Dreamer, I do not care how much the prospect life is worth. I really do care if he and his dependents are adequately covered.
Rule of Thumb of 3 - 4 yrs, is the minimum. If someone has the money to insure 10x his annual income, and he wants it, why not?
People get insurance for different purposes.
- A foreign customer of mine, get insurance just to enjoy the tax relief. Yes, premium MYR6000/yr
- Some get insurance for their children just because of love, money to them is nothing.

I'm sure you have your own reason of getting insurance. But each people have different reasons, and of course NEEDS.
A lot of time, client will tell us what he needs, then we need to analyze if his needs is logical or not.
And I don't deny, if his needs is larger than adequate and yet he can pay for it, why should I stop him?
If his needs is smaller than adequate, but his income is more than enough to increase the coverage, I would advise him to increase the coverage.

For example, JLo, insure her butt for few millions, is it insane?
A lot of singers who are already wealthy still insure few millions on their throat, does it make any sense? Do they need it? It is up to themselves to decide.

You say you're educating, but to me, you are just forcing your own opinion into other people's mind. Maybe that's your way of education.

---

Added on May 5, 2009, 7:29 pmSo you mean you want a coverage of (Insurance coverage + EPF Acc) = RM1.5M?


This post has been edited by bbjslee: May 5 2009, 07:29 PM

HLA.

Actually, i've just called to enquire, and it seems I can. However, the agent has told me that it is more or less like switching to a new policy.
- My Insurance premiums will be recalculated to start based on my current age (my previous policy was bought 3 years ago)

To give more details about the policy:
- Insurance component is made up of life coverage (up to 100yrs), TPD and PA
- The investment portion goes to about 3 different HLA UT funds.

Is what the agent said true? What else do I stand to lose by 'switching' to a new policy.

Also, does this mean that the premiums I've paid over the last 3 years are essentially wasted? (excluding the investment portion)

This post has been edited by huntedmunkie: May 5 2009, 11:41 PM

i'm surprised that you ranked CI below life and medical; because even if CI is low risk, if i do get it, it would be catastrophic.

but again, how much PA/TPD/Medical/CI is adequate?

300k/90k for medical? or less and top up in future?
100k CI/TPD? (3-4x annual income)
200k PA?
and maybe some annual income to round it up? 10-20k/yr in event of disability and another 10k/yr in event of CI?

i m a young grad with no dependent. company have some group medial card/

lin00b,

From FINANCIAL standpoint, both TPD and CI are equally devastating. But, YOUNG people has higher likelihood to get TPD than CI.

Remember, insurance can only solve your financial burden and nothing else.

Eventually, you have to make your own decision. I am just giving you ideas on what to think about.

Dreamer

This post has been edited by dreamer101: May 6 2009, 01:12 AM

1. You don't have to switch to new policy.
2. Call up HLA customer service to check. (if you agent is telling the truth)
3. It depend on how you look at "wasted", if you've claimed before then it is not wasted.

- Agents will lose out in his commission if you should decide to decrease your premium
- Agent's promotion (year end) will be affected if you should decide to decrease your premium or surrender the policy.
- If you decide to surrender the policy, and later decide to get another policy within the same year, the insurance company will have lots of questions for you. It is industry ethic that we agents should not coax/persuade/trick policy holders to surrender their current policy and get a new policy from us unless it is really necessary.
- All the insurance company in Malaysia share a database. Yes, they know if you have insurance from other company and how much is the sum assured.
- Only underwriter & claim department can access the database, not the agents.

---

Added on May 6, 2009, 8:12 amPA is very cheap.
Jusco Card Members also got PA insurance.
For OAC, 200k coverage is RM300/yr. Do get a PA if you travel often, especially on cars/motor and even public transport.

For medical card, check with your company 1st, what are the term and condition, the limits. Then you can make a better decision on it.
According to newest edition of Personal Money, medical cost rises on average 10% / year.

For CI, coverage for 3-4x annual income would be sufficient for now. Later on, when you life changes with family or new responsibility, review it again.

PS: May edition of Personal Money have few articles on Medical cost & insurance as well as Understanding ILP returns. So for those looking for medical insurance, I would advise to read it.

This post has been edited by bbjslee: May 6 2009, 08:12 AM

No. I want an insurance coverage to match my potential EPF accumulation of RM 1.5M. This is just an assurance that should anything unwanted happen to me along the way, I have a second nest egg to fall back on.



So, any idea how much would the premium for a simple TERM INSURANCE for SA = RM 1.25M for 20, 25 & 30 yrs years.

Thanks,

Xuzen

@xuzen

In order to give you a rough estimate, three things are required.

1) Your birthday
2) Occupation
3) Smoker or non-smoker

i) Next b/day is 35y/o
ii) Office worker
iii) Non smoker

Xuzen

Xuzen,

I have something here that would help.

Term Life 1.25M @ 30 yrs = RM 8375/yr
Term Life 1.25M @ 25 yrs = RM 7100/yr
Term Life 1.25M @ 20 yrs = RM 5762/yr

Another option:
ILP 1.25M @ 20,25,30 yrs = RM 7200/yr

This is based on the details you've given.

rgds,
Ronnie

Ron,

Is term life something that is burned right if there is no claim. I mean there is no Cash Surrender or Residual Value right?

Xuzen

Xuzen,

Thats very true. This kind of policy has nothing in the end, so just treat it as car insurance whereby u just get the protection u need! For your age if you opt for ILP, its more worth coz if you surrender you still get back something, but definitely you won't untung from it.

Ronnie

chew_ronnie,

So, if we have bear market for a few more years, a person has to pay more in premium to ILP than what you are quoted. Am I correct??

Dreamer

Dreamer,

You are very very right as we cannot predict the market. So that is the risk with ILPs. There is no guaranteed returns in ILPs.

Ronnie

Ya, this is a charateristics of ILP which some of the agents don't want to tell their prospects...

This post has been edited by lcl832002: May 8 2009, 10:29 PM

I think the one that invented the idea of insurance is genius. He just applied the concept of running a casino into insurance business. "Banker" takes the most. Everyone buying insurance just like playing in casino. Do you know anyone can beat the casino????? Playing in casino is 1000 times worse than playing in stock market.

Being a policy holder in life insurance, you can never benefit it in your life. You are buying something that you are not use it, enjoy it, benefit from it in your few decades life. This is violating the concept of consumption.

Someone argue that you can leave some money to your love, your family. If you can't earn for them when you exist, what's point to give them some after your death. In fact, many of the life policy claims even less than the total amount of your premium paid. All those MULTINATIONAL companies with Geniuses Have calculated how to put your money into their pockets, why do u think you would win them?! Why would they sell service by your door mat and buy you coffee and make time to meet you to make you buy their products/services?

Someone said insurance can help you to save money. That's the most ridiculous thing in the world. I've a guaranteed insurance policy that total premium about $300k but 10 years later i can only get back 350k. Even apply some old fashioned compound interest rule, i can even have more than 350K in 10 years time + my money needed to be locked up. What's the point to buy insurance????

The fact is insurance genius also knew only life product cannot fool the people forever. “You may fool all the people some of the time, you can even fool some of the people all of the time, but you cannot fool all of the people all the time.” Quoted by Abraham Lincoln. Ppl would recall this quote in Mortgage Backed Security crisis. They included saving factor into the life products to continue to fool people.

The reason when the majority bought insurance is becos they think this:
I put my saving of A amount and gain 20% in 10 years while I KNEW i didnt need this money during this 10yrs and I didnt have some other better place to help me gain this at this low risk.

But if you think you deserve a little courage to try earning your own money in your own way, u shouldnt buy insurance.

**

My view on buying insurance are when you:
1) Unable/Lazy to save money
2) have extra money but zero investment skills

Find a decent insurance agent or read more on insurance before putting your flesh and blood money away, by going to -->Mtsen
Referring him doesnt mean I agree with him, but if u do need some insight and true picture, there you go.

This is my real person story. Last time when I was younger, me and my friends go for a long distance driving holiday. We rent the cars, but as we were students there, we were cheap skate, and decided on not buying the insurance which was AUD 150. So long story short, we met an accident, and the whole car was wrecked. Luckily we survived, but we had to fork out money to pay a whole car, AUD 20K. So is insurance necessary? You decide. But I say be wise on what you pay for, not be sold by agent words. First be safe and secure, then be rich. If you are not safe, your riches can be gone in an instant.

I'm very surprised you view Insurance as investment tool & saving tool.

The basic of insurance is risk management. Saving element is just a by product if you're lucky that you never need to claim it.

And of course there is specific saving plans introduced by Insurance Company which has Insurance Features that banks are not able to offer in their saving accounts. In the end it is up to consumer choice.

I wonder is your point about all insurance product or certain products.

Hi there,

You are very true to say insurance companies do make alot of money by leveraging on the profits they generate from policy holders. But putting at the point of view on the policy holders, insurance is a very important risk management tool as BBJSLee has said. Frankly, dun use insurance as an investment tool to generate lots n lots of cash for u in the future. It is just another form of saving for those ppl who does not want any bull bear market risk!

Last question for you, do you buy insurance? Since to you, insurance is BS!

Ronnie

Insurance concept is basic only.
You are spreading the risk with others.

Just like statistically, 2 out of 100 will have accident or need medical expenses. So insurance is just take the rest 98 person insurance premium to pay the unlucky 2.
Insurance just making a pool of money from 100 person, and use the money to pay the unlucky 2. If the premium is not enough then they will raise the premium to cover the money paid for the unlucky one.
In between insurance company make profit out of it, they are the ultimate winner as same as running a bank.

You can save money without taking up insurance as you don't need to pay for the unlucky 2, but you have to bare all the losses incurred if happen you are the unlucky 2.

Nothing wrong with it, if one doesn't opt to get one as it just mean you don't spread the risk to others.

Insurance main objective is let you to share and risk with other, so does other share the risk with you.

But insurance industry now become more complex and they mix bag saving scheme, investment scheme which has deviated from origin of insurance purposes.

Saving scheme, endowment plan, investment linked insurance is not an actual insurance.

Actually, my view only, investment linked insurance is one the worst product as they just take part of insurance premium to invest in UT which one can do ownself through investment house, and more flexibility can be get through investment houses instead through investment linked insurance.

This post has been edited by cherroy: May 9 2009, 04:52 PM