Why Trust MoneySmart?If you’re wondering how much term life insurance is enough to protect your loved ones in Singapore, use these 2 steps to help you get an estimate. First, use the trusted rules of thumb described below. Then fine-tune your coverage using a needs-based formula to get peace of mind and value within your budget.
Key benchmarks for coverage
Here are some key benchmarks you can use for a broad estimate.
Type of coverage | Benchmark coverage amount |
Death & Total Permanent Disability | Aim for at least 9–10 times your annual income for core protection. |
Critical illness | 4 times your annual income, enough for a typical 5-year recovery period. However, note this varies with dependants and obligations. |
Sum assured for parents with young kids and mortgage | Many advisers suggest a S$1,000,000 sum assured as a practical baseline—to comfortably cover mortgages, children’s education, and living expenses. |
Note that these figures are just starting points. Your ideal sum assured depends on your unique family and financial situation.
Tailored needs-based calculation
Next, finetune your coverage. Work out your own required coverage in three easy steps:
1. Tally your liabilities and commitments:
Outstanding debts: mortgage, car loan, personal loans, credit cards
Future expenses: children’s education, parent support, funeral costs
Daily living needs: multiply monthly expenses by the number of years your dependants will need support
2. Subtract your existing assets:
Include your:
Bank savings
Investments (stocks, bonds, properties)
CPF (Central Provident Fund) balances
Existing insurance payouts (including Dependants’ Protection Scheme—DPS, max $70,000)
3. Result = Coverage gap:
The difference is the sum assured to target.
Example calculation:
Mortgage: $300,000
Living expenses: $2,000/month x 15 years = $360,000
Kids’ education: $100,000
Funeral: $20,000
Total needs: $780,000
Minus: savings ($50,000), CPF ($100,000), existing insurance ($200,000)
Gap: $780,000 – $350,000 = $430,000 (coverage needed)
Item | Amount ($) |
Total obligations | $780,000 |
Less total resources | $350,000 |
Coverage needed | $430,000 |
Budget and duration
Once you've settled on a coverage amount, sense-check it against your budget and the length of time you'll need it for.
Set a budget ceiling. Your total insurance premiums, across all policies combined, should ideally take up no more than 10–15% of your annual income. This keeps your cover sustainable for the long run, rather than something you're tempted to lapse when money gets tight.
Decide how long you need cover for. Match your term plan's duration to your major liabilities — typically up to your planned retirement age (e.g. 63–65), or until your youngest child turns 21–25, whichever gives you a longer runway.
Check if that fits your budget. As a benchmark, a 30-year-old non-smoker can get around $500,000 in term life cover for $19-$35 a month, depending on the plan and health status. Use this to gauge whether your desired coverage and duration are realistic for your income.
Lock in your rate early. Compare premiums across term plans before you commit — the price for the same cover climbs significantly with each decade you delay, so shopping around now (rather than later) works in your favour twice over.
Fill in your details to get a premium estimate.
In-market product examples
Provider | Plan Name | Key Features & Coverage Highlights | Entry Method | Max Age of Cover |
AIA | Secure Flexi Term | Covers to age 101, riders for TPD & Critical Illness | Via adviser | 101 |
FWD | Term Life Plus | Up to $1.5M cover, no medical checkup required for $1.5M (≤50yo), CI rider | Online | 100 (renewable) |
Income | Term Life Solitaire | Covers up to $500,000, wide term options, TPD/CI riders | Via adviser | 100 |
Manulife | ManuProtect Term II | Quit smoking incentive to enjoy non-smoking premiums, riders for TPD and CI | Via adviser | 85 |
Singlife | Simple Term | Yearly renewable; up to $500,000, no medical | Online | 86 |
Compare more term life plans on MoneySmart.
