Surrender - Have You Planned?

Is It Okay For Me To Own Two Of The Same Policy Type Under One Insurer?

This is one common question that I have gotten from my clients and if you are one of them who have been asking around for an answer, the answer is a simple yes. But if you are referring to those health insurance, e.g. Shield Plans, you can only have one.

What You Need To Know About Owning Two Or More Same Policy Type

Basically you are not restricted to applying or owning two or more of the same policy type under one or two insurers. But for most insurers, you are only limited to the amount of coverage you are entitled to – and it can be based on your annual income (also quite subjective).

So how does it go? For example, some insurers may limit the amount of death coverage you may get under them up to a maximum limit of 10 – 20 times (or any multiples which you need to check out with your Financial Planner) of your annual income and also based on your current age group. For Total and Permanent Disability coverage, the common limit is around $1 million and likewise for critical illnesses coverage (recommended to verify as well).

That’s why you are not restricted to owning more of the same policy type but only limited to the amount of coverage you have with them. This is also one reason why in your insurance application form, it’s common to see a particular section that will ask you on the total number of insurance policies you have and the total amount of coverage. You may also be asked to provide a copy of your income tax as a proof to your current annual income status – the moment you apply for a certain amount of sum assured.

The Benefits Of Getting More Of The Same Policy Type Under One Or More Insurers

If your Financial Planner has done a financial planning review with you and recommended that you ought to get more insurance coverage but your rejection to him is that you are worried of the above – this particular section will share some light and maybe help to change your mind a little.

This is because there are certain benefits to getting more than one of the same policy type and even under more than one insurer. Benefits like:

1. You Get To Choose How You Want To Claim Or Surrender