Friday, November 4, 2016

Early Critical Illness Pondering

Among the level of my grandparents and my parents, aunts and uncles (2 and 1 levels above me in my family tree), 40% of them have got cancer and not all of them are over 65 yet.

Basically, based on my horrible genetics, I think that there is a very high chance that I would likely be afflicted with cancer in the future. Of course, health is wealth and I will definitely try to mitigate this risk by exercising often and going for regular health check ups to make sure I detect any illnesses early.

I might not be the fittest, but I am rather proud to say that I have never failed a single IPPT in all my years so far. Sure, I don't get gold, but this passing streak is a pretty good feat considering how sedentary most of our lives get once we start working, especially for people with desk jobs.

While the last medical that most people did was in NS, I've gone for medical check-ups on my own 3 times since then. So far, my tests are all showing that I am fit and healthy, and that's a good thing. I'm scheduling my next medical for December or January 2017. 

However, if tio then is really tio. Although prevention is better than cure, it's good to have contingencies for both.

If (early) CI does strike, as of now I have H&S insurance with NTUC to take care of the hospital bills. With my Assist Rider, I'll only be shelling out a maximum of $3,000 which is my co-payment limit. No stress on my emergency fund at all. 

If the CI detected is one of the standard ones in the LIA definitions, then great, I get to claim to AXA DPI CI rider and my Aviva MHA CI rider for a nice cool $200,000.

If the CI detected is an early one, unfortunately I am only covered by the MHA Early CI rider which may or may not cover the CI that I am afflicted with. Cancer is my biggest concern and it is covered though.

I have been thinking if I should boost my early CI coverage, especially since I am probably one of the few people who actually have better than average odds of claiming due to my genetics.

I have compared the MHA insurance along with a standalone policy by Aviva for Early CI / CI taking myself as an example with coverage only until age 65.

Findings

Aviva covers 51 CI and terms are more encompassing (+)
Total Aviva CI + Early CI premiums until age 65 - $26,573.40 (1.5% more expensive)
Aviva premiums are level throughout (+)
Aviva premiums start out high and paid yearly (-)
Aviva plan for CI and Early CI are mutually exclusive (-)
Aviva plan is standalone (+)

MHA covers 37+10 for 47 CI and some terms are up to insurer (-)
Total MHA CI + Early CI premiums until age 65 - $26,169.60
MHA premiums may be revised, both up (+) or down (-)
MHA premiums start out low and are paid monthly (+)
MHA plan for CI and Early CI are independent of each other (+)
MHA plan is dependent on group partnership with insurer (-)

Conclusion

In terms of cash flow, the MHA insurance actually seems better because of the lower premiums initially (when we are in the start of our lives) and the option to pay monthly without any penalties (good for hitting bank GIRO requirements). However, cashflow to me isn't a problem and this just seems to be an admin and logistical negative, as opposed to a product issue.

Product-wise, the only one-up the MHA insurance has is that it's policies are independent of each other. This means if you claim for an early CI and later discover another CI, you'll get both claims. For the Aviva insurance, after the first claim, you are paid out 100% so your policy collapses.

The Aviva insurance is standalone, which I feel makes it very attractive. It is not contingent on the SAF/MHA partnership with Aviva, and that is one of the main reasons why I am looking for another policy - not because I don't think that the money is enough, but I am worried about their partnership and the implications for people like me if the partnership really dissolves.

The Aviva product also covers more and looks to me to be more lax about the conditions to make claims.

My conclusion is that for pretty much the same price (1.5% price difference), the Aviva product is superior because it is standalone with a wider coverage.

I will let my thoughts bask in my brain for a little while, but it is highly likely that I will be taking up with Aviva plan very soon unless some new information or argument can convince me otherwise.

As always, I welcome any thoughts and comments on this article.

5 comments:

  1. Hi, I also increased my coverage of early CI using Aviva. I am just a little worried about the cessation of coverage at age 65 considering that life expectancy is increasing.

    ReplyDelete
    Replies
    1. Hi Anon,

      After age 65 when one is no longer working and doesn't need insurance to cover income lost, the "cost" of having insurance is high, while it's benefits are muted (purely for the additional recovery costs and NOT for lost income replacement).

      After age 60, the premiums for CI and early CI starts to increase a lot and makes it so that compared to outsourcing your risk to the insurance company, it becomes more sensible to self-insure through liquidation of assets as the years (and premiums) go up.

      Just my opinion.

      Delete
  2. I am also worry of cancer. I have Aviva MyShield, CI plan from NTUC and AIA Women Glow of Life

    ReplyDelete
    Replies
    1. Hi Starlight,

      It seems that you have a good line-up of policies with various insurers, very prudent!

      I like the AIA plan which offers the free health check-up. Have you gone for one yet? I wonder how comprehensive the checks are. But it's definitely a good way to force you to take a good look at your health situation every 2 years!

      Delete
  3. Can meet up for a review and discussion for those interested.

    Just drop me an email at binquan@gmail.com

    Thanks.

    ReplyDelete

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