What insurance should I buy for my children?

And a baby completes the family! Now that you're considering insurance planning to protect your newborn, where do we start?

Let's find out the top 3 plans that your family should be protected with.

When you become a parent, your responsibilities increase. You need to make sure that you're ready to take of your family emotionally, physically and financially.

With a newborn in tow, needless to say, you probably have a never ending to do list. But while you attend to the "here and now" needs of your new and growing family, make sure that you don't lose sight of the bigger picture.

A crucial responsibility as a new parent is to plan the financial preparedness and protection for your little one’s future. An aspect of this is to make sure that you realign your family insurance plans to financially protect yourself and your family.

However, are you a little overwhelmed with the options available and a little clueless about where to start? In this article, we highlight three priority areas which you can begin to evaluate when it comes to insurance for your family. 

#1:  Always protect yourself first

Do you remember those safety videos that are aired before a plane takes off? Think about the scene when the parent puts on the hanging oxygen mask on herself before attending to the child.

The same theory can be applied when it comes to insurance.

Mr Daniel Lum, Director of Product Marketing at Singlife, explains, "Your children are completely dependent on you for all their needs. If you're no longer able to financially provide for them, they are helpless. It makes sense for you to protect yourself first, before tending to their insurance needs, so that there is a financial safety net for your children, in case something happens to you."

One of the ways to financially protect your family against situations like death, critical illness, terminal illness and/or disability is via term insurance plans. Such plans typically pay out a lump sum of your choosing should the unfortunate happen, your family can continue to pay the bills, mortgage, children's school fees and other living expenses.

#2: Health insurance

While parents tend to have health cover for themselves, they often overlook taking on health insurance for their children until there is a medical emergency.

It is, however, prudent to purchase health insurance coverage early on, according to Mr Lum.

"If a medical condition has already developed, insurers typically will not cover that condition and other related conditions. This is why parents should get health insurance for their children when they are young, healthy and free from illnesses, to secure full coverage," he said.

In Singapore, all citizens and Permanent Residents are covered by Medishield Life. This national medical insurance provides basic coverage on hospitalisation and surgical costs, which protects your baby for life, even if they have pre-existing health conditions.

To enhance the coverage, you can purchase Integrated Shield Plans such as Singlife Shield. Integrated Shield Plans are designed to provide "as charged" coverage for most benefits so you need not be restricted by MediShield Life's claim limits. It also provides increased coverage so your child can be treated at higher class wards or private hospitals, and still be covered for the higher costs. And while MediShield Life does not cover pre- and post- hospitalisation treatments, an Integrated Shield Plan will.

What’s more, if both you and your spouse are covered under Singlife Shield Plan 1 or 2, your children will enjoy discounted premiums till age 20! In Singapore, it is the only Integrated Shield Plan that gives free health coverage to children, so you get to enjoy cost savings while your family enjoys comprehensive healthcare protection with a peace of mind.

You can pay for your child's Integrated Shield Plan premiums via your or your spouse's Medisave – good news for new parents who may be cash strapped! 

#3: Lifelong investment for your child's future

Knowledge is power and the best investment for your child is in education.

However, the rising costs of education cause parents to worry if they can afford their children's tertiary education in 10 to 20 years' time, so the third thing you should focus on is purchasing a savings plan for your child's education.

"Because of the power of compound interest, the earlier you start, the more time there is for your savings and investments to grow," Mr Lum shared.

There is a variety of different savings and investment options available, depending on your preferences and affordability. Endowment savings plans purchased from an insurer or bank is one of the most common way in which parents save for their child's education.

Mr Lum further elaborated, "One benefit of purchasing a savings plan from an insurer is the ability to add on protection riders for greater assurance. For example, with Singlife's savings plans, you can typically add on a cancer premium waiver – in the event that you're diagnosed with a major cancer, Singlife will contribute any remaining premiums on your behalf, so your child's education fund isn't impacted and will continue to grow." 

Celebrate your new chapter in life, and enjoy the fulfilling journey of parenthood. While there may be sleepless nights and tantrums abound, the best security option is to ensure that financial planning for the family is well taken care of during unforeseen circumstances. With adequate planning and coverage, your children's future will have a smoother path ahead.

Updated on: June 2017

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