er.. yes insurance IS a waste of $.. IF one can cover the financial risks themselves.
what other things in this world one buys/pays AND hopes never to collect / benefit from?

Insurance is useful for most folks for risk transference at a cost if one can't cover the possibilities of certain financial risks themselves.

Yes, all insurers AND agents are out to make a profit - so?
No meh? Nothing wrong with profiting from good products and services provided mar.
Just that some miscreants mis-sell and other miscreants fake their data to get cheaper premium
OR does "questionable stuff" to claim their insurances.
Cheating is on both sides ar - so what's your point?

So where is God or who's playing God in all these ar? hm?
Most posts are asking folks to ascertain their situation properly themselves instead of being "sheeples" to some BS-ing agents / ConSultants.
Luckily some (minority so far) calls a spade a spade.
So where's / what's your real beef?

If company cover the medical already, then personal medical is not a priority already. (not to say one cannot have, just low in prioritisation )

For my knowing that most under employed people are poor to middle class people, and majority don't have unlimited budget or most can have little saving left every month.
To have double medical insurance (company + personal medical)? while every month left nothing for saving or for other purposes? It is a good financial planning?
Since budget is tight for most middle class people, there is always need to prioritise.

For eg.
Company already provide medical coverage, so don't need personal medical immediately, but look for life coverage.
While if the person is not bread winner of family, then life insurance is not the most important to have.

At young age, it is important to save enough for emergency fund, built up capital for investment.

As investment is the one that can turn a person faith of future down the road. As with capital, one can start a business, change the coarse of one entire life career, as well as investment can provide passive investment, and capital gain, that may also change the path of a person life.
vs
never can buy enough insurance, until left no money, then struggling for the rest of the life (extreme example only)

So take up or not to take up certain insurance is also an important part of financial planning.
Not taking up certain insurance is not mean that the person doesn't know financial plannning!



This post has been edited by cherroy: May 26 2014, 02:56 PM

noien FYI

Insurance can serve as tax and estate planning/liabilities proof issue for wealthy person, in fact, it may the primary reason why they take up insurance instead of the coverage issue, as they are self insured already.

planning to take medical card and insurance with return for myself,wife and newborn daughter.what will be the best option?for me and my wife full coverage and payment should be waived or paid by returns in older ages or cash in hand,for my daughter for future education expenses.kindly suggest me some options

cherroy,

I did not even imply one must buy insurance exceeding their budget or needs. One must buy what one can afford, but also based on their needs. Lazy to elaborate..many have written about it here.

young ones must save enough for emergency fund? Correct. But what is your definition,of emergency fund? Accidents, illnesses right. Not for airasia or shopping. But the young ones never put ins as a priority bcos money is never enough. We were all young before, we know.

how,many warren buffets are there..investment experts I also willing to pay and learn from them. Can invest, become rich and forgo any form of insurance is most ideal. I become my own insurance. I guess millionaires don't buy insurance, not even for their private jets.

this forum is now becoming a place where shares their opinion on strong reasons why not to buy insurance. Not how and what is insurance. Some ppl wanting to buy or know abt insurance after reading some comments here will start thinking oh yes, I can invest and become rich..insurance is not a priority. I just think it isn't right.

Bro, great explanation on financial planing.

But sorry I gonna disagree for the medical insurance part. I have some friends, one of them diagnose with nose cancer, another with SLE. My friend with nose cancer have to resign in order to receive medical treatment and surgery, in other words, he had lost the company medical insurance. Both of them are very young, 28 and 25 only. But they will never get a medical insurance or upgrade medical coverage any more.

Without medical insurance, all the emergency fund had go into medical cost and treatment already.

For them, the greatest wealth is health. It will be impossible for them to think about investment or business. We always take for granted to have a good health, but once in illness, all those wonderful dream will disappear and everything will prioritise on health.

FYI, company medical insurance is group insurance, not a life/individual insurance. Once the person resign, he will lose the medical coverage.
Medical Insurance is not for everyone, or when you have money, you can buy as much as you need.
Too bad it is only for healthy person, and if the person get older, the higher risk and harder to get approved. I had a client, his medical insurance had deferment, now pending medical checkup. I just hope everything will be OK without loading or exclusion.

Medical Insurance are as low as RM5 per day for age 30 below, even cheaper then a Chatime. Is that still very expensive or too heavy?

This post has been edited by conqu3ror: May 26 2014, 07:57 PM

but most company are cheapskate which cant buy premium for their employee.
the saddest part of it is they higher management will get better benefit of the insurance and not the floor worker.

so it is a must to buy and don buy those exp package. try to get the minimal for safety purpose

As said before prioritisation, as not everyone can have everything.

We need to assess, (A)
1. The chance of one being unemployed
2. The chance being being sacked
3. The chance that company doesn't pay your monthly salary,
that result in lose of income and need emergency fund to survive through the period
vs
(B) The chance being hit by cancer at young age,
that need a medical insurance.

So which has greater chance of occurring that we prioritise it first, so if (A) probability is high, then we prioritise and monthly disposal income for A. If got extra the no harm to allocate to B.

When agent introduce medical, said per day Rm5, cheaper than Chatime
When agent promote life insurance time, then said Rm5 per day, less than coffee bean
When being introduced with saving plan, then another Rm5 per day, less than starbuck
When being introduced broadband package time, Rm2 per day, very cheap.

This world everything is cheap.

For me, my view on cashflow and financial management, (one can disagree, I can accept it)
If I have no cash, no money now, I may die now due to starvation, debt ridden etc reason, even I have million of insurance coverage.
I may have 1 million of medical insurance, but due to whatever reason, I have no cash money for immediate treatment, buy medicine, or paid tax fee to go to panel hospital I also may died due to it.

If one cannot sort out immediate cashflow issue, one has fail the financial management, that's why emergency fund is the top priority in my book.

Some may say what if I being hit by disease, cancer etc, with no medical insurance.
If I am poor and cannot afford it, so be it, I died because I am cheapstake. This is cruel world, not a charity world, and insurance is not doing charity work as well.
I poor now, I need to sort out every month cashflow, and build wealth at early stage of career. Even though medical insurance is more expensive at later year, so be it.

Emergency fund is some money that can be drawn immediately when you need money time.
Be it money in bank saving, FD, bond or whatever that allow you to access the money.

This is insurance talk topic.
Whether one needs the insurance or urgently need an insurance or not, is also very important aspect to look at.

As in the topic, we also see people buy life insurance for new born baby.
Life insurance is for breadwinner of a family, why people buy life insurance for new born baby when the baby cannot generate any income in the first place, already shown there is some issue about knowing the insurance function and prioritisation.

No one bash insurance nor telling people not to buy insurance, but most talk is about whether the needs of insurance.
Insurance is about the need for it by a insured person.

It all boils down to your affordability, as mentioned by wongmunkeong and the amount you are comfortable to pay. The insurance part can be done progressively as the income increases.

RM 5 per day may sound cheap, but for a fresh graduate who earns RM1500~RM2K, it is everything due to high costs of living. This is why when we sell insurance plans, we have to do proper fact finding.

Not to self praise, but there are times that even if the prospect wanted to buy more insurance, I told him NO , because based on your income, this is the budget that you should put in to insurance.

If you put too much you will have very little left for investments, or buy a property for stay, and later to get married, all those costs $$$.

BTW, even if you have RM1m medical insurance, if its time to go, its time to go. No one can play God. Steve Jobs can afford to buy hospitals, but when its time to go its time to go.

I know, thats why I summon you here

Point is, don't put in too much into insurance until kena makan maggi mee everyday

if need to eat maggi mee then it is time to jump ship.haha

+1

No one can play God. We never know what happen next. Same to MH370, Jeju's Ferry, and karpal Singh.

As some said, if I died, then end of topic. Why worries and get an insurance to left the money to someone.

But what if the case, the person not die, then need someone to take care and heavy medical treatment. Think about the person loves one & families, his/her family will be the one suffer to take care the person and paid for the medical cost. (If still have argument, then I have nothing more to said, probably he/her totally alone in this world)

If a person can't even afford his/her daily meal, then better find a meal then insurance. But in Malaysia, job opportunity is everywhere, there is no excuse you can't feed yourself but you afford own an iPhone/smart phone.

This post has been edited by conqu3ror: May 27 2014, 01:50 PM

Dear Cherroy,

The word 'Life Insurance' for baby here actually means the Medical Card, Life (juvenile lien applies), critical illness etc. Not only death insurance. It's an education or life insurance policy as we call it. Not only buy life/ TPD.

No need for children to have big amount of life insurance, and insurers have this 'juvenile lien' applied on it, means the payout for death will be lower for the first 6 years of child's age. This is to avoid parents buying large amounts of life (death and TPD) for the child and try to claim it.

What do you guys think about children's educational funds that cover the death of the children? The return is exceptionally low too, close to being the same as the amount that you put in at the end of the term.

Why not insure the bread winner and put the in bond funds, then absolute assign or nominate the proceeds to the children?

If the returns is exceptionally low and close to being the same as the amount that you put in at the end of the term, it is not even called savings. At least if you were to put it in bank savings it generates some sort of interest returns.

This is why i keep stressing that insurance is for PROTECTION. When you buy insurance, just treat it as an EXPENSE, and not hoping to get anything. If the insurer does pay you, consider it as a bonus.

If the child suddenly sick or have accidents while going to school, immediate medical attention that costs you $$$ is what we are worried of.

Noted! We are on the same page.

For MLTA/Life that is focussed solely on protection though, would you recommend reducing the premium as low as possible so that the policy is really focussed on only protection? But if that is the case, the investment returns would look so bad that the policy holder would have to top up mid way in life.

Ive seen several policies with too high a premium, sure the investment returns are "good" but those monies should be invested in a separate account meant only for investments.

What do you think?

Even if the policies are invested in a separate account only meant for investments, there is no guarantee that the policy holder will not be required to top up mid way due to the cost of insurance increasing as we gets older and how the fund performs over the years.

Investing in mutual funds does not necessarily guarantee the returns. Eg China Select Fund. We all know that the last financial cycle was in 2008, that was the best time to invest but even so, it depends on luck.

Everything needs a detail study before investing, otherwise, you gonna get burn. Having said that, no one can foresee the future. Cadburry and MAS share..

Now with KLCI > 18xx points, whoever invest in mutual funds is only making the fund manager or agents rich since most funds are relative to how the market performs. Yes, this is the time most agents will sales talk of doing dollar cost averaging to confuse the client. If you keep investing when the market is high, arent you buying lesser units?

MLTA is rather fixed vs the premium, there is no way for us to lower it, but MLTA serves for the loan, whereas life insurance is more towards income replacement. For example, the death of the breadwinner will have substantial financial impact to the family.

What Cherroy and wongmunkeong is stressing is that do not mix investments with insurance.

can buy aia family package