Debunking 5 Misconceptions about Buying Insurance in Malaysia
Certain misconceptions about insurance have swayed people from investing in their financial future.
This article aims to debunk five of the most common misconceptions about insurance. The right information will aid consumers in making informed decisions on why they should invest in insurance, which insurance plan they should choose, and how to maximise their coverage and optimise their future finances. Here’s the popular 5 misconceptions of buying an insurance plan in Malaysia.
1. Insurance is expensive
Contrary to popular belief, insurance does not have to be expensive and can be tailored to fit an individual’s budget. For example, you can get an affordable medical insurance policy in Malaysia. There are a variety of plans with varying premiums.
By understanding your needs, researching different insurance plan benefits and comparing prices, you can find the right insurance plan that fits your unique needs while being cost-effective. Keep in mind that insurance premiums vary depending on age, gender, lifestyle factors, pre-existing medical conditions and other personal circumstances. That being said, it is wise to start investing in an insurance plan from a young age for lower premiums.
A good rule of thumb is to aim to spend within 10% of your gross income on insurance premiums. Staying within budget while still getting quality coverage is possible and with an insurance policy tailored to your needs, you can have a peace of mind knowing that you are financially safeguarded in the event of a medical emergency.
2. Employer-provided coverage is sufficient
The misconception that an insurance plan from your employer is enough can be debunked when policies that are not covered by employer-provided coverage are highlighted, such as medical coverage or critical illness insurance plan. Moreover, you are only safeguarded by the company’s insurance for as long as you are employed. In the event of being laid off or quitting, you are left vulnerable. Furthermore, different companies have different coverage levels, which is depending on your seniority in the company. It is important to find out if it is sufficient to cover your financial obligations in the event of unforeseen circumstances.
Another option is to buy your own life and critical illness insurance to supplement your employer-provided coverage. Life insurance plan provides a safety net for you and your family in the event of your demise or total/permanent disability. On the other hand, critical illness insurance protects you and your family financially upon diagnosis of a critical illness. Overall, while having an insurance plan from an employer is a great start, it is not enough to adequately protect oneself against unforeseen circumstances.
3. Single individuals do not need to invest in insurance
The idea that just because someone is single means they do not require insurance, is a big misconception. On the contrary, it is actually advisable for single individuals to invest in an income protection insurance policy in Malaysia. In the event of death or permanent disability, single people are solely responsible for the payment of their debt. This could be a financial burden on them and their next-of-kin. If you have taken out a house loan, you can opt to buy mortgage insurance which is a type of credit life insurance. With this type of insurance, upon the demise of the policyholder, the insurance pays off outstanding loans directly back to the bank.
They could also opt to invest in an endowment insurance plan to protect their financial future. This investment could help them save for their retirement or other life goals. Therefore, single individuals should not overlook the importance of insurance plans to protect their finances and have a peace of mind to know that they are secure in the event of unfortunate circumstances.
4. Young people don’t need to worry about insurance till later
It is actually highly advisable for fresh graduates to start investing in insurance plans while their premiums are still low. We understand that starting salaries aren’t high, but it is more than possible to find affordable insurance policies in Malaysia that provide adequate coverage without breaking the bank.
Choosing to invest in an income protection insurance plan is a great option to ensure that you are financially safeguarded when faced with unforeseen circumstances. According to the Ministry of Health, 11.6 million of the 16 million adults in Malaysia suffer from non-communicable diseases like diabetes, hypertension, and cancer. In the event you are diagnosed with a critical illness before purchasing an insurance plan, it is too late to enjoy comprehensive coverage. Health issues can occur at any age and it is smarter to start investing in an insurance plan earlier.
5. Having savings means insurance is not needed
The last misconception that we would like to touch on is that if you have savings, you don’t need insurance. While savings can stretch you a long way, hospital stays and medical treatments like surgeries can be extremely expensive. In the event of a serious medical condition, the bills could start adding up quickly.
Besides providing financial protection against exorbitant medical bills, it also provides coverage for the loss of income due to severe disabilities. To ensure you have a financial cushion and don’t have to dig deep into your savings, opt to buy comprehensive medical insurance plans in Malaysia. Savings are great, but an additional layer of security is wise.
Conclusion
We hope that this article has helped dispel some insurance misconceptions and why it’s important for individuals of all backgrounds and circumstances to look into investing in insurance plans. Insurance plans vary in benefits, terms, and costs, but with the right research, you can find the right insurance policy that fits all your needs. If you have more questions, or are unsure of where to start, AmMetLife is here to help. Our customers are at the heart of everything we do.
