Things you didn't know about Singlife MINDEF Group Insurance (v.s. private term insurance)

Updated: Nov 2, 2023

In this article, we will explore the age question of whether you would be better off getting private term insurance or Singlife Mindef group insurance for your life insurance overage needs.

A crash course on Singlife's Mindef Group Insurance

Pros

Cost is cheap for death and personal accident insurance coverage till the age of 65
Policies are accumulative and not accelerative (e.g. claim in CI coverage will not reduce the sum assured of death coverage)

Cons

Coverage only last till the earlier when either your spouse reaches the age of 70 or your children reach the age of 25 or get married
Early Critical Illness coverage is not comprehensive - only 10 conditions.
Low claim limits for early and late-stage critical illnesses – which may not be enough
Premiums for critical illness coverage are not levelled and increase with age

Maximum claim/coverage limits:

Death: $1,000,000
Personal accident: $600,000
Early-stage critical illness: $300,000
Late-stage critical illness: $350,000

Premium behaviour

Mindef Group insurance vs Term life insurance

From the chart above, it is evident that:

Mindef Group insurance is not a sustainable option after the age of 45
Based on the total cost of the policy from purchase age till age 65, purchasing private insurance will always be cheaper than Mindef group insurance

Basis of comparison:

Male, non-smoker
Coverage duration from age 21 to 65
Coverage: Death: $1,000,000 & Late stage CI: $350,000

ECI and Personal Accident plans will be removed from consideration as they are not an apple-to-apple comparison.

Summary

Singlife's Mindef Group Insurance is good for their death coverage given the cost payable and benefits receivable.

As to the use of Mindef Group Insurances for Early and Late-stage critical illness coverage, it is not beneficial to you as:

Cost increases based on age band
ECI coverage is not comprehensive

Personally, I would prefer the use of private term insurance as:

Coverage is more comprehensive
Cost is levelled and calculated based on the age of entry
Flexibility in selecting your insurance duration – the ability to tailor it to your needs

Let’s not forget that we have yet to consider the option of whole-life insurance.

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