Buying insurance for the first time? Here are some essentials to consider

Insurance plays a vital role in safeguarding against unforeseen circumstances and rising healthcare costs. Understanding the types of insurance coverage, one should have can be overwhelming for beginners. In this article, we will explore the essential insurance plans that beginners should have to ensure comprehensive protection.

· Health insurance:

Health insurance is a fundamental coverage that every individual should have access to. In Singapore, citizens and permanent residents are covered by the MediShield Life scheme, which provides basic health insurance that helps to pay for large hospital bills and selected outpatient treatments. However, it is advisable to consider enhancing your MediShield Life coverage with a MediSave-approved private Integrated Shield Plan to access private healthcare facilities. Health insurance safeguards against rising medical costs and makes sure you have access to quality medical care when needed.

· Integrated shield plan (ISP):

An Integrated Shield Plan merges the benefits of MediShield Life with additional coverage from private insurance providers. It provides access to private hospitals, shorter waiting times and more options of medical services. Having an Integrated Shield Plan can ensure that you have comprehensive coverage for hospitalisation and medical treatments. For beginners with starter salaries, this is a great advantage as you can gain access to more medical treatments without the stress of needing to dip into your savings to pay for treatment.

· Life insurance:

Life insurance is important, especially for those with dependents who rely on their income. It provides financial protection in the event of the untimely death of the policyholder. For beginners, term life insurance is a cost-effective option that offers coverage for a specific period of time ranging from 10 to 30 years. The payout from a life insurance policy can help replace lost income, cover the debt, and provide for the family financially. This ensures financial stability during such challenging times.

· Critical illness insurance:

Critical illness insurance is an important addition to any beginner’s insurance portfolio. It provides financial protection in the event of a serious illness diagnosis, such as cancer, stroke, heart disease, etc. At the time of diagnosis, a lump sum payout is provided to the policyholder that can be used to cover medical expenses, treatment costs and other daily living expenses. Critical illness insurance makes sure that you can focus on recovery without the added stress of financial burden.

· Personal accident insurance:

Personal accident insurance is designed to provide coverage in the event of injury or disability occurring due to an accident. It provides financial support for medical expenses, rehabilitation costs and income replacement during the time of recovery. Personal accident insurance is particularly important for those who engage in high-risk activities or those who have occupations that expose them to higher accident risks. It provides a safety net and makes sure you are not burdened with financial stress during this period.

Insurance is an important aspect of a beginner’s financial plan. While the specific insurance needs may vary depending on individual circumstances, the crucial coverage options should be considered. By securing these insurance policies, you can protect your financial future and have peace of mind.