Most probably not. Normally agents who knows nothing on investment sell insurance better.

Heavy monthly premium doesn't mean someone had over-insured. Heavy monthly premium probably because he buys endowment plan instead of term plan. Many of them thought that they are over insured because they are paying high amount of premium every month, but when something unfortunate happens to him, then he only realize that the plan he bought may not be able to help him, even though a big portion of his income has contributed to the insurance company.

To determine whether someone has over insured or not, we should see the insured amount vs commitments, not the amount of premium paid vs income.

Hi,

You're right. That's way I seldom see anyone can be over insured.
It can't be denied that insurance premium itself can increase someone's commitment. However, insurance is meant to lessen someone's burden, not to increase someone's burden. If someone have a very tight budget to buy protection, it simply means that he is having a lifestyle that his income could hardly afford. But this has nothing wrong here. People earning the money have the right to decide how to spend his money.

If someone's budget for insurance is low, then he should stay away from endowment plan and whole life plan. Try getting a plan that can maximize the protection with the amount he afford to pay, such as term life plan or investment-linked plan when he is still young.



Regards,
Gavin Lim from AIA Bhd.

This post has been edited by gavin_lim: Sep 10 2013, 01:00 PM

Yes. I have PRS license with Kenanga (previously ING Funds Bhd.)

In some countries, insurance agents are not required. Their peoples knows that insurance is a needs. If they want to buy insurance, they direct go to the branches. If they don't understand, they heed advice from the Financial Planner with charges. Insurance companies don't even have to pay commission to agents to do hard selling.

In Malaysia, many of us don't even know how important insurance is. Some more 80% of agents are doing hard sell without adequate knowledge. So people don't even bother to listen. In most cases peoples are "forced" to buy insurance without knowing what they have bought.

When we want to buy insurance, "support" is a grave mistake to start with. Insurance is not something we can see its functions until unfortunate event happened to us. When you buy insurance because of relationship, most likely you can never learn about how the insurance can help you, or you may not know whether the policy you bought can help you to survive a financial crisis when an unfortunate event really happens.

Some people think that buying insurance makes their life more peaceful, while the others think that no insurance agents makes their life more peaceful. None of them is wrong. We have the right to define what our peaceful life is, don't we? For me, no "relationship" selling makes my life peaceful. If everyone buys insurance because of relationship, then I gotta eat shit!

Hi,

Sorry I didn't receive your PM. Would you mind PM me once again?
Alternatively you can send to my email at cheahyang.lim@aia-premier.com.my or cheahyang_0@hotmail.com


Regards,
Gavin Lim from AIA Bhd.

For the same premium amount, investment portion have a much lower commission rate than insurance portion. If an agent concern about bigger commission, he will try pushing savings plans instead of investment-linked plan.

Risks has been around as long as human existence. Even though singles don't have dependants, doesn't mean their life is risks free. Singles still expose to the risks of sicknesses, disability and etc.

However, people have a choice to either self-insured or transfer the insurable risks to the insurance company. It's just a matter of choice.

When we buy insurance, there's something we should learn about which is called INSURABLE RISK.

Element of insurable risk state that the risk exposure MUST BE LARGE. There must be enough exposure to the risk for the frequency to be predicted and to be grouped for the purpose of establishing rates. When a risk is unlikely to happen, it CAN'T BE insurable. Just like you see the SicBo game in the casino, there will be no slot to bet for 2 points and below or 19 points and above. When it is unlikely to happen, who will be stupid enough to place a bet on it?

When a person is suspected of being severely sicked, definitely no insurance company shall entertain his insurance application. This is because insurable risk MUST BE due to chance and randomly selected. Accepting insurance application from an unhealthy person will be very unfair to the other healthy policyholders. Just like we buy 4D, we can't possibly make our bet when the result has came out. If we can do like this, everyone shall place their bet at 8pm on the 1st prize no of the day.

In Malaysia, not everyone is born to be rich or capable to earn a milion a year. Most of us are suffering in our livings and have insufficient savings to cover any emergency expenses. Insurance is one of the way to create a big fund for emergency purposes at the shortest time possible. You may be an active investor that earn high return from your investments. However, the higher the return, the more fluctuate the market trend it will be. No one can say his investment is guaranteed earn big at all the time, is it? What if the investment return is not meeting our expectation at the time we need it for emergency purpose? Of course you may say you are willing to take the risk of loss, but I don't think everyone have such a high risk appetite.

Some people think that rich people don't even need insurance in their financial planning. Well, I think it depends. If the rich person can make sure his cash can reach his beneficiaries hands before everything get frozen, why do they need insurance? However, how many can do that in time? How many rich people will keep his savings at home? How many willing to provide ATM password to his spouse and beneficiaries before he dies? After his estate being frozen, it is not surprise to take about one year to complete the estate transfer process even if he has made a written Will prior to his death. Not to say those rich chineses with billions estate and "pantang" to write his will before he dies, which may take forever to process the transfer of estate.

Insurance is one of the good way to solve a financial problem occurs when an unfortunate event has happened to us, but I'm not saying that this is the only way. Just like you say if you want to eat at outside. You can go to cafe, restaurant, mamak stall and etc, the choice is totally all up to you. I think there's nothing wrong no matter what your decision is, as long as it suits your appetite.