Insurance is your life’s  GOALKEEPER, i.e. your last line of defence . If all else fails, you will need to count on your insurance to be there, especially for financial woes. 
 In fact, we frequently get this question asked and answered by our friendly Seedly community on our  platform : 
 
 “What are the key insurance policies that I really need?” 
 
 
 Let’s dive into what insurance policies we really need. 
 
 TL;DR: Types of Insurance in Singapore You Should Get 
 
 Click to Teleport 
 
 Why Insurance is Important 
 What Insurance Do I Need? 
 No Longer “Ownself Check Ownself” 
 What Type of Insurance Will Protect Me From What? A Simple Insurance Checklist To Go Through 
 Insurance Coverage Guide: Which Are The Most Important Types Of Insurance To Get? 
 Frequently Asked Questions About Insurance 
 Concluding Thoughts 
 
 
 Why Insurance is Important 
 Basically, it protects you from  three Worst Case Scenarios : 
 
 You  pass away prematurely,  and your dependents (e.g. family, kids) inherit your debts and loans while losing a source of income 
 You come down with a  terminal illness,  e.g. cancer (most common) and get hospitalised often while having to foot the bill for expensive treatment sessions 
 You  get into an accident and   survive  but face expensive hospital bills and follow-up treatment. 
 
 What Insurance Do I Need? 
 A lot of people believe that insurance is a  pain in the ass . 
 I believe that is a case of misselling and over-selling by insurance agents because, more often than not, they’re just motivated to close the sale. 
 Of course, there are some agents and advisors who genuinely do a good job and have your interest at heart. 
 In any case, getting insurance should be as simple as just  getting sufficient coverage for the right reasons at the lowest cost . 
 Pictured above: the ideal type of insurance 
 No Longer “Ownself Check Ownself” 
 When you enter the working world, your friends in financial planning or advisory sectors will most likely approach you for coffee. 
 I urge you to go ahead and take this opportunity to  learn from them.  HOWEVER,  do not buy immediately , especially if you need more time to understand the product.  
 Read up beforehand or after and have your doubts clarified despite their recommendations. 
 So how can you do this? 
 Simple. 
 Just use this guide, and feel free to even show this to your insurance agent as a checklist of sorts to make sure that your interests are taken care of. 
 Note: We do not get any commissions from any of these recommendations hence  this would probably be one of the most unbiased guides in Singapore. 
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 What Type of Insurance Will Protect Me From What? A Simple Insurance Checklist To Go Through 
 
 How Do You Use The Checklist? Insurance Benefits, Insurance Policies and Insurance Plans Explained 
 
 Look at what kind of insurance you need or already have based on the checklist 
 Review your insurance policies either by calling up your agent for a review or researching on Google first 
 Look for these two key essential types of policies: 
 
 a  Health Policy  (hospitalisation & surgical, private hospital cover), and 
 a  Life Policy  (is it term or life?) 
 
 
 Everything else is a bonus to have based on your respective situation or circumstance (t he policy names may be fancy but the type of policy is usually the same) 
 
 Disclaimer: The Information provided by Seedly does not constitute an offer or solicitation to buy or sell any insurance product(s). It does not take into account the specific objectives or particular needs of any person. We strongly advise you to seek advice from a licensed insurance professional before purchasing any insurance products and/or services. 
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 Insurance Coverage Guide: Which Are The Most Important Types Of Insurance To Get? 
 If you’re wondering whether the checklist is accurate, I conducted a poll with the Seedly Community to find out which are the  most important types of insurance  to get: 
 
 From the 200+ votes that the poll gathered, more than 185 voted for  health (hospitalisation and surgery) , followed by more than 80 for  term life , followed by other options like  critical illness, personal accident and disability . 
 Side note: I highly recommend checking out the Seedly community’s  comments , as there are pretty interesting insights as to why these are the top options. 
 And if you want more information, longtime fans of Seedly will also know that  Christopher Tan spoke at Seedly Personal Finance Festival 2021  about what type of insurance we really need: 
 
 If you’re wondering who he is… 
 Christopher Tan is a Certified Financial Planner who has  more than two decades of experience in the wealth management and financial planning industry.   
 More Insurance Questions Asked By Most Singaporeans 
 Also, here are some insurance-related questions that are commonly asked: 
 
 What are the differences between each insurance type? 
 Should I mix investment and insurance? 
 I bought an ILP from an agent, should I surrender it? 
 Should I get an agent or Do-It-Yourself (DIY)? 
 How do I choose a good financial planning agent? 
 Should I buy all from one agency or pick and choose from various? 
 Is my CPF insurance coverage already enough? 
 
 Still Confused? 
 If you still have more questions after reading all of these, please feel free to ask our Seedly community of personal finance enthusiasts, financial planners, and experts. 
 The best part?  You can ask anonymously . So jump in now! 
 Ask Your Question on Our Seedly Community! 
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 Frequently Asked Questions About Insurance 
 Here are some of the more commonly asked questions about insurance that we will answer. 
 1) Differences Between The Various Types Of Insurance 
 Rank 1: Health insurance (ESSENTIAL) 
 
 What:  This covers the really expensive Hospital and surgical bills and outpatient care; usually, this is an enhancement to  Medishield Life , which is a government basic health plan for public hospitals up to B2 ward/service.  
 Recommended Benchmark:  At least public A or Private if you can afford it. The reason because I have personally seen the differences in treatment between both private and public hospitals, and it’s quite a world of difference. 
 Why it’s important:  MOST IMPORTANT.  This is the one that usually causes the most damage financially. Because you are neither dead nor 100% healthy. It can be very painful to survive using your own cash or have less than the best care for you. One cancer chemotherapy session costs around $5,000 to $6,000, and surgery can be anywhere between $15,000 to $40,000 for a private quality standard. If you want to learn more about this, you can read  my personal story here . 
 As one of our Seedly readers has pointed out, this insurance covers pre and post-hospitalisation charges. Lab, diagnostic and investigative tests are covered before the confirmation of a major disease. 
For example, expensive PET scans and biopsy tests are claimable before one is diagnosed, say, with cancer. 
 
 Rank 2: Life insurance (ESSENTIAL): Premiums in Insurance 
 
 Term Life:  This is a purely coverage-focused product, where all your monthly/yearly premiums go into coverage, so at the end of the term (usually 65 years old), you are no longer covered. This also means there is no cash component and is what most savvy people recommend because they know how to use the excess cash saved to invest for better returns 
 Whole Life:  This is a mix of coverage product with a savings component tied to it. There is a cash value associated with your policy 
 Investment-Linked Product (ILP):  This is a variant of the life policy where they mix the investment component into coverage. Often with a long lock-in period before seeing returns 
 What:  In case of death, your family gets paid the total sum assured  
 Recommended Benchmark:  5X your yearly income OR your existing liabilities (this is one of many benchmarks available to the public)  
 Why it’s important:  Should increase when you have dependents or more liabilities (e.g. loan, kids) 
 
 Rank 3: Critical Illness (RIDER) 
 
 What:  Usually designed as a rider (a fancy word for a top-up on your life policy), You get paid out a sum assured for a  list of 37 critical illnesses  when discovered by doctors 
 Recommended Benchmark:  Varies from policies, and the payout is tied to life insurance 
 Why it’s important:  Good to have because the likelihood of cancer is 1 in 3 people. You can opt for also the early critical illness, where you get paid out for earlier discovery to seek treatment (e.g. stage 1 & 2) 
 
 Rank 4: Disability (RIDER) 
 
 What:  A monthly payout for income loss if unable to work 
 Recommended Benchmark:  >$3,000/month payout to match your salary 
 Why it’s important:  Crucial if you are the sole breadwinner or entrepreneur, and when you go down, at least there is a constant stream of income coming in for day-to-day expenses 
 
 Rank 5: Personal accident (GOOD ADD-ON)  
 
 What:  Cover outpatient accidental medical expenses 
 Recommended Benchmark:  Payout based on accident expenses (e.g. MRI, CT scan where you are not serious enough to get warded) 
 Why it’s important:  Generally, at quite an affordable price, you feel assured that if you sprain your leg or break an arm playing sports or activities, you can claim for the expenses (Also, food poisoning, insect bites etc.) Also, check with your company, they should usually have a group cover plan for such personal accident insurance. 
 
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 2) Should I Mix Investment And Insurance? 
 A question which normally follows: My agent is selling me an Investment-Linked Product, is he/she trying to milk me? 
 I would think that he/she thinks you are lazy (and do not have time nor interest to make your own investments). 
 There is a saying that you would rather focus on a better tool for each purpose rather than a jack-of-all-trades. 
 By mixing both together, you are buying one product for multiple purposes (investing and insurance ), which may lead to a ton of middlemen: which in turn, drives up management fees, costs etc. 
 By keeping the investment component separate, here are the major positives: 
 
 You are in control of your own finances (knowing what is happening etc.) 
 You pay way fewer fees to more middlemen transacting the deals (management fees and costs) 
 You have more flexibility to withdraw or reallocate the funds with way fewer fees (low or no lock-in) 
 
 However, that being said, the path to learning to self-invest requires a lot more patience in learning, hard work and also risk appetite, which most people may not be entirely committed to. So it’s really up to you if you are willing to commit the  time and effort  to do this. 
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 3) I Bought An ILP From An Agent, Should I Surrender It?  
 
 You can read  21 different answers and perspectives on surrendering your ILP or endowment  and things to consider. 
 
 What was your intention when getting the policy? Is the policy still on its way to helping you meet that objective? 
 Can you invest at a lower cost? 
 Are you able to invest on your own and fetch a higher return? 
 Are you well-covered, or do you have plans to get insurance coverage after cancelling your ILP? 
 Does it make sense to carry on with the ILP in terms of cost and functionality? 
 
 ” In short, if you are disciplined and know enough to do better financially and in terms of coverage, go ahead and cancel that policy! If not, stick to it.” 
 A definition:  In ILPs, premiums are used to pay for units in investment-linked sub-fund(s) of your choice. Some of the units you bought are then sold to pay for insurance and other charges, while the rest remain invested. 
 
 Very often, ILPs incur not only costs but it becomes rather tricky at a later stage in life. You can head over to  this post here in our Community , where some users discussed the realities of the rising cost of insurance in the ILP eating up the investment value at a later stage. 
 Also, you can refer to this  user’s blog  where he/she labelled it NEVER EVER BUY AN ILP. In summary, he/she only had a return of 0.35%, which is way below inflation at 5.1% in October.  
 One of our community contributors, Alan, discussed the interesting trend of underinsuring. This is because they mix insurance with investment (aka whole life), endowments and ILPs. These investment products give mediocre insurance coverage. 
 Hence, some agents may jump on this on this to sell policies which may be without sufficient coverage. 
 
 Fun fact:  ILPs became popular in the 2000s when the term insurance was not sexy enough. Agencies hence rebranded it to include investment components with coverage… there you go. ILP! Its intention was to target lazy people who didn’t want to look at growing their own money in their own ways (but most likely, if you are reading this, you should already be quite savvy, so kudos to you.) 
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 4) Should I Get An Agent Or Do-It-Yourself (DIY)? 
 This is entirely up to you and which you are more comfortable with. 
 
 The same analogy follows: 
 
 Pharmacy: If you already know what you want (e.g. buying Panadol or flu medicine), you don’t pay consultation fees 
 Doctor Clinic: If you have some complicated existing plans or complications, go to the doctor and pay consultation fees on top of the medicine cost 
 
 If you are ‘sick’, you would go to a doctor you know or recommended by someone close. 
 Use this article as a benchmark, there are also some interesting concepts like MoneyOwl (ex DIY Insurance) and the government’s CompareFirst, which helps buy what you need. 
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 5) How Do I Choose A Good Financial Planning Agent?  
 I would first recommend sticking to referrals from friends or family who you know have been on the scene for a long time. 
 Alternatively, you can look for agents with a wealth of knowledge and who are open to sharing. 
 Some of these agents contribute to  Seedly , so you can also use the platform as an opportunity to ask your questions and get answers from them!  
 Not to mention that our savvy community members are on hand to help too. 
 Pro Tip:  be wary of MRT roadshows where they shove power banks into your hand and tell you it’s free, it’s usually bait to rush you into a purchase when you actually need time to understand and figure out if the product is really what you need. Naturally, this DOESN’T apply to ALL roadshows, so exercise your discretion and common sense! If something sounds too good to be true, always ask questions to clarify! 
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 6) Should I Buy All From One Agency Or Pick And Choose From Various? 
 
 Agencies usually focus on and specialise in different policy verticals. Hence, it may or may not be the best price point for various types of policies. 
 
 However, if you get the ESSENTIAL (e.g. a whole life or term life with Agency X), your RIDER (e.g. Critical Illness or Health) may be cheaper as a top-up versus individually purchasing the different plans from different agencies.  
 Lastly, there is a big plus if you stick to one agency – Your Agent (point of contact). That being said; personally, my family has seen a ton of agents leave the industry just after 5-10 years (innately, these people are very driven to succeed, so being an agent it may not be a long-term career path). 
 What happens next is that you get assigned another agent who may not do follow-up meetings and reviews as you have fallen off the ‘sales funnel’ in some sense. 
 
 Disclaimer:  There are, of course, many agents who stay on the scene for a long time. Kudos to them on that!  
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 7) Is My CPF Insurance Coverage Already Enough? 
 Introducing the  DPS (Dependent Protection Scheme)  and  MediShield Life . 
 To be extremely clear on this, these 2 auto opt-in CPF policies act as insurance protection for you: 
 
 Dependant Protection Scheme:  The Dependants’ Protection Scheme (DPS) is term insurance that provides insured members and their families with some money to get through the first few years should the insured members pass away or suffer from Terminal Illness or Total Permanent Disability.​ It covers only a $46,000 sum assured but for a very low premium amount yearly, between $36 to $260. 
 MediShield Life:  It is a basic health insurance plan administered by the Central Provident Fund (CPF) Board, which helps to pay for large hospital bills and selected costly outpatient treatments, such as dialysis and chemotherapy for cancer. It is structured so that patients pay less MediSave/cash for large hospital bills. 
 ElderShield : ​ElderShield is a severe disability insurance scheme that provides basic financial protection to those who cannot do simple daily activities and need long-term care, especially in their old age.​ (you must not be able to do some of the basic routines, e.g. walking, bathing, eating etc.) 
 CareShield Life : ElderShield has been succeeded by  CareShield Life and supplements . 
 
 This one below is slightly different, it acts as forced savings (via CPF) for only healthcare usage: 
 
 MediSave:  It is a national medical savings scheme which helps CPF members put aside part of their income into their MediSave Accounts to meet their future personal or approved dependant’s hospitalisation, day surgery and certain outpatient expenses. 
 
 This is a sum of money (which you are forced to save every month) which you can use when you are warded in public or private hospitals 
 
 
 
 The question of whether it is enough, it would depend on your expectations and personal situation. 
 I would say; personally, I do not think that it is enough. Hence, I’m sharing my own insurance coverage: 
 
 Health : Upgraded to Private Hospital level (NTUC INCOME, bought at a young age) with as-charged rider 
 Term + Whole Life:  Coverage up to $500,000 presently (AVIVA MINDEF Scheme) with a whole life (bought at a young age) 
 Critical Illness and Early CI:  Riders on top of the AVIVA MINDEF Scheme 
 Personal Accident:  Currently, with my company policy 
 
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 Concluding Thoughts 
 The next time your friends (in the financial advice and planning industries) ask you out for coffee, just show them the table and use it as a guide for your discussion. 
 If he or she starts asking you to look at investment components to mix into coverage, you should ask for the reasons behind that recommendation. 
 In fact, if you are reading this now, it shows that you are already considering a  DIY approach when it comes to managing your own money . 
 It’s really not that hard, given today’s technology and accessibility of platforms that allow you to invest on your own with just a few clicks. 
 Starting with ETFs , for example. 
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