Story 1:
A 30 years old engineering with a foreign spouse and a daughter living cordially and happily in HDB flat in Singapore. He is earning a decent income and his wife is not earning anything.
When I saw him and his family , I open him up to understand the importance on protecting his money because he is a sole bread winner. However, I also take into consideration that his disposable cash isn't a lot. The solution is as simple as using his CPF medisave to purchase a Enhance integrated shield plan on hospitalisation and probably a term insurance to give him temporary cover on death , disability and critical illnesses cover.
His decision then is to take on integrated shield plan but no willing to take on the term insurance proposal.
On Mar 2020, he suffered from cancer . His total medical bill come up to SGD$470k . His integrated shield managed to pay a large portion of his bill and the rest fork out using his medisave account. He is grateful that the medical bill are being transferred to insurers instead of his family .
Unfortunately , he is no longer healthy enough to earn an income . He need to fall back on his foreign wife to take on 2 jobs to make ends meet. I still remember vividly that he regretted no willing to part with less than $100 per month to take on the term proposal I proposed.
Lesson learnt here : Medical insurance alone is not a sufficient good plan to secure your financial mishap that may happen.
Story 2:
I have a client who are very well verse in planning and you can be assured that he has everything you need in terms of insurance to protect himself and family. As probability would have hit , he suffered stroke and end up consider a medically and mentally disabled.
Since he is very well protected by insurance , his family should not worry about money to take care of him. However, as fate would have played on his life , insurance proceeds were indeed paid out into his named bank account , but his family members are not able to make any withdrawal for him.
This is because , he is still alive and Will and nomination cannot be activated to distribute his assets yet. He is alive and therefore insurance proceeds are being deposited into his account but he is not mentally able to make decisions to use the assets. They are inside a very grey zone .
His family has to apply for one person to be his Care taker in order to assist him in his well being and also his finances.
This problem can easily solved using Lasting power of attorney when a person is mentally able to make decision for himself.
Lesson learn : Wealth distribution is as important as any other planning process. If wealth distribution is not done well enough, there could be loop holes that your assets cannot be used effectively .
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