ok. i am 25 yr old.

my friend apporach me to invest in ING investment link plan. This plan include the insurance plus the investment.

She say, pay RM150 per month, you will have the coverage of
100,000 - life insurance,
100,000 - pa,
100,000 - diagnosis major illnesses.
10,000 - total & permanent disability.

then some investment income.

the first 7 yr will be partial insurance and investment, the 8th yr, all you money will go to investment. then, u can get back more money after 7 yrs, of course the investment is perform good at the first place.

They offer min 2-9% of return.

what to yo think?

my case is, if accept the offer, rm150 + rm50 (medical card). Do i over-insured?

insurance policies with "investment benefits" are most of the time, bullshit.

when the time comes u wanna get the money, they will tell u all sorts of cock n bull stories.

yes, it is true. But currently, i will having the medical card only. should not be enough.

I ask her that, if i wan the PA only, one yr is about RM700.

then i add RM1100 more, then i have more coverage and some return.

100,000 - life insurance,
100,000 - pa,
100,000 - diagnosis major illnesses.
10,000 - total & permanent disability.

are you married btw?
if you are single, i suggest maybe you can reduce
amount issured for life & major illness to around 30K-50K each
while on the other hand get a much better medical card
as we know medical expenses is gettting higher each day

to check over-insure you will need to provide info like,

how much is your salary,
how many dependants do you have,
what is your day to day activties and
what are your worries right now if any.

in principal, if this is your 1st big life policy, then you should consider a whole life plan, term life or an endowment. it provides a more consistent pay back bonus while the assurance is guaranteed.

while unit link products also provides the same protection but there is a risk if the fund does not perform well ( loose money ) then the amount you lost may eat into the protection part, fee etc ... troublesome stuff ... if it does not eat into your protection part then it plan cannot repay itself and lapse, and usually you only find out when you want to claim it ....

so even though link products is great but for a start, buy a pure insurance product first ... especially when you are not well verse with all the differences.

after said, 100K is really something MINIMUM to start with ... I cannot imagine any 'proper' insurance lower than that. So it is VERY HARD for you to over insure in this case. However, you may over pay for the same protection thao ...

here in I give you some price guidelines ....

for a 100K Life, TPD, Accident and Critical illness protection, pure protection payment starts at RM 500. So if an insurance company offers you RM 800 or more, that is common because the remaining money is used to build your bonus or extra cash benefits. If it has features like you pay 10 years and then stop where the policy pay for itselfs, then you may expect RM 1500 to RM 1800 ( like your plan now ).

on another aspect, to compare the return of a policy, use this as comparison ....

if you pay RM 1,800 for a 100k policy ( as above ), and assume the lowest guarantee return in the market ie. FD 3%, then you should get back AT LEAST ...

15K at 10th year
24K at 15th year
35K at 20th year
62K at 30th year
100k at 40th year

hope this helps a bit ....

in short, I think you should ask your agent to propose you the same plan but as a wholelife plan OR ask for a 15 or 20 years endownment plans which could fit you best ( for now ).

It depends on individual situation, like how much is your income, dependant, nature of work, family situation etc. Everyone is different so the need of insurance is different.

One of the most important issue is the income which determine how much insurance you should get. Insurance agents surely told you this is needed, that is a must to protect, blar blar etc. But if your income (left out after daily life essential) not sufficient to pay up the premium then insurance become a burden rather than protection in this situation.

So only you post some basic information, then only others can give advice. Although advice might be different due to different individual preferences, it can be a good reading or reference what should you look for.

Assume no other external factors, pls plan to buy an insurance plan as young as possible, as the premium is cheaper. Get the longest term possible... 75/85/100 yrs old plan.

My opinion:
PA : buy just enough. 50-200k. When you work, most of the time it is covered 100-500k by company. Also, you can easily purchase more PA later.

Medical: Get sufficient 50-500k, including operation, surgery, follow up treatment, etc. Also, when you work, most co also cover medical from 10k-200k. Remember inflation costs 50 yrs later.

Hospitalisation: Get a plan that covers at least RM200/day. Why ? Include inflation 50 yrs later. RM200 might just get you a general ward. And nowadays, there is a 90-10 policy. Useful when you are old/retire later. Couple of yrs later, policy may change to 80-20. Beware...

An average single/2 bed-room costs RM130+ nowadays in private hospital.

1. my salary is about 2400 - 2700 (after deduct the epf + part time allowance). Hopefully will be increase after march.

My monthly saving is like +-200 (if i pay RM200 for the insurance)

2. of course, i have parent and they are the only person that need my financial help.

3. i am doing programming and company actually but the term life and group pa for me. But i can depend on this.

4. my worries is, i have no money to buy house.

1. i think a plan within RM120-RM150/month with a good medical + hospitalisation will benifit you i guess.

2. Pls remember to ask ur agent to include the PAYOR ( continuous guranteed ) in case
touch wood, anything happen the plan will go on free for life.

3. the life & pa can reduce, because atm you alreaddy have coverage from ur company

4. Dont worry about no money buying a house, as because ur salary wont fix at RM2400 - RM2700
in couple of years i think you should be alright . . .

1. it WILL increase after March, just a matter of how much

RM200 saving is good enough. you should learn to Save First, Use Later. Basically setup a Standing Instruction from your salary bank account and deduct RM 200 to transfer to another bank account that you will not access. This is also called Automatic Millionaire approach.

2. for parent, you should calculate how much they need to substain their life. ie. how much they use every month. multiply by how long they will live, ie. pick 100 yrs old. then that is the Sum Assure you need to buy insurance for.

3. company insurance is not a permanent thing but it is very good before you do not need to buy ALL the insurance yourself. ie. company covers you for 50K sum assured, and you need 100K from #2 calculation, then you can go ahead and buy a 50K insurance. a few months before you quite your current company ( and new company do not give you any insurance), then you will need to buy another 50K insurance ....

4. make a guess when you will buy your house, ie. next year or 3 years later etc. Then set a target ie. 100K, 200K. then understand house purchase process ie. how much downpayment, getting loan etc. then calculate if interest is 3% like FD, how much you need to save. if earning 5-8% interest, how much you need to save etc.

insurance plan, the most important aspect is the total disablement benefits.

let say, u earn RM 3 K. annual means RM 36k.

if one day u are struck down by accident or sickness that cause u cannot work anymore, u going to lose ur monthly income.

get a plan that cover that, for maybe 5 years ?

36K x 5 = ? u can do the calculation.

i notice the disable benefits is like RM 10K. so little. how long u can last with it ?

and the critical illness, there are one condition hidden there usually.

gosh, i hope u haven't signed anything, ur plan is Under-explained. where the hell in this world on 8th yr all ur money go to investment only. and at ur age u can get more protection with 150/m in similiar plan WITH medical card.

and the return is not OFFERED , is PROJECTED.

1-7 yrs, the money to cover the insurance plus investment.

most money got to insurance, so, the money i can get back is very less. After 7 yrs, then u can see the return is more.

i am very lazy to make any comparison liao. So, i think i will take this offer.

g00glesYYl,

<<i am very lazy to make any comparison liao. So, i think i will take this offer.>>

1) You WORK so hard for your money. But, you are TOO LAZY to make sure that you do not WASTE your money. Where is the logic here?? This is a HUGE commitment across many years.

2) Insurance is NOT savings. If you cannot save at least 10% to 15% of your gross income after paying insurance, you are buying TOO MUCH insurance.

Dreamer

haha. correct. u have the point and i understand.

but human is like this.

Wrong, it is LAZY individual that will act like that.

Cheers

This post has been edited by Kayne: Feb 28 2008, 10:47 AM

Kayne,

No. Stupid individual. If a person going to waste their money away, why work hard for money to begin with?

"Stupid is as stupid does"
Forrest Gump

Dreamer

dude, so sad to hear u say tht , a waste of our time then. my 2cents : ask in detail b4 u commit to any life long plan... u do understand wat u get back is very little, but just make sure ur Money got u wat u r supposed to get not what wat is proposed by agent.


p/s : not trying to sell u anything but feeding u with money , ur own hard earn money.

Reduce ur basic sum assured to 50k plus a medical card. 150/month can do the job

I have written article on how investment link works. Perhaps you can go read from my blog - www.jeanchai.wordpress.com

RM 150 is good for the coverage offer. But if your investment is not performance, then perhaps you might have to top up your premium (no joke, it happened to my husband).