Yes, medical cost are expensive. Normally CI and Medical cost of insurance will be higher than life/TPD.

Based on your example, it means the cost has now exceeded premium paid, this is where they will deduct cash value to keep the policy inforce.

The higher your coverage, the higher the charges. Medical benefits are normally high. Your life or critical illness cost will also be high if you opt for a very high coverage.

When you don't pay enough premium to maintain such high coverage then sooner or later, your policy will lapsed due to unable to sustain the policy cost.

This post has been edited by lifebalance: Sep 8 2023, 10:35 AM

erm that is my son medical policy, he just 5 yo this year, and i bought 2-3 months after he born...bought on 2019

How come the cost exceed the premium paid? is it because example its expensive for age 0-9 , then cheap 10-30, then gradually increase again?

I'm just curious, is your objective to ensure your financial security or to ensure that agent and insurance company earn less?
Which would help you sleep better at night?

In order to understand these charts, we need to first understand the process flow of all your premiums paid.

So every ringgit you pay in premiums follows this flow:
100% of your premiums paid goes directly into your investment account, less any commissions paid to the agent.
After that, when the company charges for COI, it'll then charge to your investment account, which is where you see the units being deducted accordingly to their unit prices.

And since, from the example given, the portion going into your investment account is at that level, my guess is that your policy is rather new?
My guess mungkin salah ya but it's my best guess la

This post has been edited by JIUHWEI: Sep 8 2023, 10:42 AM

this is the coverage for my son medical



i think its those pretty standard coverage, bed RM 150, annual 90k etc etc. So i dun think the coverage is high. unless it was like i mentoned in previous post that age 0-9 example is more expensive and age 10-30 cheaper then gradually increase again.

my objective is to understand my policy better and for financial security. how do i ensure my agent or insurance company earn less? dun buy then they dun earn lo lol..

because all my insurance policy i bought is before i stumble to this post... and frankly said i dun really understand how it work previously and just buy and hope that whatever bad things happen it can cover for me & my family. I'm those that agent say "just need to pay to certain age then the policy will run itself untill end tenure/i died" , but after reading here it not the case, the policy might need top up anytime or have to continue paying untill end tenure to ensure the policy doesnt lapse...

and for that particular example, its my son medical policy bought year 2019 when he just 2-3 months old, is this policy considered new?

Okay bro, chill sikit. Here we memang will tekan a bit.
Just food for thought ya

No worries, it's good that you have something started.

I am new father, I can understand where you coming from. At least from my narrow perspective.
So if I were you, this is what I will flip through the policy contract to look for:

1. Maturity - at what age does the policy mature/expire?
Why this is important leh?
Because let's say I want to save some money, I choose a lower age of maturity, say age 70. Premium lower, of course I happy.
And what that means is that at age 70, the policy ends. Should there be extra funds in the policy, I may have the option to let the coverage continue until the funds in the policy runs out, but I cannot continue to pay premiums into it, sebab the contractual term dah tamat.

2. Account value projection - look for a chart with the non-guaranteed account value, with scenario 1 and scenario 2.
Why this is important leh?
It's important to you because your objective is clearly for some level of security.
SO if the projection levels at age 70 is just a "-", what I would do is to put up more money into the regular premiums.
Personal preference: I would much rather put up small tickets along the way, rather than be given a big surprise in my golden years.

In what scenario would you need to cough up more money, aka, top-up?
How insurance started is based on the guiding principle of mutual assurance. The same guiding principle is still well and alive today, just that it also developed with the times into all the different selections that we see today. No right no wrong, it just caters to different market segments. So to each, its own.
With that in mind, comes my first point: we are sharing into this medical insurance pool with all the customers of your respective insurance company. Should the claims experience be above and beyond what was projected, everybody that shares into the pool would naturally have to pull more weight.
Secondly, we also need to understand the nature of an investment linked policy.
When interest rates are up, naturally it demands less money from us to sustain the policy.
When interest rates are down, naturally it demands more money from us to sustain the policy.
Of course there are going to be exceptional cases. And the example I illustrated above is just a general guide to understand it.

So with this in mind, we can actually have a proactive role with our policy (hence the importance of reviewing regularly).

If GE have not send you any letter notice, you don't need to worry about anything.

However if you are worried, you can always get your agent to talk to you about the policy.

No issue, recently alot hoo haa about agent thingy, so no problem. definitely will double check all my policy when free.

Something interested you mention in bold, do you mean when the tenure end at age 70, suppose it should lapse and surrender all the values back to us owner, but we can choose to continue/extend the policy let say to age 80, using the values to run the extension untill age 80?


Well to be frank if i just believe and get what the agent says then i wont come to this thread to get 3rd parties suggestion/explanation/guidance...

Ya, let's say I choose my policy tenure to age 70. Yes, premium lower because the tenure is shorter.
If there is account value at 70, then you have an option to exercise the automatic extension; on the other hand you can also choose to let the policy mature, and the surplus account values will be paid out to you.
If just cukup2 cover till 70, then the policy just matures loh...

How long the policy can extend really depends on the account values at that time.
If there is just enough to cover to age 75, then what happens when the funds run out is that the policy just ends.
See how much is there to cover the COI at those ages. And past the policy tenure, we can't pay premiums anymore even if we want to.
Sebab contract dah lupus sebenarnya.
So a bit of homework for you to do (and for those who are reading and learning this for the first time) would be to find out what are the COI charges at that age.
Actually look into your policy and understand it.
Don't need you to chuck this one away and buy new, just informing here so you all can take a proactive role with your coverage.

So we want to be objective, be honest with ourselves on what we actually want.
The agent is not the one living with the consequences.

My intention is just to provide information ah.

And I'm glad you pointed it out and gave us a chance to clarify for everybody's benefit.

hi Rinth, reason being insurance charges for medical is much higher than life insurance is due to the claims ratio and also medical cost in Malaysia. the high insurance charges of medical card is to cover this coverage cost. in terms of whether agent/insurance companies earn more through medical policy, it will come down to very technical term to explain and very complicated. in short, because of the high insurance charges of medical card, hence higher premium. (if got chance to meet up, then only explain to you more on the agent commission part, to explain it here will be difficult and complicated).

also your premium of RM160 will be used to buy funds (example here is the RM121.60) then the funds will be used to deduct all insurance cost+policy fees (RM74.21) then the balance of RM47.39 goes to cash value.

hope the above clarify and answers your concern

RM 121.60 to buy funds, deduct RM 74.21 policy + insurance cost, left RM 47.39 in the funds.

But RM 160.00 - RM 121.6 = RM 38.40 Where this go?

the rest goes to the agency's commission. you can actually check your policy contract document, this amount is also known as distribution cost (layman term, commission)

if you really wanna understand more, asides from your policy contract, you can also study this (commission structure). reading and go through this details is better.

also you can refer to this.

This post has been edited by denion: Sep 9 2023, 12:29 AM

Any sirus in insurance related industries care to comment on ...

Is there a requirement to hv a license from the authorities to gives recommendations or advice to others in insurance related products or its related matters?
Is there an offence when,.... “recommendations or opinions which are likely to induce a person to take any action or position (e.g. buy, sell or hold) regarding a particular insurance products, or instrument in relation to insurance?

As there is a need to hv a license for giving recommendation or advise in matters related to investment In securities or derivatives.
According to the SC, “recommendations or opinions which are likely to induce a person to take any action or position (e.g. buy, sell or hold) regarding a particular class, sector, or instrument in relation to securities or derivatives, is likely to be considered as ‘advising others concerning securities or derivatives'”.

This post has been edited by MUM: Sep 9 2023, 09:30 AM


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Yes, I am well aware of this responsibility when it comes to investment advice.
(Hence I just stay here in agency life @lifebalance @Holocene)

Regarding the insurance realm

The current situation:
When it comes to insurance purchase, the role of the intermediary as defined under the current framework is to assist consumers with purchasing a suitable plan, hence some of you have experienced agents like me asking you about your finances when purchasing an insurance policy.
Those of you who paid attention, might also see that those questions are in fact required in the application process.
In short, the job of the intermediary is to assist in the buying of a policy, and to carry out certain after sales servicing duties.

What is the trajectory of the industry?
As I mentioned, nowadays agents like myself will be asking more detailed questions on your finances. The purpose and reason behind it is the industry's push towards advisory, which is good for the industry as a whole, and good for the consumers as well. Who knows? There may well come a day that insurance agents like myself would be liable to answer to the suitability on every product sold.

That's what I know, and what I foresee moving forward.

This post has been edited by JIUHWEI: Sep 10 2023, 09:33 PM

Share la the article link

macam pointing out to someone

Tak habis habis T__T

I don't hv info on "insurance advise" that are directly as per my post.
That is why I asked.
I only found "investment advice" link as per my post.

I also found (in google) that there is a need requirement to pass some examinations like, Pre-Contract Examination for Insurance Agent - PCEIA (Part B) and and Certificate of Investment Linked Examination. and to hv license to sell insurance.

But what if no sell but only advise, suggest or recommend with the aim to influence?
Then does one need to hv a license for that?

Giving Investment advise need license,
Does giving insurance advise, suggestion or recommendation with the aim to influence, need a license too?

Does that "sell" words include the one of the definition as per Marriam Wesbter?
https://www.merriam-webster.com/dictionary/sell

Pass Pre-Contract Examination for Insurance Agent - PCEIA (Part B)
https://www.greateasternlife.com/my/en/care...-questions.html

Pass the Pre-contract Examination and Certificate of Investment Linked Examination
https://www.liam.org.my/customer_zone/?c=15&ct=2

What Constitutes Licensed Investing Advice?
Investment advice is everywhere – but not all advice is legitimate.
https://www.google.com/url?sa=t&source=web&...5rm4gJFJI7fvlt0

This post has been edited by MUM: Sep 11 2023, 07:11 AM


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No, giving advice, influence in one shape or form in matters of insurance purchase in an informal setting does not require a license.
Cuz it really doesn't make sense to "prevent" somebody or influence someone in matters of insurance purchase, unless there is something to gain from it (moral hazard).

Same goes to anything in an informal setting.
Unless the person is giving formal advice, charges for it, then lain cerita lah. Mesti kena ada lesen, because the customer is then acting on advice.

An example of an informal setting is this forum.
Kedai kopi pun informal lah

But I read in the net, ....

They said investors should be wary of discussions in social media chatrooms that may trigger securities breaches such as the provisions on investment advice or stock recommendations without a licence.

Any person found guilty may be liable to a penalty of up to 10 million ringgit or imprisonment not exceeding ten years or both, they said.

https://www.reuters.com/article/malaysia-st...s-idUSL1N2K41CK