Legacy FA Pte. Ltd.
Legacy FA Pte. Ltd is a financial advisory firm licensed by the Monetary Authority of Singapore under the Financial Advisers Act (Cap. 110). Legacy FA is independently owned and not tied to any product provider and is able to provide unbiased services geared towards your interests. As everyone is different, we listen first to your needs and customise our solutions to help you in your financial planning and wealth goals.
Our services cover the following areas:
You’ve bought your home and it is your biggest asset. However, the housing loan you took also makes your home your biggest liability.
2 issues arise when trying to buy the insurance to cover your mortgage liability.
The insurance payout is triggered on the death of the life assured. If both you and your spouse work and your respective CPFs and salaries are needed for the home loan repayment, the cover should reflect this.
The insurance payout is triggered on the life assured being assessed to be totally and permanently disabled. The payment for TPD is subject to limits and whatever does not get paid out under TPD is paid out on death, if within the policy cover date.
I have seen many policies taken out for mortgage that did not cover for critical illness. From my 25 years of doing claims, I know that this is a mistake. Many lose their homes because the breadwinner contracts a critical illness and income is disrupted.
Multiple claim critical illness cover - This is new and consequently, expensive. The cover typically
covers limited claim for early critical illness, a higher limit for advanced stage critical illness and
multiple claims across several illness categories over the cover period.
One can claim for early stage cancer and should a relapse occur some years later, make another claim. Premiums per $100,000 of cover is typically 7-8 time more expensive than normal critical illness and 1.5 times more expensive than early critical illness cover.
Early critical illness cover - This is also relatively new and relatively expensive. It pays on diagnosis of a range of early, intermediate or advanced stage critical illnesses. Price per $100,000 is typically 5x that of Critical illness cover
Major Critical illness cover - pays on diagnosis of major critical illness.
There is no cookie cutter solution for critical illness cover. Take some time to discuss with your
The type and quantum of cover suitable for you should take into account, factors such as family history, how often you do comprehensive medical screenings, health and lifestyle and budgets.
Traditionally, people have bought Decreasing Term for their housing loans. The cover or sum assured decreases steadily over the lifetime of the plan to roughly cover your loan balance as the loan is progressively repaid. Should a claim occur, the insurance proceeds should be enough to pay off the outstanding loan.
The level term plan, as the name suggests, maintains a level sum assured throughout the cover period. On death or total permanent disability, the sum assured would be sufficient to pay off the loan and leave a cash balance for the family. This was less popular among buyers, presumably because it is perceived to be more expensive.
In recent years, fierce competition among insurers for market share have focussed on the level term. This has resulted in 2 market anomalies Level term prices have fallen at a far more aggressive rate than decreasing term. It seems in the price war among insurers, the decreasing term somehow got ignored. So today, if you compare the decreasing term with a level term, the level term may seem more cost effective.
With aggressive price decreases in level term over the past 4-5 years, term prices are really very cheap. Indeed, old term plans should be reviewed for costs savings, assuming you are still in good health. We have seen savings of between 20- 40% even though the client is older. No point continuing with a policy that was bought before the several rounds of level term price wars when you can now get the equivalent cover at a cheaper rate or a higher more comprehensive cover at the same price.
Buying comprehensive mortgage insurance protection for your home is like buying a life vest. You never hope to use it. However, should the boat sink, it must work!
Insurance people can be annoying, they stick to you like chewing gum and they bug you to buy
bundled products. Or they build up a pitch for you
Many people ended up buying too much overlapping insurance coverage that they do not need and worse still, some can only claim from only one insurer. Many people ended up with coverage that cost them much more premium than necessary, because they were attracted by some glitzy road show and nice posh lounges with neat looking insurance people. Many people bought insurance linked policies that has heavy loading on the investment returns. Many people have a portfolio that has too high management fees due to too many layers, this eats into their returns.
Legacy FA can help you to review your entire insurance coverage to potentially reduce your premium cost while providing you the same or similar coverage. Legacy FA can assist you to review your portfolio to cut out unnecessary costs to further enhance your returns.
Subscribe to our weekly Newsletter and stay tuned.
(Anti-spam promise: We only send emails when there is something interesting and meaningful.)