You’ve read each word on the labels, and then the online reviews but, half an hour later, you’re still standing in the supermarket aisle with the same two boxes in your hands. Choosing between whole life and term life insurance can often feel that way.

With this many conflicting takes on the matter, it’s hard to decide which type of plan can better serve your priorities. Here, we offer a case for term life insurance from the perspective of your long-term financial planning and life goals. Find out why short-term protection can make all the difference in your distant future.

What your friends may tell you

Raise the topic of life insurance, and the conversation can take an easy turn to a comparison of coverage. It often seems like the longer your life protection the better, and that whole life insurance is the way to go for those who seek affordable means to accumulate cash value.

Meanwhile, term life insurance looks more like an expense than an asset, since you pay premiums for only a fixed number of years of protection – which you will hopefully never need. Taken from this angle, term life insurance can be conveniently portrayed as a waste of money, perhaps a valid argument for those who view insurance as investment.

And what if you don’t? Read on for the lesser heard benefits of term life insurance plans.

The real purpose of a death benefit

As you may already know, a death benefit is a lump sum paid out to chosen beneficiaries when you pass on. Death protection being among the main reasons for purchasing a life insurance plan, its primary purpose is to provide for those who, upon your passing, lose a source of income.

In life, your income may provide for your family, as well as fund your children’s education and sustain regular repayment of debts, among others. A well-planned death benefit can replace your income by financing this status quo, so your debt does not fall to your family to manage after you are gone.

The temptation may arise to view payout as a chance to profit, but the death benefit is rather intended to provide your loved ones with financial security in times of tragedy. With this in mind, a term life insurance plan begins to make a lot more sense.

Protect the present with the future in mind

An effective way to approach term life insurance is by considering the remaining length of time for which your loved ones will depend on you financially. By purchasing a term life insurance plan to protect you for this period, you ensure your children are provided for until they can support themselves, while buying your spouse time to get back on their feet.

Term life insurance can also encompass the function of mortgage insurance. While the latter ensures you can service your mortgage repayment for the entirety of your home loan tenure in an unfortunate event, the death benefit from your term life insurance plan can also help repay outstanding home loans, lightening the burden of debt on your family’s shoulders.

Free your finances for big dreams

Given that term life insurance plans provide protection for a shorter time without accumulating cash value, they correspondingly cost a fraction in premiums of whole life insurance plans, with high coverage at low cost.

By design, insurance is better suited to providing assurance rather than breathtakingly high returns, and term life insurance is one of the many types that serve purely protective purposes. Good term life coverage equips you with affordable, strong financial defences, freeing more of your funds for investment with potentially higher returns.

About our term life insurance options

Here at Tiq, term life protection is even simpler than it sounds. Our DIRECT – Etiqa term life plans provide a sum insured of S$50,000 to S$400,000, while ePROTECT term life will insure you from S$401,000 to S$2 million.

With no medical underwriting required, your plan offers the options of a 5-year renewable term, a 20-year fixed term or protection till the age of 65 – convenience and flexibility to keep your loved ones safe for however long you choose. With DIRECT- Etiqa term life, enjoy an add-on for coverage on 30 critical illnesses. Learn more about our term life insurance plans here.

End

As buying a life insurance policy is a long-term commitment, an early termination of the policy usually involves high costs and the surrender value, if any, that is payable to you may be zero or less than the total premiums paid. This policy is underwritten by Etiqa Insurance Pte. Ltd. (Company Reg. No. 201331905K). Protected up to specified limits by SDIC.

This content is for reference only. You should seek advice from a financial adviser before deciding to purchase the policy. If you choose not to seek advice, you should consider if the policy is suitable for you. This advertisement has not been reviewed by the Monetary Authority of Singapore. Information is accurate as at 8 June 2020.

Tiq by Etiqa Insurance Pte. Ltd.

A digital insurance channel that embraces changes to provide simple and convenient protection, Tiq’s mission is to make insurance transparent and accessible, inspiring you today to be prepared for life’s surprises and inevitabilities, while empowering you to “Live Unlimited” and take control of your tomorrow.

With a shared vision to change the paradigm of insurance and reshape customer experience, Etiqa created the strong foundation for Tiq. Because life never stops changing, Etiqa never stops progressing. A licensed life and general insurance company registered in the Republic of Singapore and regulated by the Monetary Authority of Singapore, Etiqa is governed by the Insurance Act and has been providing insurance solutions since 1961. It is 69% owned by Maybank, Southeast Asia’s fourth largest banking group, with more than 22 million customers in 20 countries; and 31% owned by Ageas, an international insurance group with 33 million customers across 16 countries.

Discover the full range of Tiq online insurance plans here.