Step 1 of 7
Protect yourself with insurance
This chapter builds Level 3. It makes sure one illness, accident or death doesn't undo everything you've built.
- Goal
- Shift big, rare risks to an insurer, so your monthly cash flow stays steady.
- Milestone
- You have health coverage (PhilHealth plus an HMO, critical illness insurance or both) and enough life insurance for the people who depend on you.
- Next step
- List the coverage you already have, like your company HMO, PhilHealth and SSS, then fill the gaps.
Your place on the pyramid
- 6
- 5
- 4
- 3Protecting your finances
- 2
- 1
- Starting point
Insurance is how you manage risk. Its main job is to keep one big, unexpected event from disrupting your normal monthly cash flow.
Without insurance, a hospital bill or the loss of a breadwinner gets paid from your savings, your emergency fund or new debt. With insurance, you pay a small, fixed premium, and the insurer carries the big cost.
Start with what you already have
If you're employed, you're already paying for some protection through payroll. Know what it covers before you buy more.
SSS
- What it helps with
- Sickness, maternity, disability, unemployment, retirement and death benefits, plus salary loans
- Contributions (as of Nov 2026)
- 15% of your monthly salary credit (you pay 5%, your employer 10%)
PhilHealth
- What it helps with
- Part of your hospital and some outpatient costs at accredited facilities
- Contributions (as of Nov 2026)
- 5% of basic monthly salary, split equally with your employer
Pag-IBIG
- What it helps with
- Savings with yearly dividends, plus housing and multi-purpose loans
- Contributions (as of Nov 2026)
- Usually ₱200 from you and ₱200 from your employer each month
| Program | What it helps with | Contributions (as of Nov 2026) |
|---|---|---|
| SSS | Sickness, maternity, disability, unemployment, retirement and death benefits, plus salary loans | 15% of your monthly salary credit (you pay 5%, your employer 10%) |
| PhilHealth | Part of your hospital and some outpatient costs at accredited facilities | 5% of basic monthly salary, split equally with your employer |
| Pag-IBIG | Savings with yearly dividends, plus housing and multi-purpose loans | Usually ₱200 from you and ₱200 from your employer each month |
These are a base, not a full plan. PhilHealth won't cover a big hospital bill in full, and SSS benefits may not replace your income for long. That's where private insurance comes in.
Types of insurance
1. Life insurance
Replaces your income and covers your debts if you pass away, so your family can keep going. Most of this chapter focuses on this.
2. Health insurance
Pays your medical costs. The two main forms, HMO and critical illness insurance, do different jobs.
3. Non-life insurance
Protects your things, like your car, house, travel plans or business, from damage, theft or loss. Get it when losing that thing would hurt your finances.