Confessions: Family Insurance Strategy (2025)

Previously, I shared a strategy for family insurance planning. The overall approach remains unchanged, but there have been some adjustments after reviewing the policies and new family member joining.

🪖 Cancelling Accident Insurance

After having outpatient medical coverage through the company group insurance, accident insurance for the child became rather redundant, so it was temporarily cancelled.

With comprehensive hospitalization insurance for the parents accident insurance was just an extra layer of protection. In recent years, my parents (LTVP holders) have found life here in Singapore a bit dull and often travel around different regions in China. The previous accident insurance required the insured to reside here for more than half the year each year, but last year they didn’t stay that long, so I simply cancelled the policy.

🍼 Adding Basic Insurance for the newborn

Just like his older brother, only two were purchased: hospitalization and critical illness term insurance.

My FA told me that whole life insurance with a critical illness rider for children is the most cost-effective, which is also the choice for most people. In terms of lifetime coverage, the cost is indeed lower. However, I really don’t like whole life insurance and see no need to buy it for children who have no death benefit responsibility. As for the lifelong protection and legacy value of whole life insurance, it’s like how I don’t agree with topping up CPF for children: planning too far ahead doesn’t make much sense. Money needs a certain degree of flexibility to realize its value.

🏥 Changing IP Hospitalization Insurance

According to the MOH’s official comparison, INCOME’s private hospitalization insurance was relatively cheap, so at the time I didn’t think much and bought INCOME’s private main plan plus the highest-level rider for both my husband and kid. However, this comparison didn’t include the rider price. When reviewing the family policies, I realized that after the most recent price adjustment, my husband’s hospitalization insurance rider already costs over 1k, more than twice as mine (we are the same age, mine is GE second tiered rider for private IP). After a careful comparison, I found that INCOME’s rider is quite expensive, and the main plan plus rider is actually not cheap!

Recently, after claiming reimbursement for non-CDL cancer treatment drugs, I realized that keeping the rider is important. Considering the affordability of premiums, it becomes difficult to continue affording top-tier hospitalization insurance as we age. Another consideration is that we tend to prefer public hospitals and only want to retain the option of private medical resources when necessary.

So, the strategy for optimizing hospitalization insurance is: first consider lowering the rider level, then consider lowering the main plan level while keeping the rider. For us now, a private main plan with a rider that covers the deductible for public hospitals is more reasonable.

Under this configuration, AIA and GE’s terms better meet our needs, with GE offering better value. However, based on my recent experiences with GE’s insurance agents and customer service, I’ve been quite disappointed with their claims process. My FA also told me that, based on her claims experience, AIA is indeed the smoothest. In the end, I bought AIA’s hospitalization insurance for my second younger and switched my husband’s hospitalization insurance to AIA as well. My older son and I have pre-existing conditions, so it’s not easy for us to switch.

👷🏼‍♀️ Adding Company Group Insurance

The benefit of reviewing company group insurance together with personal insurance is that you don’t overly rely on company insurance, meanwhile you also make reasonable use of it.

The company coverage is quite comprehensive: one is very useful outpatient and hospitalization insurance that covers family members. This helps supplement the hospitalization insurance deductible and outpatient accident coverage, which is also one of the reasons I downgraded the rider and cancelled the child’s accident insurance.

Another is the three key protections that are crucial for me: life, critical illness, and accident insurance. I have always agreed with buying term insurance as needed, which can be flexibly cancelled: when active work income is high, higher life and critical illness coverage is needed; as I gradually shift to relying on passive income, the need for income replacement coverage (such as life and critical illness) can be gradually reduced. Company insurance fits this logic perfectly, with term coverage decreasing with age: active work → 60 → 65 → 70 → 85.

🏚️ Adding General Insurance

Home insurance and maid insurance were added after moving and hiring a helper, and are also considered part of the family’s insurance expenses.

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