Insurance viewed as building blocks.
There is no "one truth" when it comes to insurance. Agents will always tell their clients it varies from person to person due to budget, health condition or needs. Which is entirely true! For myself, I like to view insurance as a Lego block pyramid.
A person's insurance portfolio should consist of several areas to cover any unforeseen circumstances. Regardless of one's income, the most important policy to buy is hospitalization plan! Getting sick or hospitalized in Singapore is no joke. There are various plans out there offered by numerous insurers. Since this blog is not used for hawking my services*, here's a link to a neutral party called MOH which lists the various available insurers. Do note that a person can only own one hospitalization plan, so talk to your trusted agent for more details.
If a person has enough budget after buying a hospitalization plan, they should consider something more important like whole-life or term plans which insure against Death, Critical Illness (CI) and Total and Permanent Disability (TPD). Here is the complicated part: there is a myriad of plans which you can purchase. Whole-life (insures you all or most of your life) or term (insures up to a certain age) policies? Add on CI policies to your present whole-life policy? Mix a whole-life plan with term policy? There is some further debate here regarding such plans - for singles, do they really need a death policy if they do not have dependents? for those with dependents, how cover is too much? Again, I urge you to speak with a trusted agent.
As always, do set aside some of your salary for savings or retirement. I know it is hard, even for myself. Still we got to try. One day we will be unable to work and inevitably rely on these squirreled away funds to sustain till death. As for a matter of how much and where to put your money into, this is a very subjective issue. Some prefer bank savings and fixed deposits, some savings plans, while others swear by stocks and property. The savings strategy is different for everybody. For myself, I can share that my own money is placed in limited-pay savings plans and a bit of stocks.
For those few with a bit more budget and can afford some other "minor stuff", you can always look into policies like personal accident plans, home insurance etc. These policies can come in handy. After all, insurance is bought for the sake of "what if" scenarios.
Do note that these views are not professional advice but how I choose to see a person's portfolio should be arranged.
*A reminder again to not contact me for one-to-one services.
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