Case Study on How Insurance Would Have Helped Unfortunate Man
I read in the papers about a very unfortunate case about a man who accidentally slipped and fell on a walkway wet from rainy weather, causing him to be paralysed from the neck down.
He is now suing the town council for negligence and seeking compensation for medical expenses, loss of earnings, transport costs as well as pain and suffering.
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Not so Obvious Reasons to Start Planning Sooner Rather Than Later
There are quite a few obvious and oft-repeated reasons why people should start financial planning now: insurance premiums increase when one decides to get it at an older age; health problems may set in making it more difficult to get insurance coverage; investing early allows one to enjoy the full magnitude of the compounding effect amongst other reasons.
These are actually rather minor concerns to me.
What is the absolute difference in premiums when one is 25 versus when one is 26, 27 or even 28? It is not very much actually. Delaying one’s investing by some time also do not make very significant difference. Of course, horror stories about bad things happening to even young people can be an effective way of getting people to sign on the dotted line, but to me, I think a few other factors are more pertinent.
Perceived Cost vs Actual Price of Insurance
IM$avvy carried an article from The Business Times – What turns off Gen X and Gen Y on life insurance – which talks about the reasons why few Singaporeans aged between 20 to 40 wish to purchase insurance.
As stated by the article, a survey found out that most people are put off by insurance because of the high price tag they perceive insurance to carry.
Being Well Insured Means Little if Your Family Isn’t
It’s rare to meet a well-insured Singaporean (given that statistics have shown that the average citizen is severely under-insured), and by extension even more difficult to find a family that is well insured.
For the few well-insured ones: Being well insured alone does not insure against potential financial ruin if financially dependent family members are not insured properly.
In a typical family, all it takes is one uninsured (or under-insured) person and a single unfortunate incident to put the entire family’s finances underwater. Yet, it is common for a family’s decision-makers to overlook or decidedly ignore insurance coverage for the entire family, if they even decide on getting insurance at all.