In choosing an insurance policy, there are quite a number of technicalities for consideration. The following are some of key considerations :
1) Type of insurance
Term, wholelife, health, auto, etc.
2) Renewability
If the insurance policy is not renewable guaranteed, there is a possibility that it may be cancelled in the future.
3) Premium rate guarantee
Some insurance policy may come with guaranteed premium rate. However, due to the higher life assurance cost as one grows older, the premium rate for some term insurances tend to be age-band.
4) Type of Coverage
Death/Crisis cover/TPD/PA
The list goes on and on. For life insurance, I would prefer term insurance to whole life insurance. The reasons have been explained in my earlier posting (Why do we need insurance?). Personally, I feel that life insurance is meant to mitigate the risk of loss of income in the event of death/disability/terminal illness. This protection is especially important when you are the sole breadwinner. With our limited funds, we would like to get the maximum protection value for every dollar spent on the premium. This is what term insurance could offer.
Disclaimer: The content in this blog contains purely my personal opinion and it is in no way a substitute for professional financial advice. You should seek advice from a professional financial advisor with any question regarding your financial matters.
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