Critical Illness Insurance in Singapore: What is it, Who Offers it, and How to Choose the Right One for You!
What is Critical Illness Insurance?
Critical illness insurance is an idea that was borrowed from term life insurance. However, the major difference is that the benefits are paid out only once a policyholder is diagnosed with a specific set of illnesses. In that case, critical illness insurance does need a person to die before payouts are made. However, since death is not a requirement for fund disbursement, critical illness insurance in Singapore is also informally referred to as a living benefit.
Just like term life insurance, CI insurance is paid out in a lump sum. The main condition is that you need to have been diagnosed with one of the critical illnesses agreed upon when signing up for the policy. When signing up, the policyholder and the insurance company agree on a fixed lump sum amount. Diagnosed patients can spend the money however they want, but most people opt to use it for additional treatment or spend memorable moments with their families. The funds come in handy when other existing policies do not cover specialized treatments needed for specific illnesses.
A simple critical illness insurance policy will cover less than five conditions, but some of the biggest insurance companies in Singapore list up to 50. Furthermore, the conditions available for coverage generally vary between carriers and their policy types.
Some examples of conditions you can find in a critical illness policy include:
- Severe burns
- Heart attacks
- Major organ failures that need transplants
- Alzheimer’s disease
- Aplastic anemia
- Bacterial meningitis
- Multiple sclerosis
- Parkinson’s disease
Choosing the right plans
Due to competition, companies try to outdo each other by providing unique critical illness insurance plans. So even if your future medical conditions are not that predictable, it is wise to explore as many options as possible before signing a contract. Begin by getting scores of quotes from the biggest insurance companies in Singapore. The comparisons will also give shoppers a deeper understanding of covered illnesses, how much an average cover costs, and the benefits. Only then can a buyer make the right choices according to their needs and financial muscle.
Getting critical illness insurance in Singapore
You do not need to go to each insurance company to get quotes physically. Insurance companies and agents have very detailed CI insurance SG information available online. These can be compared side to side, rated, and downloaded. Furthermore, these websites have professionals who offer guidance that will give you more points to consider, just in case you overlook something essential. Remember to compare the terms of each insurance quote, even if they charge the same premium. For example, some will cover your children too while other companies will not. Such significant differences can make or break a deal because your spouse and dependents are a vital part of your compensation lump sum.
To avoid getting scammed, thoroughly crosscheck if the websites you are dealing with are linked to registered companies. Some tell signs of a scam company include the lack of contact channels for further queries, ambiguous or scanty information about the plans’ limits, and unclear claim procedures. In addition, such companies have awful ratings on websites that conduct critical illness insurance SG reviews.
Consider critical illness covers if:
- You have a family that heavily depends on your monthly income.
- You have a steady income but do not have a good savings nest egg to sustain you in disability.
- If you are not on any employee benefits that will sustain you for an extended period out of work.
Rare instances when you may not need critical illness covers:
- Whenever you have more than enough savings to cover ongoing expenses like rent and mortgage payments for a long time.
- If you do not have any financial commitments like mortgage payments or a family.
- If your spouse is financially well off and can finance any living costs.
- If your employer already provides a hefty compensation scheme if you cannot work.
Key benefits of critical insurance
Some key benefits that should make you drift towards a certain insurance provider when buying critical insurance covers include the following:
Paid expenses: When you suffer from a critical illness condition, you are likely to endure a long recovery process. The cover should be sufficient to cover your unexpected expenses and still sort out any medical bills directly connected to them.
Guaranteed renewability: Your coverage is guaranteed as long as your premium is paid on time.
Lump-sum benefits: With critical illness insurance, the payments are only made in lump sums. Clients can claim the compensation as long as any of the conditions listed are experienced. In other words, there is no condition in the coverage list that can be treated as minor or deserving less compensation. The money is used at the discretion of the beneficiary.
Benefits are paid directly to the insured: Clients have direct control over how their benefits are used. Unlike other medical insurance types, the insured spends the money as he wishes. Furthermore, it does not act as a top-up for the medical bills that their existing insurance pays.
Increased flexibility in coverage: A policyholder can request that their policy coverage be paid up in 20 years or have all the accrued premiums paid back after 15 years. That gives the insured more flexibility as their financial position changes.
Having the right critical illness insurance SG plan ensures that you have a solid cover to shield you whenever a severe yet unexpected disease hits you. It may be brushed off as a luxury or an expensive plan, but the opportunity cost of not having it is tremendous. Consider having a cover that will take care of you and your family if you are diagnosed with a severe illness that may likely force you to leave the workforce. With the correct comparisons and the proper purchasing steps followed, you can get a fair deal.