Jonathan Chua

Many of my clients often compare buying life insurance to gambling. Their rationale is that by paying premiums to cover an insured event, we are betting against the insurance company, as insurance is an expense and one effectively loses the “bet” if the insured event such as death, disability or critical illness does not befall us. It feels similar to placing a bet on a table game in a casino and hoping for a favorable outcome. So is insurance truly like gambling? Let us tackle this question from a risk management perspective. We understand that when it comes to risk financing, there are two options: 1) Risk Acceptance (Not buying Insurance) 2) Risk Transfer (Buying Insurance) Let’s explore the 2 options in detail. Figure 1 – Possible outcomes from being uninsured/under insured Financially, there are 3 possible scenarios that can happen to an individual who chooses not to buy life insurance and accepts any risks along the way. The optimal scenario ...

Insurance should cover every person who seeks coverage, whether or not they suffer from pre-existing medical conditions, chronic diseases or congenital health conditions, said Singapore’s ambassador-at-large Tommy Koh . Speaking on Thursday at an Institute of Policy Studies (IPS) roundtable on Singapore’s population trends, Koh, who is also special adviser to the IPS, said the government should step in to ensure that insurance coverage is fair and accessible for all. He identified insurance as one area where Singapore “didn’t get it right”, touching also on the nation-state’s failure to achieve inclusive growth — more specifically in terms of plugging the income gap. “We need to fix the equity of our existing healthcare system. We have a system at the moment that does not meet my standard of fairness,” he said. “I think the state should intervene and require all insurance companies to insure people with prior medical conditions. There should be no one in S...