
Meant to provide a peace of mind, insurance acts as a safety blanket in the event of a mishap. But what if you are not as well covered as you think you are? With the insurance landscape vastly different from how it was in the past, are you still getting optimal coverage from your policies? In this article, we highlight 3 possible scenarios that may occur should you fail to regularly review your insurance portfolio.
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#1 Your coverage is outdated
When was the last time you reviewed your insurance portfolio? If you have never reviewed your policies before, then chances are your coverage is now outdated.
Take for example a coverage of $100,000. While this might have been adequate for your protection gap in 1999, the same amount is unlikely to suffice in 2019. This is because while your expenses are increasing at an annual inflation rate of 2.57%, your coverage remains stagnant as per 20 years ago.1
Total liabilities |
Coverage obtained |
Total shortfall |
|
20 years ago in 1999 |
$500,000 |
$500,000 |
$0 |
2019 |
$809,760* |
$500,000 |
$309,760 |
*After accounting for inflation at 2.57% per annum.
Note: Coverage used are an estimate and may differ between individuals.
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Help me determine my protection needs
#2 Your protection needs have changed
Different life stages would require varying coverage levels. As such, your protection needs 20 years ago are likely to differ from your current protection needs.

To ensure that you properly address your protection needs, it is imperative that you review your coverage levels whenever you enter a different life stage. This allows you to adjust your coverage as necessary, thus preventing you from being over or under insured.
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#3 Insurance has evolved over the last 20 years
Do you remember the days of 8 to 9 per cent interest rates from your bank savings account?2 Just like how things have drastically changed since then, the same goes for insurance.
An example would be critical illness (CI) coverage. While CI coverage used to be an acceleration of pay-outs from your life insurance, CI coverage now means otherwise. With the option for early CI and cancer coverage, CI plans now allows the insured to receive more comprehensive coverage and additional pay-outs in the event of a diagnosis.
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Available Products on FSMOne Insurance |
Term Life, Whole Life, Critical Illness, Annuity, Health, Endowment from Etiqa Insurance, Manulife, NTUC Income and Tokio Marine Life Insurance *Please check with our advisory team if the product you want is available on FSMOne Insurance |
1Source: https://tradingeconomics.com/singapore/inflation-cpi
2Source: https://www.singaporememory.sg/contentfiles/SMB-34decfc7-23b8-48b0-a267-eb6ef080c1ee/1024513
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