What are some of the insurance plans you should consider having?

We all know by now how important it is having protection in terms of insurance coverage. But are we covered for the right risks? There are so many options out there it can be confusing to decide what’s right. And with agents telling you you need all of them in order to really protect yourself and those you love really does not make matters easier does it?

So are you one of those who know that you absolutely need an insurance policy (or two) but don’t exactly know which one(s) to get? Good news! We are here to help make your life just a little bit easier by listing some of the most important ones that you should consider purchasing.

Below are the insurance plans based on priority and importance. However, do take note that this is a suggestion based on general needs but since insurance is largely personal, this means that individual needs is different so you should still carry out some research before going insurance shopping. So let’s start:

Drum roll please…

1. Medical and Health Insurance

Why do we think medical and health insurance is the most basic cover that everyone should have? Well firstly, illness, injury and accident can happen to anyone, at anytime. And secondly, medical expenses these days can cost a fortune, especially if treatment is required for an extended period of time.

I am sure many among us know of someone who has a heart condition or has even had a heart bypass done. Did you know that a single bypass surgery costs over RM 40,000 in Malaysia? This does not even include other related expenses including hospitalisation, consultation and follow up treatment. This can be quite a hefty sum to pay if you don’t have the money ready in your savings account. Many have been caught unprepared and resorted into selling their assets and properties.

Don’t think this concerns you as you are young and living a healthy lifestyle? Well consider this. Diseases such as cancer knows no boundaries, not age, gender nor lifestyle.
A study conducted last year showed that 45% of cancer patients suffered from financial catastrophe one year after diagnosis, while 11% did not make it past the first year. Other findings are as follows:

• 46% of cancer patients had used up their personal savings
• 39% could not pay for medication
• 35% could not pay for medical consultation fees or tests
• 22% could not pay for rent or mortgage
• 19% had to discontinue treatment

These numbers alone should be reason enough to make Medical and Health Insurance your top priority when deciding a coverage. When choosing a plan, understand the different types of policies available and find one that best suit your budget, needs and family medical history. If you are employed and your company offers a health plan for its employees, find out what are the coverage and if it is necessary for you to get additional plan as a supplement.

 

2. Motor Insurance

In Malaysia, like it or not, you are required to purchase a minimum Third Party cover for your vehicle. Third Party is the most basic of the three types of Auto Insurance policies that you can get in Malaysia. So this means that you can still choose to purchase another plan should you want a more extensive coverage.

The 3 types of plans are:

(A) Third party plan – basic coverage: covers death or injury to third party and lost or damage of third party’s properties only

(B) Third party, fire and theft plan – covers (A) plus loss or damage to your own vehicle due to fire and theft

(C) Comprehensive plan – covers (A) and (B) plus loss or damage to your own vehicle due to accident

You might be asking, “wait a minute, what about me?”. That is correct, these policies do not cover your own injury or death due to automobile accidents. See why we think Medical and Health insurance is important? Back to point number 1 you go.

 

3. Houseowners and Householders Insurance

Your house is probably going to be the biggest investment you will ever make in your life, so we advise you to protect it the best way you can – with an insurance cover. The basic plan that you can purchase to protect your house is the Fire Insurance policy. In Malaysia, if you purchased a house with a bank loan, the bank will make it compulsory for you to acquire a Fire Insurance for the said property. This policy compensates you for loss or damage to your property due to fire, lightning and explosion and it covers the cost for reconstruction, replacement and repair.

There are other plans and/or extension that you can opt for apart from the basic Fire Insurance plan. This may include damages caused by other perils such as flood, subsidence and riot.

 

4. Life Insurance

Not everyone needs a Life Insurance policy, as we have covered in our previous article “So You Think You Need a Life Insurance Policy?”. But if you happen to be someone who does need it, you should make it one of the top priorities in your life. Don’t wait till you are 50 or have been diagnosed with an illness to get one. Buying life insurance while you are still young and healthy means paying a lower premium price since you are considered low risk by the insurance companies which in turn means you save on thousands of ringgit.