Jonathan Chua

Underwriting in the context of insurance refers to the process where insurers assess the risk of an individual applying to take up insurance cover by looking at his medical history and health condition. Unhealthy people will naturally complicate the process, leading to a lot of added paperwork, trouble and complexities. I am not sure whether Singaporeans are really unhealthy, or it is just through self-selection that I encounter many of such people who only look for insurance when they have health problems. Surprisingly, many of such clients are relatively young people who are supposed to be in the pink of health. Difficulties in getting insurance coverage Since I recommend my insurance planning clients to take up beneficial forms of coverage which typically represent less profits and more risk for the insurers, the underwriting process becomes more tedious. Often, a great deal of work is done only for the insurer to decline the case or impose harsh special terms s...

As an insurance salesman for many years, it often puzzles me why people don't buy sensible protection. Why "self-insure" a large risk instead of buying affordable protection? Here is my "Top 10" list of why people don't buy insurance. 1. It is not required. You may be required by a business contract, bank loan or state auto liability requirement to buy insurance. However, in most cases, protection is a choice. No one requires you to buy higher auto liability limits beyond minimum requirements OR to protect your assets beyond the bank lien requirement OR protect your family with Life Insurance. Many people don't believe in buying something that they are not required to buy regardless of the value. 2. Some Don't Believe in Insurance Sometimes a client will only buy the coverage required and then only begrudgingly. They have no belief that the insurance has any value and consider any money spent on it to be a waste. No discussion of t...

As easy as ABC By Lorna Tan, Senior Correspondent, The Sunday Times, 12 June 2012 For most parents, the big-ticket spending item is usually their children’s education once the family’s housing needs have been taken care of. This daunting expense, spread out over the school-going years, includes tuition classes and finally, the king hit: tertiary education. The figure balloons if the child pursues his studies overseas, partly due to unsubsidised varsity tuition fees and higher living expenses. OCBC Bank estimates the cost of a four-year, non-medical degree in a local university today for a Singaporean to be $105,800, including tuition and living expenses. Source>>

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...