The world may be your oyster but it does not mean that you should be unprepared for life's not-so-pleasant moments. Young single adults typically need significant insurance cover. However, you may be constrained by your budget as you've just started your career.

If you participate in dangerous sports like mountain climbing, you need to protect your greatest asset: yourself. You need to protect your income stream and make sure your parents are taken care of if the unfortunate should happen.

To this end, young single adults should consider term life insurance, as it provides several times more coverage for a given annual payment than a whole-life policy. Premiums for term insurance increase with age but for now, that is a minor concern.

Besides life insurance, young single adults should not overlook the importance of sufficient health and disability insurance. Though the risk of critical illness is low at this age, do consider taking up critical illness coverage as well.

The principle is: remember to insure yourself against risks that will leave you financially drained.

Starting a family is a major milestone in one's life. Your decisions will impact not just yourself, but also your spouse and children. Young families typically face important decisions like buying a home, and having children.

Even if both young parents are working, the financial impact of losing either spouse in a catastrophe can be crippling, especially when faced with big mortgage repayments and young children to bring up. If the budget is tight, the young family should increase their term insurance cover and seriously consider whole life insurance, as term insurance gets progressively more expensive with age.

Disability and health insurance cover should be increased to take care of the greater financial impact if one spouse is unable to work due to illness or disability. Young families with newly purchased homes should consider mortgage reducing term assurance. In the event of tragedy, the insurance payout can go towards paying off the mortgage. The insurance objective for a young couple is: to ensure your family does not suffer financially if something happens to you.

For the older couple, the focus should shift towards guarding against poor health and disability.

Health and disability insurance become more expensive with age. With escalating health care costs, such insurance coverage is essential. Disability protection also becomes more important for the reasons stated above.

The older couple should also consider long-term-care insurance, which alleviates the financial burden should either spouse suffer chronic health problem or disability.

How much coverage is enough? The rule of thumb is enough to meet your spouse's lifetime needs. Even with grown, independent children, life insurance to meet the income protection needs of your spouse is crucial.