Life Insurance


Why do you need this?

For financial protection or coverage

A life insurance policy pays out an agreed amount known as the sum assured under certain circumstances. This will be paid to you if you are permanently disabled or critically ill, if your policy provides for this, or paid to your estate if you are no longer around. This money is intended to help you meet your financial needs and / or those of your dependants if these events happen. Life insurance provides financial protection or coverage against these risks.

The life insurance policy contract is between you and a life insurance company. In return for this protection or coverage, you pay a premium for an agreed period of time, depending on the type of policy you purchase.

For retirement planning, savings or investments

Life insurance policies are often marketed to meet retirement planning, savings and investment purposes too. For example, an annuity can provide an income during your retirement years.

Life insurance products like whole life and endowment participating policies or investment linked plans (ILPs) bundle together a savings and investment element with insurance protection. Hence, for the same level of insurance cover, the premiums will cost more than for a pure insurance product like term insurance.

Bundled products tend to build up cash values over time. These are paid out when the policy matures or is surrendered. Death benefits that include cash values are paid out upon the death of the insured. Term insurance does not build up cash values.

Bundled products are often marketed as savings products because a part of your premiums is invested to build up cash values. But unlike savings deposits where you generally expect to get back the amount you saved, the guaranteed cash values of an insurance product may be less than the total premiums paid. While part of your premiums will pay for insurance protection while the rest is invested and subject to investment risk.

If your aim is to protect your family’s well-being, make sure the product you buy meets your protection needs first. You should consider term insurance if all you want is life insurance coverage.

Read here for things to watch out for when buying life insurance.

compareFIRST

After you have assessed your goals and needs, your next step will be to choose life insurance products that are able to meet your specific requirements. Given the myriad of life insurance products being offered by different insurers, the task of finding a suitable life insurance product can be daunting. To help you to decide on which life insurance product to purchase, you can visit compareFIRST.

compareFIRST is an interactive online portal that allows you to easily compare the premiums and features of life insurance products. You can customise your search by indicating your preferences such as the coverage amount, premium payment period and whether you would like to include critical illness riders. Thereafter, a list of relevant life insurance products will be generated and you can then compare the estimated premiums and features of the products generated.

Your decision to purchase an insurance product should not be based solely on the amount of premiums chargeable. Make an informed decision by considering the benefits, features and coverage of the life insurance product(s) that you are interested in.

Use compareFIRST and start comparing life insurance products today.

 

The above information is prepared in collaboration with the Life Insurance Association Singapore.