Disabilities are caused not only by accidents but by illnesses as well. In fact stroke is the top cause of disability*. More than 60% of stroke survivors remain significantly disabled 3 months after they were afflicted*
Financially speaking, disability can be worse than passing away. It is one of the most devastating threats to a family’s financial security. And it’s a mistake to think that disability only strikes the elderly.
Every year, more than 10,000 people in Singapore suffer a stroke and are admitted to hospital^. And 1 in 10 of all hospital admissions are the result of an accident^. We are all at risk, all the time, and an illness or injury that prevents you from working can start a downward slide that wipes out all of your assets.
No one expects to suffer from a Critical Illness and most people don’t prepare for it. Yet, every day in Singapore, 28 people are diagnosed with Cancer*. Thanks to advancement in medical science, most survive and many recover. However they may then face the financial hardship brought on by medical expenses incurred during the illness, which may not be covered in part or in full by their Medical Expense plan, and any prescription medication that they may need could amount to a lot of money.
You may also wish to seek pioneering or experimental medical treatment. What’s more, the combination of the illness, treatments and medications may often prevent one from being able to work or care for the family, resulting in loss of income and unanticipated expenses such as child care support.
*Source: The Global Cancer Burden – Tbe Straits Times, 4 Feb 2012
Healthcare costs are rising faster than the cost of other goods and services*. Is your Shield Plan keeping up with the times? 72% of Singaporeans agree that they cannot afford to get sick these days due to the high medical costs**. Medical Expenses benefits aim to meet the direct costs of treatment and hospitalisation.
You may consider upgrading your CPF Medishield plan to a private Integrated Shield Plan, which can be paid through your CPF Medisave account**. Compared to CPF Medishield, Integrated Shield Plans provide more comprehensive benefits and coverage.
*From 2006 to February 2010, the Healthcare Consumer Price Index has risen by 15.4%, compared with a rise of 14.6% in the General Consumer Price Index over the same period (Singapore Government Ministry of Health website MAS Monthly Statistical Bulletin January 2011)
** Source: Singapore’s Emigration Conundrum, The Business Times, 6-7 October 2012
***Up to S$800 per person per year or S$1,200 if you are aged 81 or above, based on your attained age next birthday
By Lorna Tan, The Sunday Times, 22 May 2011
Most of us know how traditional life insurance like term and whole life policies work, but what happens if you cannot keep working due to illness or injury?
Traditional life plans provide a cash payout if the policyholder dies. They usually come with a total and permanent disability (TPD) cover that offers protection if calamity strikes.
If the policyholder qualifies to claim under TPD, the lump-sum cash payout will come in handy to defray medical and household expenses, instead of having to wait for death for the death benefit to be paid out.
This is where the confusion arises: What exactly is included under a disability cover?
Traditional TPD cover kicks in when the insured is permanently unable to engage in a job or to perform work of any kind. This could be due to injury or illness.
It also includes total loss of sight in one or both eyes, and the loss of one or both limbs above the wrist or ankle.
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Do you feel lucky? Here are some statistics.
- 1 in 4 men and 1 in 5 women will contract one of the Critical Illnesses before age 65
- you are seven times more likely to suffer from a Critical Illnesses before reaching 65 than you are to die
- Heart diseases, cancer and accidents are 3 of the top 10 conditions for medical costs
- 1 in 9 women will develop breast cancer
- 1 in 2 men at risk of Cancer by 2022
- Every day in Singapore, 28 people are diagnosed with cancer.
Source: Office of National Statistics, and Swiss Reinsurance and Tower Watson
I did mention that paying taxes and Retirement are two guarantees in life. Here’s another – Children’s education.
As a parent, you certainly want the best for your child. And that includes giving your child a bright future with the best university education that you can afford. But did you know your child’s university education can cost over S$500,000 in 20 years time?* For most parents, the escalating cost of higher education may come as a rude shock. While a local university education is projected to cost over S$100,000, a degree course in the USA could cost a staggering S$352,738 by 2025*.
Children are the future of the world, so the greatest present you can give to your children is the best education possible. But unless we plan in advance, we may struggle to give our children the best education they need.
*Source: Estimated Education Cost: 4-year university degree, http://www.aia.com.sg