Should You Buy Insurance?

 I finally cash out one of my child insurance policy after paying annual premium for 25 years. The amount gain is about 3.1% p.a. And since I have many insurance, it makes me think hard and plan when to cash them out as the years roll by.

 

If you are a young working adult, changes are that you would have been approached by an insurance agent. It happened to me many times. I usually don’t like to buy insurance as the benefit kick in only when you are met with an emergency like a life threatening disease or even death. Even without any mishap, you need to continue paying premiums for at least 20 years to see some gain in your “investment”. And these gain are just mere 2 to 3% p.a. Insurance policies are not investment or saving per se. So, it is best to know about what insurance policies are about and do some research. There are many type of insurances – Health, Life, Child, Housing, Accident, Endowment, …. You can read more in this blog:

Insurance

The only insurance that is needed to buy is for health protection. Accident, diseases, chronic illnesses are unpredictable and can strike any time. The cost of medical treatment is very high. Health insurance will helps to lessen the financial burden. For Singaporeans, we all have the MediShield Life Insurance as mandated by the government. The premium will keep increasing every year. I am now paying more than $2000 per year, even though this insurance only entitle me for a Class C or B treatment at government hospitals. To opt for better coverage, I will have to buy more health insurance. So, the best way is to always stay healthy, eat with proper diet and exercises regularly. Till now, I have not make any insurance claim and hopefully, will never need to do so.

These policies that I have bought are mainly from relatives, buying in support for them. Painful as it may be to pay a lot of premiums every year for the past 20+ years, it is a relief that I can get some money back. Entering into retirement, I see these insurances as a life line for my basic needs. However, to keep these insurance policies, I still need to pay for their yearly/monthly premiums. This is something that eats into my finances, so I need to do some careful planning on the timing to cash out the insurances. The government Central Provident Funds will only give me money in 3 years’ time, when I reach 65 years old.

What are your views about insurances?

Have you any health insurances?  Premiums will go up as you get older, so it is better to start early.

 

Agape