Choose the right insurance policy for your family
Why do you need insurance?
As the family's main income earner, have you ever thought what might happen if you got sick, or had an accident? Would your family face money problems? Can you prevent such problems? Yes, insurance can protect your family's wellbeing, but coverage and cost vary. So, what insurance should you buy to take care of your family, which is also cost-effective?
The right policy
First, you should consider the situation of each family member, including age, health and work. The following types of insurance may be suitable:
- Medical insurance
- Accident insurance
- Home insurance
- Life insurance
- Critical illness insurance
- Savings insurance
- Car insurance
- Travel insurance
Are you covered?
- Level of insurance
How much you are insured depends on the premium, which is the amount you pay to the insurer. The higher the premium, the more coverage and benefits. To work out how much you can afford on monthly or annual premiums, estimate your family's finances. Then, choose the type of insurance you actually need. For example, if you are a newly married couple, you might choose basic life insurance, and increase the level of coverage when you can afford more. If you are looking after your partner, kids and parents, insurance that protects your income loss from hospitalisation should come first, followed by medical insurance for your parents.
- Family needs
Health and life insurance are usually the most important, then home, property and savings insurance. For example:
- Dependants, such as parents - life and medical insurance take priority.
- Children - medical insurance is essential, plus savings insurance for their education fund.
- Middle-aged - a retirement plan is important, so savings insurance is too.
- Managing risk
Insurance is all about risk management, so you should choose an insurance plan that suits your risk level. For example, if you or your family have health problems or a critical illness, you should take out insurance to cover this. If the building you live in is old or there is little security, home insurance is a good idea.
The smart approach
- Understand clearly the insurance you and your family need to avoid buying policies that are too expensive or don't suit you.
- Reduce risk by exercising, stopping smoking and leading a healthier lifestyle, which can reduce premiums.
- Compare companies to find the most suitable insurance plan.
- Pay the premium on time to ensure you are always covered.
- Regularly speak with your insurance agent to review your insurance plan.
- Carefully read the insurance policy so you are clear on what is covered and what is not.