Mortgage Insurance

[spyderbil316]

Hi,

I just took a bank loan of $764,000 and am looking out for a mortgage insurance to cover both myself and my partner (both 31 yo this year and non smoker).

Was looking through some quotes and got two questions

(I) what is the difference between CI and CI waiver? What does it mean?

(II) I was told that I could actually look to get the NS Men Aviva Term Insurance to cover myself instead of a mortgage insurance. Is this recommended? Should I look to get myself covered for CI? I understand that mortgage insurance would cover TPD. How about CI? Is it recommended?

 

[soneat]

Hi,

I just took a bank loan of $764,000 and am looking out for a mortgage insurance to cover both myself and my partner (both 31 yo this year and non smoker).

Was looking through some quotes and got two questions

(I) what is the difference between CI and CI waiver? What does it mean?

(II) I was told that I could actually look to get the NS Men Aviva Term Insurance to cover myself instead of a mortgage insurance. Is this recommended? Should I look to get myself covered for CI? I understand that mortgage insurance would cover TPD. How about CI? Is it recommended?

1. Always refer to the quotation/benefit illustration and policy wordings when in doubt.
"CI" probably means the insured is covered in the event of critical illness.
"CI waiver" probably means the insured's premium is waived in the even of critical illness.

2. It depends on your bank loan. Usually the bank will require you to buy mortgage insurance via banassurance and most of the time the requirement is to cover death and tpd only.

 

[SBC]

Suggest to drop ECI or CI while you are still very young. Normal term for TPD and death coverage is good enough. Get 1mil each. Male at 41.80 per month.

 

[spyderbil316]

Suggest to drop ECI or CI while you are still very young. Normal term for TPD and death coverage is good enough. Get 1mil each. Male at 41.80 per month.

Hi, how did you derive the value of $41.80/ month? Would this be a level or reducing term plan? Would I be able to add on CI or ECI when I grow older as suggested?

 

[Bigoya]

Hi,

I just took a bank loan of $764,000 and am looking out for a mortgage insurance to cover both myself and my partner (both 31 yo this year and non smoker).

Was looking through some quotes and got two questions

(I) what is the difference between CI and CI waiver? What does it mean?

(II) I was told that I could actually look to get the NS Men Aviva Term Insurance to cover myself instead of a mortgage insurance. Is this recommended? Should I look to get myself covered for CI? I understand that mortgage insurance would cover TPD. How about CI? Is it recommended?

Both mortgage insurance and normal Term insurance are meant to cover your income loss due to death/TPD/CI.

ECI usually do not result in loss of income.

How a mortgage insurance differ from a normal Term insurance is that the sum assured gradually decreases to $0 as the home loan is amortized.
By theory, the premiums should be significantly lower than a normal Term insurance for the same starting sum assured since coverage reduce over the years, however from what I've came across, premiums usually don't differ significantly.
If you find one that is cheap, consider taking it up.
Otherwise, it may make better sense to get a normal Term insurance instead to cover your mortgage and also your life too.

(II) The pros about the Aviva GTL is very low premiums for death/tpd coverage. The cons is high premium for CI coverage (optional). Also, premium for death/tpd increases significantly after age 65 and coverage cease at age 70.
Aviva GTL is a normal (level) Term coverage plan.

Suggest to drop ECI or CI while you are still very young

This is generally not recommended.
Firstly, you don't know when the symptoms of CI/ECI would start creeping up. By the time you encounter them, your likelihood of being covered reduces.
Secondly, the money you save now wouldn't justify the extra annual premiums in the future when premium increase with a new attained age.

Note that I'm not discussing whether or not TS should be getting CI or ECI.

 

[spyderbil316]

Thanks Bigoya and all for the advice meted out.

Am grateful for them.

Can I check, when you say cheap, how cheap exactly is cheap? I got quotes for Term with CI at $1000+ and without CI at $500-800 average.

Would it be possible for me to take it without CI for now and then add on CI thereafter?

Both mortgage insurance and normal Term insurance are meant to cover your income loss due to death/TPD/CI.

ECI usually do not result in loss of income.

How a mortgage insurance differ from a normal Term insurance is that the sum assured gradually decreases to $0 as the home loan is amortized.
By theory, the premiums should be significantly lower than a normal Term insurance for the same starting sum assured since coverage reduce over the years, however from what I've came across, premiums usually don't differ significantly.
If you find one that is cheap, consider taking it up.
Otherwise, it may make better sense to get a normal Term insurance instead to cover your mortgage and also your life too.

(II) The pros about the Aviva GTL is very low premiums for death/tpd coverage. The cons is high premium for CI coverage (optional). Also, premium for death/tpd increases significantly after age 65 and coverage cease at age 70.
Aviva GTL is a normal (level) Term coverage plan.



This is generally not recommended.
Firstly, you don't know when the symptoms of CI/ECI would start creeping up. By the time you encounter them, your likelihood of being covered reduces.
Secondly, the money you save now wouldn't justify the extra annual premiums in the future when premium increase with a new attained age.

Note that I'm not discussing whether or not TS should be getting CI or ECI.

 

[spyderbil316]

Just to add on, as a Civil Servant, I'm also eligible for POGIS. Would you recommend POGIS or AVIVA?

Thanks Bigoya and all for the advice meted out.

Am grateful for them.

Can I check, when you say cheap, how cheap exactly is cheap? I got quotes for Term with CI at $1000+ and without CI at $500-800 average.

Would it be possible for me to take it without CI for now and then add on CI thereafter?

 

[Bigoya]

Thanks Bigoya and all for the advice meted out.

Am grateful for them.

Can I check, when you say cheap, how cheap exactly is cheap? I got quotes for Term with CI at $1000+ and without CI at $500-800 average.

Would it be possible for me to take it without CI for now and then add on CI thereafter?

GTL - $500k on death/TPD for $20/mth till age 65.
https://www.aviva.com.sg/life-and-health/for-individuals/mindef/group-term-life.html

Normal term life $500k coverage for death/TPD would cost roughly between $50/mth to $80/mth? Sorry, i don't have the exact quote now.

1 thing to note for GTL is that you cannot do a nomination. Hence if you pass on, only $150k would be paid out 1st and the remaining balance would go through the interestate law's distribution which could take quite some time to process. This might affect your mortgage repayment if your family needs that money.

It is possible to take the plan without CI as CI is an optional rider.
I would suggest you to take up CI coverage with another insurer instead of GTL due to the cost.
But do consider my advice on taking up CI coverage late in my previous reply.

 

[Bigoya]

Just to add on, as a Civil Servant, I'm also eligible for POGIS. Would you recommend POGIS or AVIVA?

This is the 1st time I come across POGIS.
Get back to you after I look through the available details.

But most importantly, before I could provide u with any accurate reccomandations that is suitable for your profile, I'd deffinitly need to access things like your current financial conditions/commitments/liabilities/cashflow and what you expect out of the product's purchase. What i'm giving now are really just general advices.

 

[Bigoya]

This is the 1st time I come across POGIS.
Get back to you after I look through the available details.

But most importantly, before I could provide u with any accurate reccomandations that is suitable for your profile, I'd deffinitly need to access things like your current financial conditions/commitments/liabilities/cashflow and what you expect out of the product's purchase. What i'm giving now are really just general advices.

bro i just read up on POGIS. I realized why this is the 1st time I come across it. Compared to GTL, GTL makes a lot better sense.

Normal term life $500k coverage for death/TPD would cost roughly between $50/mth to $80/mth? Sorry, i don't have the exact quote now.

Just checked my quotes, premium $55/mth for AXA, GTL is half the price.

 

[dendii]

You can drop ECI but dropping CI is definitely not advisable.

First of all it is impossible to predict what can happen to one's health.

Second of all premium will also increase along with age. Sure one can argue but I save all my premium earlier by not taking CI already. But you risk the possibilities of exclusions or the worse case scenario, complete rejection for insurance.

Personally, I will rather be safe than sorry. But to each his own.

Suggest to drop ECI or CI while you are still very young. Normal term for TPD and death coverage is good enough. Get 1mil each. Male at 41.80 per month.

 

[linusz]

Ntuc mortgage doesn't cover terminal illness. It only give ti waiver which is not accepted by cpf for hps.

Agents. Do confirm

 

[fantastic_four]

Hi guys,

I have a question regarding the bank loan for HDB resale. Say, due to pre-existing conditions, one can't get the HPS (or any MRTA from bank), will the bank cancel the loan?

Many thanks!