Buying insurance for Children

During my time as first-time parent, we are blur blur general direction in investment and protection.  That was in the last 90s then.

We bought whole life insurance (dont know and dont care about ilp or tradition); at that time, no one talked much about Term insurance.  No such things as TermLife.

And... my monthly pay was less than $2,000.

And CPF did not allow topup to child SA.  I remembered that this was introduced in 2013 under a "Others" category.  

I quickly made my first $10k topup to their CPF SA, each to my child; over n over the next decade.  At that time, one kid had yet even had her nric; hence I wouldn't check if the cheque topup into the CPF SA was really deposited.   Very chuang.

Do make your own decision, I am no insurance agent.

If I were you, I would do this:

Pt1: Your child has to be covered under both parents' Company Dependents Health Benefits.  First basic protection from Day 1 till their age 21.  (Caveat: Buy when no medical loading. Touchwood.  This clause stays valid)

Once both have no Company health benefit for them, quickly cover them for:

H&S, Critical Illness TermLife, if possible; Mindef-Aviva GTL cheapest in town for now.

Pt 2: Because of early age mortality charges, One year old or 15-year old, their (any) insurance premiums will not defer much.  In other words, you can delay your insurance buy for them.

Caveat: If you want to buy

a. buy those Wholelife which is Limited Pay for 20-year; After 20-year, no more premiums to maintain the policy.

b. keep rider ("the frills") as minimal as possible as they don't add to cash value.  [This is one of the reasons many puke at wholelife policy; they pay for so much rider premiums and later realise that its cash value sucks].

c. buy into ilp policy.  You can cash out in future without surrendering the policy.  Non-ilp or tradition policy does not have cash value to withdraw, unless you surrender the policy.

(but a & c, may be contradictory; insurer dependent)

Pt 3: With such T-bill and FD high 4% interest rate climate, invest in it "for them".  As long as interest rate is ~4%, continue; don't think of insurance till their ~age 15. 

Pt 4: I would topup $$ into their CPF SA till $200k/FRS. MA $20k.  MA to help pay their future CareshieldLife and Medishieldlife premiums.

Pt 5: At age 16~21: Start to buy insurance; don't buy into single insurer, as their T&C esp. for CI may differ; also to diverse against insurance company collapsed.

-CI TermLife (usually it comes along with Death & TPD). (minimum $1M for very long runway planning.).   Some CIs has Cash Value even if it is TermLife CI.

-H&S (with As-charged rider)

Pt 6: You are their best protectors.  Keep fit and Stay healthy.  Watch your health.

Pt 7:  Once you embark any insurance for them, dont look back and regret.  It is a form of leveraged for their bequest; and a way to cash out and surrender $$ if future needed.

Wholelife insurance or even Term is a Love-Hate topic.   When one needs it and is insurance naked, one will regret.

Pt 8:  Go find out more on Leveraged insurance policy.

Hope this help.  I no insurance agent hoh.