Map your current cover against your personal and business risks, then rank the gaps.
Find your policy documents, the buffer figure you worked out in lesson 6.2, and the risk list you made in lesson 6.3, and set them beside a blank page. With those three in front of you, the exercise takes about thirty minutes. At the end you have one page showing every risk you carry, what covers each one today, and where the real gaps are.
That page is your cover map. It brings together three lists from earlier in this module: what you gave up when you left your job, how long your buffer lasts if your income stops, and the business risks your work carries. Lesson 4.4 of The Singapore personal finance system, "Find the gaps in your cover", built a similar map for personal risks only. Working for yourself, you carry business risks as well, and this version puts the two kinds side by side.
Start with the personal risks, one per row. Hospital bills covers a large bill after an admission or a serious treatment. Losing your income is illness or injury that stops you working, the risk lesson 6.2 dealt with. Death concerns the people who rely on you, such as a partner, children, or parents you support. Long-term care means needing help with daily activities for years. If no one depends on your income, write a note beside the death row, since that changes how much weight the row carries when you rank later.
Under those, copy in the four business risks from lesson 6.3: client claims, injury to others or damage to their property, equipment, and unpaid invoices. Your own work may carry a risk the list misses, so add it. Someone who drives for a living might add vehicle damage, and a tutor teaching in students' homes might add injury to others. That gives you eight rows at minimum, plus whatever you've added.
Beside every row, record what protects you against that risk right now. Protection can come from four places: national schemes, policies you hold yourself, terms written into your contracts, and your buffer. Some rows will draw on two or three of these, and some will have none.
Write only what you've confirmed, and name it exactly. MediShield Life against hospital bills, or CareShield Life against long-term care, counts as an entry. A feeling that you're probably covered somehow does not count. Pull out the actual policy and read what it pays for. National schemes also stop somewhere: MediShield Life is designed around certain ward classes, and a stay in a higher class costs more than the scheme is designed to pay.
Mei is self-employed. She works from home and from cafes, depends on her laptop, and has contracts that cover image sourcing and approvals. Against hospital bills she has MediShield Life, with no shield plan of her own so far. Against losing her income she has the 23-week buffer she calculated in lesson 6.2, and nothing once it is used up. Against death she has no cover, and no one currently depends on her income. Against long-term care she has CareShield Life, having confirmed she is covered, and nothing beyond it.
Her business rows look different. For client claims she has no insurance and relies on what her contracts say about image sourcing and approvals. For injury to others she has nothing, though working from home and cafes keeps the chance small. For equipment she also has nothing, and a broken laptop would stop her working. For unpaid invoices, her contract terms let her take a deposit on every project.
Once every row has an entry, mark each gap, meaning any row where cover is thin or missing.
Put the gaps in order of damage, which you judge with two questions. How much money could this cost you, adding bills and lost income together? How long would it set you back? Leave aside how likely the risk feels and how often you hear people talk about it. A gap that could drain your buffer and push you into borrowing goes near the top. One that would cost a few hundred dollars goes near the bottom, even when it's the more likely event.
Mei put income beyond 23 weeks at number one, because a long illness would leave her with neither income nor buffer. At number two she put hospital bills above what MediShield Life pays, since a long private stay, or a ward class above the one the scheme is designed for, could cost far more than her buffer holds. Her laptop came third. Replacing it at short notice costs S$2,400 (an example figure), and a few days of lost work on top would hit her buffer hard without emptying it.
Her death row sits low for now because no one depends on her income. She noted on the map that it would move up if she had children or began supporting her parents. Your own order can shift in the same way whenever your circumstances change.
Below the rows, write your top three gaps in order of damage, with one sentence on each saying why it sits there. Mei's three are income beyond 23 weeks, hospital costs above MediShield Life, and her laptop.
Before you put the page away, look it over once. You should see the eight risks and any you added, today's cover next to each, every gap marked, and your top three written at the bottom.
The map tells you where to look. It does not pick a policy for you, and the course won't name one either. Before buying anything, take your ranked list to a licensed financial adviser, or work through Insurance Decoded.
If you see an adviser, open by walking through your gaps from the top of the list down. For every product they put forward, find out which of your gaps it closes and how its cost sits against your budget.
Gather your policy documents, your buffer figure from lesson 6.2 and your risk list from lesson 6.3, then start your map.
Fill in the freelancer cover map. Then write your top three gaps, starting with the one that could do the most damage.
Junxiong-WFG Organisation is an authorised representative of AIA Financial Advisers Private Limited (Reg. No. 201715016G).