no offense , define Too much and how unlikely to happen ? 200K n above for critical illness or medical ?

yewkhuay,

1) What kind of medical condition require medical expenditure above 200K?

How likely for this to happen?

2) What kind of Critical illness require medical expenditure above 200K?

How likely for this to happen??

Call a few hospitals if you are interested.

3) What is the premium versus coverage for below 200K versus above 200K??

If you ever shop around for medical insurance and critical insurance, you will find that premium is reasonable for coverage below 200K. Above 200K coverage, the premium grew exponentially. This is because very few people can buy that amount of insurance in Malaysia.

The problem with the rich is that below 200K, they have the money to cover that. What they need is insurance that cover a lot more that 200K. But, the premium grow exponentially for coverage above 200K.

Anyhow, this is still not a big deal for people that are very rich. Since even if they waste money on insurance, it does not matter to them.

The worst problem is with people with lower income. Some of them bought so much insurance that they have NO SAVINGS.

Dreamer

Emergency Funds
Accident/ Medical Insurance/ MRTA for Home
Investment

Life insurance is not necessary with a proper investment plan.

Many are buying a Life insurance just to get something back at the end of the day, without taking into consideration of pitiful returns.

Dear Unc Dreamer,

I am in reply to the above statement where dr2k3 mentioned about the whole tax thingy for insurance (which, i would like to emphasize, insurance in general, and not medical, life, or whatever terms there is) The scope is general which irregardless on what he is buying. My point is the saving from tax. That's all.

Secondly, what makes you think when I am giving my point of view in the good part of insurance (which I personally experienced myself in the loss of my family members and acidents that occured to me) makes you think I am an insurance agent?

dr2k3 was giving an example of spending RM6K, it's his choice, not ours. All we can go is advice him to lower down or don't buy at all. Well of course those insurance agent would be laughing his way submitting cases. RM6k annually which means RM500 per month. We all know that's a lot of money. But I believe he is just giving an example.

Rather the word INSURANCE is a taboo for you, why not have a look on other people's opinion instead?

This I would agree. Finally unc dreamer explained things in full. I personally was struggling in paying my insurance when I was jobless and my business was shaky. What's best advice is to think it over what do we really need?

Hi dreamer, May i know what is ur jobs?

I personally think that you are very free on replying threads. You should not be in management level as manager dun bother to online due to no time.

Or, you are retired person?

Btw, insurance is a must for most of the people.

Of course, those getting rm1000 salary (low income), they can not affort to buy. They priority is "everyday, dun get hungry at least"

If you have extra money, you should spent some money for insurance. But just need to have suitable and affortable insurance plan.

Insurance was exist for many many years. It have his own strengths, if not, they would stay that long.

This post has been edited by g00glesYYl: Apr 9 2008, 10:27 AM

Dyong,

Before you buy MRTA for home, you should consider buying term life insurance instead. You MAY or MAY NOT have the choice of doing that depending on how much down payment that you have.

There are MANY reason for this advice

A) MRTA pay for the house only. When someone died, you NEED CASH. If you have ONLY MRTA, the surviver MUST sell the house to get CASH. Selling a house in a short period of time get you a lousy deal.

B) With term life insurance, you get CASH. So, the surviver can decide to keep the house or sell it later. With CASH, you have the flexibility of deciding what to do (funeral, college education, living expense) and so on.

C) You can shop around for term life insurance but you must get MRTA from the bank providing loan. So, usually, you can get better deal than MRTA with the same amount of premium.

In summary, CASH is more flexible than HOUSE. So, term life insurance is better than MRTA.

<<Many are buying a Life insurance just to get something back at the end of the day>>

So, buy a term life insurance or whole life insurance with as little cash back value as possible.

Dreamer

P.S.: I am actually advising people to buy insurance. This is incredible.

---

Added on April 9, 2008, 10:38 amg00glesYYl,

<<Hi dreamer, May i know what is ur jobs?

I personally think that you are very free on replying threads. You should not be in management level as manager dun bother to online due to no time.>>

A) Personally, I think it is none of your business.

B) BTW, a good manager should never be busy. Read up on "one minute manager" if you are interested.

C) Obviously, you have never met a good manager before.

<<Btw, insurance is a must for most of the people. >>

Who cares?? The MORE RELEVANT question is

A) Do I need insurance??

B) If yes, how much and what kind?


<<If you have extra money, you should spent some money for insurance. But just need to have suitable and affortable insurance plan.>>

Which is GENERAL statement that provide NO INFORMATION to help anyone.

A) What is suitable??

B) How to calculate what is affordable?

My rule of thumb is if you CANNOT save 10% to 15% of your gross income, you are OVERSPEND.

<<Insurance was exist for many many years. It have his own strengths, if not, they would stay that long.>>

You are not OLD enough. It took average American about 15 years to figure out that whole life insurance is a waste of money and they should buy term life insurance instead. It will probably take that long or longer for Malaysians to reach that level of financial maturity.

Dreamer

This post has been edited by dreamer101: Apr 9 2008, 10:38 AM

Let's see... the main points in your reply.

1) When someone died, you NEED CASH
2) With term life insurance, you get CASH.

Nothing is certain except death and taxes
Yes, you need cash for Final expense, Tax, living expenses for your ramianing commitments.

3) better deal than MRTA with the same amount of premium
I have to look into this, might not have taken this into consideration.
Thanks for highlighting it.

4) CASH is more flexible than HOUSE
Yes, it takes time to convert assets into cash, with estate tax planning, the need for cash can be drastically reduced limited to only final expense.

I expect a scale back on the living conditions for the remaining spouse to tide over difficult times.
Probably disposing of house and living with relatives.


Side comments on :-
<<Insurance was exist for many many years. It have his own strengths, if not, they would stay that long.>>
Argumentum ad populum.
How to convince critical minds?

This post has been edited by Dyong: Apr 9 2008, 11:05 AM

dreamer,

I personally think that you should start putting yourself in people's shoe before you give any "advice". I noticed some of your replies here are so bias because you hate insurance. You're making your own assumption on a few forumers (i.e. forumers who are optimistic about insurance are insurance agents) and so I "assume" you hate insurance.

Secondly, forumers are just curious about your job and how are you able to give good "advice". What you did is you just shut them up. You might be OLD enough to give financial advices but you're lack of something which is called emphathy.

Hey dreamer101,

I'm on the same opinion with you based on your multiple previous posting advise on insurance for freshie or ppl with limited income/savings.

On the income tax reduction on 60k/yr income, that's exactly 5,000.00/mth
i.e. employer epf= rm600
employee epf = rm550

550 x 12 mth = rm6,600
which is more than the max allowed income tax reduction of 6,000.

Hence, a person does not really need the life-insurance portion to reduce their income tax if you are earning 5k/mth

------------------------------

On MRTA, my opinion is a person need to plan and view your own finance, e.g. in my case, I did not take MRTA/MLTA for my house loan, except the compulsory Fire insurance. Why ?

1) I don't see a reason spending 2-5k on MRTA. If I passed away, I have already advised all relevant to sell off the house even if it is lower by tens of thousands, settle the house and move back to parents house.

2) I don't want to pay 25-30 yrs MRTA coverage, when I know I can settle it in <15 yrs. My actual plan is <10 yrs. What's the point paying longer coverage and getting lesser rebate if I settle it earlier ? It's like I borrow 9 yrs car loan and settle it in 5 yrs, and get some rebate which is lower than the interest saved.

3) I have some personal life & medical insurance. This money can be used to settle (1) above if don't want to sell the house. The point here is I use my own insurance to settle house, instead of specific MRTA. No matter which one, both will also stuck in insurance claim processing which may take several weeks/months/years.
MRTA -> House
Life insurance PA -> House

What's the end result ? In the end, the bank offers me either:
(a) 90% financing + MRTA
(b) 80% financing without MRTA -> I took this one.

Outstanding loan balance now ? <30% now on 5th year on my actual money. <0.1% if based on total money dump in to reduce interest rate. I'm keeping this loan a/c for EPF annual lump sum withdrawal.

So, I would say it depends on how you manage your finance, put which one on higher priority, etc.

ST,

Financial planning (aka insurance as a subset) is personal.
Each and everyone of us are in unique situation and there's no one-size-fits-all solution.

The beauty of this discussion is for all to understand different views and aspects of insurance planning and strategies other employed. Hopefully you take back something after all.

End of day, You are the master of your destiny.
I've indeed learnt something with dreamer's posts.

suiteng,

A) With so MANY insurance agents running around selling insurance and others BIAS for insurance but do not know why, I provide a GOOD counter balance. Someone has to OFFER the counter point of view to balance thing out.

B) Do I REALLY hate insurance?? Does it matter?? As long as I can force people to THINK and MAKE a better decision, I have educated someone.

<<but you're lack of something which is called emphathy.>>

C) So?? There are ENOUGH nice people around that refuse to speak out. Where are them when you need someone to wake you up and make a better decision?? The world has TOO MANY nice people. One more NICE PEOPLE does not help anyone.

Dreamer

True, in the end you learn something.

But I don't honor the way of some NICE PEOPLE giving "advices" based on their own financial standings and at the same time bashing other people who are asking question in order to understand the situation BEFORE giving advices.

In some sense, playing the devil's advocate is good to promote critical thinking and also further insights/perspective into one discussion.

Something spoken by dreamer is actually quite true if one is to really analyse it with a coll mind.

We've been talking about insurance over gearing for a while now and look at how many topics regarding insurance is opened.

Like I mentioned previously, it's all about one's affordability. Final decision is still with the person. Does one really needs that sort of insurance for instances MRTA. My take on MRTA is same as cute_boboi too whereby I do not purchase MRTA because I do not see the need to it. However, I purchase yearly term insurance depending on my loan amount or when I see the needs for it. Might even stop purchasing when my loan amount gets below a certain value which is estimated to be in 5 years time.

Why term life insurance? How long would the term be? 20 years? But what happened after the 20 year?

So happens that my house is RM800K (around Puchong). My life insurance premium is RM250/mth for 20 years, that if anything happened to me I get RM500K. I dun think it is enough to cover for my house. So I added MLTA instead which I presumed it's different from MRTA, where I get to cover the house and have the additional money back to my family (if ever my mortgage principal ever reduce ) but after 20 years, when I'm around 40 plus, don't have a life insurance. So what shall I do?

Since you guys are talking about MRTA, MLTA, etc, I need some advise here.

Edit : Look at the last post.

This post has been edited by suiteng: Apr 9 2008, 12:12 PM

My advise is balance it up. From your postings, I assume you are in early 20's. I don't know your income/family background and I try not to be bias that 20's earn avg 3-6k (who knows ? you might be a high flyer earning 25k/mth)

My opinion is 800k (assume 90% loan @ 720k ) is too much for you alone, assuming you borrow a little from parents, and the rest from you. And your life insurance is 250/mth (include medical or just plain PA?) or 3k/yr, I would say it is a bit low, when you are taking a 800k risk. I would rather up the PA to 500/mth that covers 1mil than spending on MRTA.

This does not count monthly spending, renovate house, furnish the house, electrical goods, etc. which might add another 50k-250k depending on your budget. Also other expenses like car, etc.

none from parents. just a joint with me and hubby. earning varies based on how good the business is (in my part). life as in term life insurance. It's a family protection plan. Not medical. Not accident. It's pure hard cash when I die/ hubby dies( 2 different policy).

just a note...medical and accident plan are considered general insurance and has nothing to do with life. Life only covers death, TPD and critical illness. Correct me if i'm wrong.

Yes, it's all in the fine print. But who actually reads it?!....lol
I do spent some time before to read on my policy. But after all these years, forgot about the actual T&C. Need to refresh again.

wow,a lot information i get from this forum..
gt sumbody argue till wana fight ady..haha
anyway,thanks all ya!got any agent here?

Wah... asking for an agent to contact you means you have to prepare your pm box to be flooded