Plug the critical gaps in your critical illness insurance coverage

Address protection shortfalls to maintain dependants' living standards in case of loss of income

In the case of critical illness, a working adult here has critical illness cover of just $60,000, well under LIA's recommendation of about $316,000, which translates to about 3.9 times the average annual pay of $81,663. Such gaps could mean a family
In the case of critical illness, a working adult here has critical illness cover of just $60,000, well under LIA's recommendation of about $316,000, which translates to about 3.9 times the average annual pay of $81,663. Such gaps could mean a family being unable to pay a mortgage and/or the loss of education opportunities for children.ST PHOTO: TERENCE TAN

When critical illness strikes or when a breadwinner dies, financial trauma can soon follow in the form of high medical bills or the loss of income, so it is essential to shore up your defences.

The first step, and it is a critical one, is to identify protection gaps - the shortfall in the amount of cover needed to maintain living standards of dependants - and plug them.

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A version of this article appeared in the print edition of The Sunday Times on May 06, 2018, with the headline 'Plug the critical gaps in your coverage'. Subscribe