Quarterly Market Outlook
When managing your wealth, three crucial components are taken into consideration: savings, investment and protection. While the first two components are often discussed, protection is just as important, especially if you are the main breadwinner in the family. Here’s where a good insurance plan will benefit you and ensure your legacy continues.
Insurance is an integral part of solid financial planning. It gives you and your family financial protection and assurance in case of sickness or death. It also gives you peace of mind, knowing your loved ones will be taken care of no matter what happens.
It’s almost automatic that we insure our assets such as our property, but why are people less keen on insuring themselves and their loved ones?
According to Life Insurance Association Malaysia (LIAM) only 12.6 million Malaysians have life insurance coverage. Based on LIAM’s Protection Gap Study, Malaysian households are substantially underinsured. A family of five would need at least RM350,000 to cover their living expenses over the next five years in the event of a loss of the breadwinner.
A Life insurance is one of the simplest ways to ensure that your loved ones are adequately provided for. Accidents and illnesses can’t be predicted, and having life insurance can protect the majority of your income if you suddenly are unable to work.
The death of a loved one is a stressful, unpleasant experience that is financially, emotionally, and physically draining on those it affects. However, an adequate life insurance policy can ease the financial burden. Your loved ones won’t be saddled with a pile of bills and your nominee(s) will receive your payout according to your wishes in the shortest possible time.
Insurance and life go hand in hand. It’s never too late – or too early – to start planning ahead. Having the right insurance plan can help you, no matter what stage of life you’re in, or what you do for a living.
There is always a plan that is just right for you and won’t cost an arm and a leg. Here’s how insurance can help you and your loved ones:
Insurance can help build a nest egg for retirement or make the down payment for a house. It can also provide assurance and medical coverage should you suddenly lose your job or become unable to work. When you retire, you are certain of an income to cover your needs. You may also purchase insurance for your parents to provide them with an income and protection in their golden years.
By the time you are 55, the amount in your EPF fund may not be enough to cover your daily expenses after retirement, not to mention any additional costs like family vacations or helping your child buy their first home.
In case of death/disability of the breadwinning spouse, insurance can provide an income and medical coverage.
Premiums are more expensive at this age, but there is no reason why you can’t start preparing, especially if you have started a family.
Prepare for the kids’ futures and education and provide assurance for family members in case of disability or death of the main breadwinner.
Insurance can ensure cashflow for your business in the event of your death or permanent disability while the succession plan is being implemented.
Your bank can help you get started on your path to protection. There are several benefits to getting insurance through your bank (bancassurance).
Your Relationship Manager can provide consulting based on your specific needs, risk profile and goals. This makes your experience hassle-free.
It can be overwhelming when you have so many choices and so much fine print to read. Your Relationship Manager is a trusted source who has a deep understanding of all the options available from a variety of insurance providers and they will advise you on the best product for your needs.
It’s much easier to meet with your Relationship Manager to arrange for renewals or consult on any changes. Claims via your bank are also processed faster due to the bank’s ready access to data and documentation.
Since your bank is already connected to the insurance company, you can opt for a secure and easy auto-debit payment.
Your Relationship Manager can also help you go through your existing plan to determine if it suits your current needs and is worth the premium. They can also help spot overlaps in your coverage that may hinder claims.
While some might be tempted to go for the cheapest premium, you should opt for a plan that brings the most value. You can consider a plan that allows you to increase your premiums as your needs evolve and you move up in your career.
A premium is a monthly commitment, so you may need to make minor adjustments to your daily spending habits to accommodate this.
An easy example would be cutting down on your daily cuppa from the café (which can easily cost RM15), and bringing freshly brewed coffee from home instead. That would allow you to meet a RM300 monthly premium, and you get as much coffee as you can drink.
If you haven’t been to the gym in a while, use that membership money for your premium. For exercise, head to the public parks and follow a home workout plan. You can walk that short distance to the shops instead of driving and get those 10,000 daily steps in.
Another way to decide how much you want to spend for your premium is to set aside 5%-10% of your monthly income for insurance premiums. Use this amount to discuss with your adviser on which plan will give you the most value.
A bonus to getting coverage is tax-deductible premiums. For 2019 tax filings, the annual limit for life insurance is RM7,000, while for medical insurance or education benefits, the annual limit is RM3,000 (not through salary deduction).
Talk to your Relationship Manager to find out more about how to protect yourself and your loved ones with RHB Life Protection Plan.
Visit your nearest RHB branch, or contact us at 03-9206 1188.
To help its policy holders during this challenging time, Tokio Marine Life Insurance Malaysia (TMLM) has set up a special RM1 million Financial Support Fund, replacing and improving upon the initial Special Compassionate Benefit.
The Financial Support Fund provides the following benefits:
A special lump sum Compassionate Benefit of RM10,000 payable to policy holders and their immediate family members (parents, spouse and children aged 21 and below) in the event of a death due to Covid-19.
An additional RM10,000 will be payable if the individual is front-line medical staff registered with the Ministry of Health Malaysia (MOH) and is employed by a hospital in Malaysia.
Daily Hospital Admission support of RM250 per day (maximum 30 days) payable to the policy holder should they test positive for Covid-19 and are quarantined in a hospital designated by the MOH. This support amount is valid provided the date of admission is after 14 days from the date the policy is issued or reinstated.
Existing Medical Card coverage will be extended to claims related to Covid-19, subject to terms and conditions of the plan.
To enable TMLM to assist as many Malaysians as possible, each policy holder is entitled to one claim only, regardless of the number of policies held.
The RM1 million Financial Support Fund is offered from 20 March, 2020 to 31 December, 2020. For more information, please contact TMLM Customer Care Hotline for more at 03-2603 3999.
1Life Insurance Association Malaysia (LIAM) Annual Report 2019, Performance of the Life Insurance Industry, referring to Underinsurance Study in Malaysia, by LIAM and Universiti Kebangsaan Malaysia, December 2013.
Secure the future of your loved ones and peace of mind.
Get in touch with RHB Premier today.
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