can buy travel insurance that pays up to $500 when a bus companies loses your suitcase holding your favorite $10 Donald Duck toothbrush. But the loss of your Donald Duck toothbrush isn't a genuine calamity or catastrophe, so it fails condition (a) and probably (b) as well. You simply don't need insurance for the small, non-calamitous risks. (You most probably need travel
medical insurance, highly preferably unlimited, that pays for emergency medical care, medical evacuation, and medical repatriation. Those circumstances are calamitous and tremendously expensive, so that one matters if/when you venture outside Singapore, probably with the exception of a bus ride to Johor Bahru for example since that'll probably work out well enough.)
Now, turning to "Critical Illness." Several years ago I think there was some merit to CI, because it was an imperfect but probably the best available "gap filler" to pay primarily for medical care and secondarily for unpaid time off from work when confronted with a grave illness/ailment. But Singapore has a much better medical system now, we have bigger compulsory medical savings (MediSave), and there's much better hospitalization insurance (Integrated Shield) particularly since 2015 that includes quite a lot of pre-/post-hospitalization coverage for related care. That coverage window varies depending on the Integrated Shield plan you have, and it's a good point of comparison between policies and riders. However, that said, it's prudent to have a basic Integrated Shield plan in place, and that plan should do a rather good job handling the big medical bills.
Disability Income Insurance (DII) does an even better job of handling forced unemployment (and loss of income) due to disability. Let's suppose you're age 28, and your
average future monthly income is $5,000/month until age 65, over 36 1/2 years let's suppose (438 months). I'm assuming some wage increases but also a little time between jobs. That adds up to $2.19 million. CI insurance, if it pays, might pay you $30K? $100K? OK, let's go crazy...$200K? Versus a loss of $2.19 million if you become disabled tomorrow and unable to work. Let's assume current income is $4,000/month and you have DII covering 75% of that ($3,000/month). In this scenario DII will pay at least 432 months (6 month waiting period assumed), and we'll also assume a non-escalating payout (Aviva offers optional escalating), so the insurance company's DII payout is just shy of $1.3 million in this example. Yes, that's less than $2.19 million...but it's a hell of a lot more than even $200K, which just isn't enough to survive on with anything resembling a decent lifestyle.
And remember, CI coverage isn't free. You have to pay premiums for it, and there are some insurance company overheads. If you do a decent job gaining "financial altitude" with saving and prudent investing, you'll solve condition (b). You can (and should) save more when you aren't having to pay premiums. "Cash always works," and it's very flexible. If you need an extra $18,230.32 (precisely) to keep the household running for 8 months while your Integrated Shield and MediSave pay for most/all of your chemotherapy but also while you
feel like taking unpaid time off from work (but aren't able to claim DII since you're
able to work), cash and other liquid assets definitely work -- and you're not getting a $100K CI payout that's too big in the circumstances (and that you had to pay for with premiums) for example.
Anyway, the bottom line is that I think it's OK to skip CI insurance. It's perhaps a "nice to have," but I don't think it qualifies as an insurance necessity nowadays. I broadly agree with
this blogger about prioritization.
But going without coverage.. what are the risks?
... but i'm thinking chemo, cancer meds, & the likes. 