AIA Power Critical Cover as an Option to Mitigate the Impact of Critical Illness

Studies have shown that the majority of Singaporeans lack up to 80% of their critical illness coverage.  Most Singaporeans are not aware that medical inflation in Singapore is in double digits.  In the 2018-2019 period, it even went up to 20% inflation.  This means that while the average shield plan will cover much of it, the critical illness payout will likely be used to cover the deductibles, which can be substantial, or cover treatments that are not on the schedule.

Critical illness also means a lost of income during the treatment and recovery period, if there is a recovery.  This may mean the loss of more than one income stream, partially or in totality, as other family members become caregivers.  This has a knock on effect on the other aspects of family finances and retirement planning.  It may require the liquidation of assets and the cashing in of other policies to cover the cost of living.  Long term care, including medication, lifestyle changes, and changes in diet also add up.

The average Singaporean, on high income, would reasonably need to be covered between $300,000 to $500,000 for critical illness coverage.  This may be expensive, especially for older professionals, but it is preferable to medical bankruptcy, or a greatly reduced quality of life.