Sunday, October 29, 2006
You really ought to be thinking about private health insurance if:
you’re not covered by group health insurance ;
you’re covered by a National Health System or some other Universal Health System;
you’d like to have the option to have private care where you currently live; or
you’d like to be able to go for treatment for a specific problem to another country
What are the basic features of private health insurance ?
These policies generally offer one or two major levels of coverage:
q A comprehensive coverage, including in-hospital care and services as well as the services of doctors, lab tests, x-rays and other scans, etc. in a non-hospital setting; and
q A basic coverage which is limited to all care and services relating to a inpatient hospital stay only.
The common variables within these policies are various limits on reimbursement within the policy; a choice of deductibles; and any differences or limitations based on where the care is provided.
But beyond this, there are traps waiting for you unless you look carefully at what is offered. So how do you decide what makes a policy right or better for your specific needs? Let’s look at some of the things you should be aware of:
Applying for a Policy
It’s easy to get coverage with one of these policies - just answer a few easy questions and pay your premium. Then, when you submit a claim, that’s when the problems can start ! You may be asked for proof that the problem you just had treated wasn’t a pre-existing condition at the time you applied for the policy.
What’s a Pre-existing condition?
Generally it means a medical condition, which is currently being (or was previously) treated and any condition associated with it. Just for clarification:
¨ ‘Treated ’ means:
1. Doctor’s visits, tests, taking medication, or even a special diet for that condition within the past one year, two years, five years, or anytime in the past (each policy has its own time frame); and:
2. A condition which a ‘prudent person’ would have had treated, even if you didn’t - or, in some policies, even if you didn't know about it but they feel you should have!
¨ ‘Any condition associated with it’: means a medical problem that they deem to be an outgrowth or result of the original pre-existing condition. For example, a broken leg could be deemed to be the result of brittle bones caused by cancer treatments!
If the insurer decides it is a pre-existing condition, they may deny the claim. Always remember, the larger the claim the more carefully they’re going to examine it! Not what you want to go through when you have just incurred a claim for $10,000!
These policies ask very detailed health questions on the application form and may even ask for doctors’ reports. Based on all the information they get, the insurance company may decide to:
1. accept you with no exclusions or conditions;
2. accept you with an increase the premium;3. accept you with an exclusion for a specific medical condition; or4. reject you.
It always makes good sense to disclose pre-existing conditions on your application form even if the application doesn't ask about them; then the insurance company will find it harder to deny a claim for a pre-existing condition if they didn’t exclude it when they approved your application.
Some insurers automatically reduce benefits, charge extra premiums, or even discontinue your coverage when you reach a specific age; for example: at 60, 65, or 70, the maximum annual limit under the policy drops from $1 million to $100,000 or they may add 25% extra to the premium.
Policy exclusions to be aware of:
Some policies exclude travel if it’s specifically to get medical care. Others exclude care if you travel ‘against the advice of a physician’ or ‘while you are on a waiting list for treatment’; in that case, treatment for that specific condition may not be covered while you’re travelling.
Ø Pregnancy and Childbirth
Some policies exclude pregnancy and childbirth completely while others exclude them only for the first 12 months of the policy. Even if the pregnancy and birth are covered, some policies automatically exclude the first 15 days of a newborn’s life - while others cover only the first 14 days of life. In these cases, the baby must then apply as a ‘separate person’. Because many policies exclude birth defects, and congenital and hereditary illnesses, that baby may be refused coverage. Such policies may not be appropriate if you’re in the childbearing years - take a long, hard look and ask questions before you sign up for such a policy.
Ø Chronic illnesses
Some policies specifically exclude or limit the coverage of conditions which are or become chronic after you purchase the policy. An asthma attack (acute) may be covered but not ongoing asthma problems (chronic).
Ø Limited Coverage
Some policies limit coverage for any single accident or illness to, for example, the first 12 months of treatment following the onset of that accident or illness.
Ø Organ transplants
Some policies exclude such procedures; some offer it as an additional benefit, and some include it as a part of the regular coverage.
Ø Where you are
Some policies place no limitations on where you can go for care while others limit the region of the world where they will cover you (and may charge different premiums based on the region(s) you select).
Ø Home Country
Some policies limit the time you can spend in your ‘Home Country’ or even exclude it completely. For example, travel to/in the U.S. may be limited to 30 or 60 days for U.S. citizens or anyone born there regardless of their current citizenship. This could apply even if you go for a short visit and then, because of an illness or accident, need to stay longer. The policy may be cancelled or suspended when you reach that maximum time limit, regardless of your health condition at the time.
Getting Claims Paid
Many policies now require you to get prior approval for a planned hospitalization, with a penalty of reduced benefits if you don’t. They may be more lenient with emergencies but still require notification as soon as possible after the emergency. Some may also limit the choice of hospitals or doctors you can use. Even if you don’t need pre-approval, informing an insurer before a hospitalization is a good idea since they can usually pay the hospital directly for your stay.
Ø Non-hospital bills
In most cases, you must pay physicians, labs, etc. yourself and then submit those bills with proof of payment.
Ø Submitting Claims
Some policies require a completed claim form - others, just the original bill. In almost all cases, you should get the bill in English or supply an English translation - it tends to smooth the path to reimbursement.
Ø Emergency Help
Almost all policies offer the services of an International Help Centre, 24 hours a day, seven days a week. The Centre can refer you to an English-speaking doctor and/or hospital and/or assist in the event of an emergency requiring medical evacuation. This is obviously more useful when you’re in a non English-speaking area, but you can use it wherever you are in the world.
Ø Medical Evacuation
This is a useful feature if you’re in a country/region with a healthcare system which is below par. But, be aware that no policy offers evacuation just because you would prefer it. If the emergency can’t be treated locally, you will be evacuated to the nearest major facility capable of providing a decent standard of care. The definition of ‘nearest’ and ‘decent’ are decided jointly by the Emergency Help Center and the insurance company.
Premiums are normally payable for each person in a family, although some policies do offer a family premium. Others offer ‘free’ coverage to pre-teen dependent children if one parent is covered. Premiums may vary based on where you live or where you want to have treatment, and may increase with attained age. Payment is usually by cheque or credit card and may offer a choice of currencies for premiums and reimbursements.
Guaranteed renewability of an insurance policy is fundamental to the selection of that policy. If there is no guarantee to renew coverage regardless of your health condition at the renewal date, beware! Cancellation of coverage is not what you need if you have developed a medical condition which would be deemed pre-existing if you have to apply for another policy.
Take financial care of your survivors, once you’re no longer there to do it; and to take the burden of worrying about the financial aspects of your death off their shoulders;
Pay off any outstanding debts - a mortgage, other loans, credit card balances, etc;
Provide money in the event you are diagnosed with a dread disease or terminal illnesssome policies will advance you part or all of the death benefit so that you can fill in for lost income, get the special treatment you want, spend quality time with your family, etc;
Pay estate taxes and other settlement costs - wherever they have to be paid;
Provide educational funds for your children or grandchildren;
Supplement your retirement income - life insurance can often accumulate tax-sheltered
funds within the policy;
Charitable donations - life insurance can be used to make a donation to your favourite charity
What types of Life Insurance are there?
There are 3 basic types of personal life insurance:
This can be likened to renting an apartment. It builds no equity within the policy. If you stop paying premiums, the coverage ends. And just like the rental lease on an apartment, the premiums can increase after the initial term of the policy ends. But, in the short term it offers the highest amount of coverage for the lowest cost.
This is like buying a house. The upfront costs and annual premiums are usually higher than term insurance, but those premiums are generally fixed throughout the term of the policy. Most whole life policies offer a build-up of equity within the policy with significant tax advantages in that build-up
This is a flexible combination of Term and Whole Life. It has many of the features and minimal premiums of a term policy, and yet offers flexibility to increase those premium payments and accumulate equity using some of the features and advantages of a whole life policy.
When should I buy life insurance?
A question for which there’s no exact answer! At a minimum, most people would like to leave enough money to provide for the cost of their funeral. Aside from that, many people feel they don't need life insurance unless and until they have surviving dependants, debts or other liabilities to be paid off, or other needs to provide funds after their death.
As one’s lifestyle changes and evolves, the need for life insurance also changes. Each lifestyle change brings a potential need for more or less life insurance, and therefore, ideally, the coverage should be reviewed at every such point of change. Most financial consultants recommend a regular and frequent review of life insurance as part of overall assets and liabilities.
How much should I buy?
Again, there may not be an exact answer! If there’s a specific amount is needed at your death - to pay off a mortgage or other debt, to donate a defined lump sum to a charity, to fund college fees, etc. - then the amount of life insurance you need may be quite easy to calculate.
If the question is how much your survivors may need to live on after your death, it becomes a harder question to answer. Some factors which affect this calculation are: the age and number of survivors; where they’ll live and the lifestyle they’ll need to support; the rest of the estate you‘ll leave them; and various other points you need to consider.
Where should I buy it?
Until recently, you could only buy life insurance in your current residence or in any other country where you had an active connection, for example: employment or a residence from which you actively conduct ‘lifestyle’ activities (such as holding a drivers license, doing banking, and making credit card purchases). That’s a legalistic way of saying that you could normally buy life insurance only where you live now or in your Home Country if you maintained a residence there, traveled there often enough to be medically-examined there, and could provide financial references and other underwriting requirements there, if necessary.
For expats of the US, Canada, and the UK, this was significant since premium rates for life insurance in those countries have dropped quite dramatically compared to the rest of the world, due in part to advances in life expectancy and the liberalization of various statutory requirements for life insurance companies.
Has that changed?
In the past few years, with the advances in communications and purchasing insurance over the web, international life insurance has become an easily-available commodity. Now an applicant, regardless of his citizenship or residence, can purchase life insurance from a variety of sources and still handle the underwriting requirements.
These international policies offer many advantages, including benefits and premiums payable in US dollars or other stable currencies; medical (and other) exams conducted where you live; payment of death benefits wherever you or your beneficiary(ies) designate; and payment of premiums by wire transfer, cheque or credit card.
So what should I be looking out for now?
These advantages are somewhat offset by the risks of buying international life insurance.
In the US, Canada, and the UK, there are regulatory authorities that exercise a supervisory role over the activities of the insurance companies within their jurisdiction. There are also rating agencies which provide ratings of insurance companies. In the international arena, there are many reputable and world-renown insurance companies and there are also many small companies operating on the fringes of the insurance world.
You need to be aware of the ownership and financial standing of any insurance company that makes a proposal to you. On the other hand, you shouldn't have to pay inflated premium rates because of an insurance company’s pedigree! There are international insurance companies which offer premiums and policies based on US policy designs, US mortality rates, and US premium tables, and which are owned and guaranteed by major US insurance companies.
So, what’s the bottom line?
In summary - life insurance is for the living, not the dead! By and large, you don't need it - your survivors do. Those who depend on you or will be left with a burden when you die are the ones who might need the life insurance on your life. And, ideally, it should be a part of an overall financial plan which takes into account all of your other assets and liabilities. Remember it’s you who has to make the final decision to buy it - while you can.
Tuesday, August 29, 2006
One thing i have to thank the Singapore government is the creation of the CPF and medisave. The system forces us to save first then spend.
Back to medisave, how are the funds accumulated?
In Singapore, as long as you work in a corporate job, you and your employer will contribute 33% of your pay to your CPF account. Out of this 33%, depending on your age, around 6% will go to your Medisave(age 35 and below).
If you earn about $2500 a month, that's about 150 bucks going into the medisave. A year that will amount to $1800. It will earn interest about 4%. Not bad.
What can this money be used?
Medisave was introduced in 1984 to help Singaporeans pay for their hospitalization expenses. Over the last two decades, it has helped Singaporeans build up significant savings for their healthcare costs, especially in old age when medical expenses are expected to increase.
As Medisave is designed primarily to help lower-income Singaporeans pay for their Class B2 and C hospitalizations, the various Medisave claim limits have been pegged to Class B2/C rates. This has served us well for many years. Today, more than 90% of Class B2/C bills can be fully covered by the Medisave withdrawal limits.
But do take note, Medisave is a savings program. This means it is exhaustive. It means it will run out. The current ceiling is $32,500. Minor illness it should be enough. But for major and long term illness.... I cant say it is enough.
how much can be drawn? Click here.
Monday, August 28, 2006
seriously think about it. With all the advances in medical science and technology, all those once sure die illness can be cured, removed physically or chemically.
We live longer and longer. The lifespan of the male and female population is about 77.9(male) and 81.6(female).info obtain from the Ministry of Health website.
That means i am living longer and longer, that's good right? That means i can enjoy more time with my loved ones. Of Course that can only happen when i am absolutely healthy and no illness so as to say. But what are the chances of that? Be frank to yourself. With all the alcohol, cigarettes, rich food, rising temperature and stressful work culture, it is very hard to maintain a healthy lifestyle and body. Hard but not impossible. Many people are working on that now, yet many people simply do not bother until it is too late.
Some People say we have medisave, medishield and medifund. Lets look into these various resourse and evaluate whether it is all we need...
Saturday, August 26, 2006
More jobs: Stats on 166 titles
How MONEY picked the best jobs
Rank Career(click for CNNMoney.com snapshot)
Job growth(10-yr forecast)
Average pay(salary and bonus)
1 Software engineer
2 College professor
3 Financial advisor
4 Human resources manager
5 Physician assistant
6 Market research analyst
7 Computer/IT analyst
8 Real estate appraiser
11 Advertising manager
12 Physical therapist
13 Technical writer
15 Medical scientist
16 Physical scientist
18 Curriculum developer
20 Public relations specialist
21 Sales manager
23 Property manager
26 Social service manager
28 Health services manager
29 Advertising sales agent
31 Management analyst
32 Occupational therapist
33 Mental health counselor
34 Landscape architect
35 Biotechnology research scientist
36 Urban planner
38 Speech-language pathologist
39 Meeting and convention planner
41 Biological scientist
42 Financial analyst
45 Environmental scientist
46 Lab technologist
47 Registered nurse
48 Sales engineer
50 School Administrator
You just strike 4D. With all your savings and the prize money, you got 1 million dollars. You think you are ready to retire by the age of 55 next year.
But heh reality check.
Your son, Charles, will be going to the states to study an engineering degree in 2 years time. The cost of this 4 year programme will amount to about $200,000. Your mum is 76 and enjoying the golden years. Your Dad is 80 and has cancer. His expected cost of treatment is $100,000. That is $300,000 to be deducted from your retirement checque. Then, there is $400,000 tied up in your new condo. Your million-dollar retirement now looks a lot less attractive.
This story may not reflect your situation completely, but the underlying facts are real.Singapore like many countries in the world suffer the problem of an aging population. Lets face it, due to the circumstances most people are marrying later, and consequently, by the time we near our retirement, our children may still be financially dependent on us, as will be our parents.
But let us not allow such grim facts get us down. There are ways to get around our various commitments, a proper financial planning and prudent investing is the way.
What is a proper financial planning? Pls stay in touch.
Friday, August 25, 2006
Who doesn't want to be rich?
But let's face it, getting rich hard and fast if one or more of the following conditions applies:
- You're not an investment banker or venture capitalist.
- You're trying too hard to live like one.
- You started a family and had the cutest darned kids.
- Like me, you persist in living in one of the highest-cost, highest-taxed places in the world.
Being financially independent, however, isn't out of the question. And once you achieve that, you've laid the groundwork for living well.
In fact, there's no point thinking about rich until you have a sound financial plan.
A sound financial plan doesn't have anything (or at least not much) to do with how much you make or the savings you have. Any financial planner will tell you they've had high-income clients who, given free rein, spend themselves into the ground.
Broadly speaking, a sound financial plan means being able to meet your financial obligations. How solidly your PLAN is, you'll be depends on how you define "meeting your financial obligations." You may be able to pay the minimum on your credit card bill, but being able to pay off the whole balance every month reduces your financial risk.
For long-term financial plan, though, you'll need more than just enough to pay your bills today. You'll need protections in place to keep you and your savings saved when a costly crisis hits.
To make sure you're the only thing fleet-of-foot in your life, here are four ways to lay a solid financial foundation.
Build a cushion
For life's pricey annoyances, there isn't MasterCard. There is an emergency fund.
It's a hassle to build if you don't have one, but you'll be glad you did next time your transmission sputters or you got retrench.
I recommend setting up a high-yielding bank account dedicated exclusively to Emergency Money. An Emergency Fund should be around 6 months of your most recent drawn pay.
To fund it, besides curbing spending where you can, you might deposit:
- A bonus or financial gift from a relative.
- A small amount from your paycheck every month.
- Money you get back from a flexible spending account, a transportation reimbursement account or an insurance claim.
- Your Bonus. I am sure your company have year end bonus. That ranges from 1-3 months of your month pay. If your fixed monthly expenses don't change, you might be able to set aside one paycheck a year.
And please if it is not an emergency, do not use it! This fund is not for year end overseas trip and your other expensive dreams.Once you complete accumulating your Emergency Fund, then you can start to set up your other funds.
Live on less than you make
Set at least 10 percent of your gross income for retirement savings which can be invested to gain potential high Returns.
Then live on 90 percent of your take-home pay and bank the rest for shorter-term savings goals like a down payment or vacation.
If you can be discipline enough (it will be hard to do - I know, I live in Singapore), don't let your debts (including mortgage or rent, credit card bills, loan payments, etc.) exceed 36 percent of your gross income, less if possible.
Adopt a pay-go, pay-off strategy
With a few exceptions, don't charge more than you can afford to pay off in full every month. Ideally, the only debt you should carry from month to month should be mortgage debt and student loan debt, the interest on which may be deducted on your tax return and which represent investments that can pay off later (your home and your education).
For new homeowners who can't afford to pay outright to furnish their first place, I suggests asking the furniture store if there is a 0-percent interest policy for one year. Then be sure to pay off the entire amount charged before the year is out. Otherwise, you'll get hit with deferred interest.
Pay off high-interest credit card debt as soon as possible, diverting some of the money set for savings if need be to do it. It makes little sense to pay 15-plus percent interest on credit card debt when you're only earning between 4 percent and 8 percent on your savings.
A health crisis can be a fast lane to debt if you don't have health insurance. But so, too, can long periods of disability unless you have disability insurance.
At a minimum, you want to have short-term disability benefits covering 100 percent of your gross pay for three months, and at least 60 percent to 70 percent of your pay for longer term disability.
If you're the main breadwinner in your family, i would suggests bumping up your long-term disability payments as close to 100 percent of your pay as possible. And do take note Insurers aren't likely to offer policies that cover the full 100 percent, but having something is always better than having nothing at all.
As for life insurance, if you're the main breadwinner and have young kids, you might consider getting a term life policy which is less expensive than whole life -- worth 7 to 10 times your annual salary, or whatever your calculate your kids will need to get them through college and what your surviving spouse will need until then and thereafter.
I will cover more on the types of insurance later.hope you find this first post of mine Informative.