Secret to buying insurance

Should I buy from a friend or direct?

Try not to buy from an adviser because insurance commissions can be very high. Yes, it can go up to 50% for your entire first year’s premium. This is why you should go online to get one yourself. Simply Google “Compare Insurance” to find out portals that can help you spot the cheapest coverage.

How do I shop for insurance by myself? I don’t even know what is needed?

There are just a few categories of insurance.

• Health insurance mitigates the risk of falling sick – I recommend to upgrade to cover private hospital expenses
• Life insurance – I recommend to cover your projected income until the age of retirement. By retirement you won’t need insurance because your savings is supposed to take over. Frankly, if your family is wealthy enough to survive should you pass on, forget about this.
• Critical illness – I like this. Buy this because you don’t want to be a drag to your family when you are critically sick. Note that both euthanasia and suicide is illegal in Singapore

Buy term insurance. They are cheaper. Do not buy wholelife or ILP. There is, however, a special case for ILP where you can choose to maximise coverage and use the rest of the remaining units to invest (very little).

Honestly, the products that an adviser sells you won’t be able to help you retire well. You need to seek higher income and, perhaps, work harder.