What you Need to Know about AIA Public Takaful

 

AIA Public Takaful provides Shariah-compliant insurance products for its Muslim and other interested clients. It was formed as a joint venture of AIA Co Ltd(AIA), Public Bank Berhad(PBB), and Public Islamic Berhad on March 2011.

The company distributes its family Takaful products in Malaysia through its 17,000 insurance agents (known as Life Planners) and also through Public Bank’s branches.

It offers protection, savings, education, and investment Takaful products, and also provides investment advisory and wealth management services.

What is Takaful and how does it Work?

Takaful is a type of Islamic insurance where members contribute money into a mutual pool system so as to protect each other against loss or damages. Takaful insurance products were introduced as an option to commercial insurance which was seen to infringe on Islamic principles that are against interests, and gambling.

The Takaful fund is operated and managed by a Takaful operator on behalf of the participants and charges a set fee for operation costs. The claims from the participants are paid from the Takaful fund and the surplus is determined and declared once a year by the Takaful Operator. If there is any surplus left after all the costs have been deducted, it is then shared between the Takaful Operator and the eligible participants at 50:50 ratio. Each participant will get the share in accordance with their actual Tabarru allocation.

AIA Public Takaful Products

  • Life Protection
  • Medical Protection
  • Critical Illness Protection
  • Savings and Investment
  • Accident Protection

Life Protection Takaful

There are a number of life protection takaful products that are designed to fit different individual clients. The plans vary in terms of the coverage period, entry age, protection level, and benefits. The various Life protection options at AIA Public Takaful include:

A-Life Fleksi which allows you to protect your loved ones and invest at the same time. With this plan, you will get protection on death and Total and Permanent Disablement and also invest to grow your money at the same time.

 A-Life Signature-i&A-Life Signature-i PlusOne is also flexible investment-linked plans that allow you to protect the lifestyle of your loved ones when you are no longer there. Your family gets a payout of 200% of your coverage amount if you die from an accident or 300% if the accident happens in public transportation.

A-Plus Payor i & A-Plus PayorCI-i, ensure that your children are well taken care of when you are no longer around. It covers children of up to 25 years and makes sure that their future is protected in case you die or suffer a critical illness.

A-Plus Disability Cash-i offers you protection if you are unable to work due to a disability. If you become totally and permanently disabled before the age of 70 years, you will receive an annual payment up until you reach 75 years.

A-LifeLink-i also offers a flexible investment-linked plan that allows you to invest and protect your loved ones at the same time.

A-Plus Hajj is a uniquely designed add-on plan meant to complement the A-LifeLink-i Plan. It offers you protection should anything happen to you during your Hajj or Umrah.

A-Life Kasih Famili is a plan that is designed to protect the needs of your family who will receive the basic coverage amount if you pass away.

AIA i-Starter Plan is a simple one year plan that provides financial security to your family in case of your demise. It is available to anyone between the ages of 16- 55 years. You can choose a coverage option from RM10, 000 to RM30, 000. Your loved ones will get 100% of the coverage amount if you pass away during the certificate’s term.

Medical Protection Takaful

AIA has various options of medical takaful products that their client can choose from depending on their needs. These include:

A-Plus Health-i which is a comprehensive medical plan that provides you with coverage up until you reach the age of 100 years. The plan will also reward you for staying healthy.

A-Life Medik Famili takes care of you and your family’s medical needs and there is no limit on how much you can claim each year and in a lifetime.

A-Plus Med-i is a comprehensive medical plan that has an increasing annual limit. It offers you lifelong protection up to the age of 100 years.

A-Plus Med Booster-i complements A-Plus Med-i to increase your medical level coverage and help you cope with the ever-increasing medical costs.

A-Plus Hospital Income Extra-i provides you with a daily income while you are hospitalized due to an injury or an illness.

A-Plus Baby Care-i is an optional rider that you can use to increase protection during pregnancy and the baby’s early years. The plan covers the baby until the age of 5 years.

Critical Illness Takaful Protection

Under Critical illness protection, AIA Public Takaful offers several plans which include:

A-Life Cancer360-i which offers complete cancer protection from early to advanced stages. It provides coverage up to when you are 80 years old.

A-Plus Critical Care-i provides financial support for you and your loved ones while you are undergoing treatment.

A-Life Lady360-i is a comprehensive plan designed to provide protection for women.

A Plus Waiver-i ensures you enjoy the protection of your Takaful certificate without making any further contribution if you get diagnosed with a critical illness.

A-Plus Junior Critical Care-i offers you financial support coverage if your child gets diagnosed with a juvenile-specific critical illness

A-Plus Venuz-i &A-Plus Venuz Extra-i provides coverage for women. It offers financial support that you need if you get diagnosed with a critical illness. A-Plus Venuz Extra-i offers more coverage during pregnancy.

Savings and Investments Takaful

AIA Public Takaful only offers one option in their savings and Investments plan. A- EnrichGold-i plan is a short-pay savings plan that offers takaful coverage and provides potential growth to your investment. The entry age of this product is 14 days to 65 years and the coverage is of up to 35 years. With this product, you can choose the payment terms that you are comfortable with e.g. pay for 10 years to get 25 years protection or you can pay for 20 years to get 30 years of protection.

Accident Protection Takaful

When it comes to protection against accidents, AIA Public Takaful offers a product called A-Plus Accident Shield-i & A-Plus Total Accident Shield-i that are designed to boost your coverage against accidents. These products cover you until you are 70 years and allow the entry age of 16-60 years of age. The benefits to be enjoyed through this product include Accidental Death Benefit, Accidental Dismemberment Benefit, Total and Permanent Disability Benefit. A-Plus Total Accident Shield-i will also offer you some weekly allowances if you suffer from a temporary disability.

How to Make a Claim

To make a claim, you can download the claim form on AIA website aia.com.my. Complete filling the form, and make sure that you include your bank information, which is where you approved claim will be deposited via e-payment. Submit the claim form and supporting documents at any of AIA Customer Centers.

You can follow up on your claim progress by visiting any of their customer support centers or by registering as a user of AIA customer portal MY AIA.

Conclusion

If you want to protect your family and yourself against life’s uncertainties but you are not comfortable with normal insurance, you have an option of shariah law compliant takaful products that you can choose from. These products are not only reserved for Muslim clients but are available to anyone interested.

Why you Need Travel Insurance and the Best 10 Travel Insurance Products in Malaysia

Whether you are traveling to a beach in some exotic country, or just going to visit your family in another city; whatever the case may be, traveling has its own risks. These risks include lost or damaged luggage, delayed or canceled flights, injuries or illnesses, and even death. You can never be too sure of what you may find on the other end of your journey. And, this is where travel insurance comes in.

 

What is Travel Insurance?

Travel insurance provides you with some sought of a cushion against travel-related risks. It covers you and your family against injuries, illnesses, permanent disability, death, loss, and damage of luggage and other incidences that may occur while traveling. Most Travel Insurance policies offer you a one-off coverage where you pay for coverage for one particular trip with a fixed timeframe. But, you can also get annual coverage if you are a frequent traveler.

 

Different Types of Travel Insurance in Malaysia

Single Trip
This is a short-term travel policy that covers you for one particular trip usually from and to Malaysia for a specific period of time. It is most popular for people that travel once in a while. It covers you for more than 90 days while on that trip.

The coverage in this plan includes accidental death, permanent disablement, medical expenses, follow-up treatment, emergency medical evacuation and repatriation, compassionate visitation, and child care.

Annual Cover
This is designed to suit people who are constantly traveling mostly for work. It covers you for an unlimited number of trips in one year.

This plan offers personal accident cover, medical expenses, hospital allowance, emergency medical evacuation and repatriation, and also child education fund.

Individual Plan
As the name suggests, this plan covers one individual person, usually the policyholder. It covers medical expenses, emergency medical repatriation, accidental death, and total & permanent disablement.

Family Plan
This is a plan for families that like to travel together. It covers the policyholder, spouse, and children below 18 years. Some policies put a limit to the number of children covered in this plan. It covers personal accident & death, medical expenses, alternative medicine, childcare, and compassionate care.

Islamic Travel Insurance
It is commonly referred to as Takaful in Malaysia. This kind of insurance is Shariah-compliant and offers coverage against accidental death, total & permanent disability, as well as loss or damage caused by acts of terrorism, and medical expenses.

Backpackers Travel Insurance
This is designed for the adventure seekers in Malaysia. It offers coverage against personal accident, personal liability, gear protection, and extreme sports activities.

Student Travel Insurance
This plan is designed for students who study overseas to help them in their educational pursuits. It offers personal accident covers, tuition fee reimbursement, and sponsor protection.

Business Traveler Insurance
This plan ensures that you are covered when you travel out for business. This business-oriented travel insurance offers coverage on emergency medical evacuation and repatriation, baggage loss/damage/delay, travel cancellation/ delay, and emergency travel assistance services.

 

How Much Does Travel Insurance Cost in Malaysia?

Contrary to popular belief, travel insurance is not that expensive. Considering the amount of coverage and the risks involved, it is always wise to put some extra cash in protecting yourself and your family while out on vacation. There are several factors that determine the amount of premium you will pay for a travel Insurance cover. These include:

  • Duration of the trip

This is an important factor that influences how much premium you will pay. Instead of charging by the individual number of days, most travel insurance companies in Malaysia calculate the days in duration blocks such as 1-5 days, 6-10 days, 11-15 days, and so on up to 30 days.  Some policies last up to 30 days but others can extend in successive one-week blocks.

But, if you are constantly traveling for work or other reasons, it is always advisable to take a policy that covers you for a whole year. This is cost-effective compared to the impromptu policy that you have to purchase ahead of every trip.

  • Domestic or International Travel Insurance

Whether you are traveling to Singapore, Hawai, Paris, or Penang, will definitely affect how much premium you are going to pay. Domestic travel insurance covers all travels within Malaysia, while international coverage covers various countries outside Malaysia. Some travel insurance companies usually divide international countries into regions of coverage depending on their geographical location. For instance, a company may consider countries within Asia as region A, while the rest to be region B. Obviously, region B coverage will be a bit more expensive than region A.

Additionally, travel insurance companies may offer around the world travel coverage package, but, this does not include travels to countries that are considered as high risk due to political or social instability.

  • Individual or Family Travel Insurance

Travel Insurance companies in Malaysia mostly divide their packages into two distinct categories- Individual and Family. These two packages are then priced differently with the family package obviously being a bit costly. The individual package covers a single person above the age of 18 years, while the family package is designed to offer coverage for the individual, spouse and/or children.

What does Travel Insurance cover me for?

  • Accidental Death or Permanent Disablement

If during your trip, you get into an accident and become permanently disabled or maybe die, your travel insurance company will pay a lump sum to you or your beneficiary according to the benefits of your policy plan.

The policy may also cover the cost of repatriation of your body to the country if you die in another country.

  • Hospitalization and Medical Expenses due to an illness or an accident

In case you get a medical emergency while you are on your trip, your travel insurance policy will cover all your medical expenses. However, you will probably have to foot the medical expenses first then claim for compensation later when you return home. There are those policies that cover the cost upfront but they are usually more expensive.

  • Loss/Damage of Luggage and Personal Items

These include loss or damage of your luggage, loss of passport or money etc. Your travel insurance policy caters for all the inconvenience you experience while you are supposed to be enjoying your trip.

  • Trip Cancellation/Delay

If you have to cancel or delay your flight due to an illness, accident or for any sudden and unavoidable reason that is of no fault to you, your travel insurance policy will cater for the extra expenses that may arise due to the cancellation or delay. You will, however, be required to provide proof showing that there was no other choice.

Some policies may also cover if your flight is interrupted for more than 12 hours due to a hijacking.

 

What does Travel Insurance Policy not cover?

Most travel insurance plans have a number of exclusions that they do not cover. These exclusions differ from one company to the other. However, some of the most common exclusions include:

  • War risks
  • Riots
  • Suicides or insanity
  • Alcohol and drug abuse
  • HIV/AIDS-related ailments
  • Provoked assault and murder
  • Hazardous sports
  • Damage or loss of luggage due to customs regulations
  • Childbirth or miscarriage
  • Radiation
  • Pre-existing medical condition

It is always better to read and understand the exclusions before you commit yourself to buy any travel insurance plan.

 

How to make a Claim

In case of an incident, contact the emergency assistance hotline of your insurer: some travel companies offer 24-hour emergency assistance services whereby they provide access to assistance on medical advice, referrals, medical evacuation, and travel-related situations like loss of luggage or passport.

Make sure that you notify the authorities for any loss or damage to your belongings so that measures can be taken to protect, save or recover them.

Also, submit your claim form to your insurer accompanied by all the supporting documents such as the original policy, the medical report, the police report, and any other relevant document as soon as possible. You can check the time stipulated for claim notification in your policy document.

Documents needed to make a Travel Insurance Claim are:

  • Original ID or Passport
  • Completed claim form
  • Travel itinerary and flight tickets
  • Complete baggage information
  • Medical documents and doctors report(if necessary)
  • Police report
  • Essential bills, invoices, and receipts
  • Relevant notification from your airline

 

Top Ten Travel Insurance Products in Malaysia

Company Product Medical Expenses Loss/Damage to Luggage
Allianz

 

Travel Care Up to RM 1,500,000 Up to RM 15,000
Etiqa

 

Tripcare 360 Takaful Up to RM1,500,000 UP to RM 12,500
AXA Afin

 

Smart Traveller Up to RM 900,000 Up to RM 22,500
Tune Insurance

 

Travel Easy Up to RM 300,000 Up to RM 5000
Tokyo Marine

 

Travel Partner Up to RM 900,000 Up to RM 15,000
Berjaya Sompo

 

Travel Care Up to RM 350,000 Up to RM 5,000
Etiqa

 

Tripcare 360 Up to RM 1,500,000 Up to RM 12,500
Pacific Insurance

 

Travel Pro Domestic Up to RM 75,000 Up to RM 3,000
MSIG Malaysia

 

TravelRight plus Up to RM 400,000 Up to RM 7,500
AIG Insurance Malaysia

 

Deluxe Up to RM1,000,000 Up to RM 15,000

 

Conclusion

When choosing travel insurance, don’t just go for the one with cheap premiums, but, make sure that the product you choose provides great coverage. Also, take your time to go through the exclusion list so as to avoid any frustration when you go to claim and it is denied.

Great Eastern Life Assurance Malaysia Plans & Product Review

Founded in 1908 with its headquarters in Singapore, Great Eastern Life Assurance Company Limited works as a subsidiary of Great Eastern Holdings Limited and has over 21 branch offices in Malaysia.

It is the oldest and most established life insurance company in Singapore and Malaysia. It is also present in Indonesia, Vietnam, Brunei, and has a joint venture in China. It offers financial solutions to individuals (personal insurance) and corporate solutions (employee benefits and business solutions).

Needless to say, Life insurance is the best selling insurance product at Great Eastern Life Assurance Company.

Great Eastern Life Protection
Great Eastern Life Assurance provides a wide array of flexible and tailored solutions that suit different individual’s needs at various stages of life. Here is a list of these products and some of their benefit:

  • Great 110 Legacy
  • Great Cherish 80
  • Great Early Vantage Care 2
  • Great Maxi Protector
  • Great Term Direct
  • Great Vantage Care 2
  • Smart Legacy
  • Smart Legacy Max
  • Smart Protect Essential
  • Smart Protect Max

Great 110 Legacy
This is a non-participating endowment plan that matures at age 80 years or after 30 policy years. The premiums are payable until the plan matures or termination of the policy.

Benefits

  • Offers double protection against death or total/permanent disability.
  • Provides up to 4 times Basic Sum Assured for accidental death prior to 70 years policy anniversary.
  • There is a guaranteed survival benefit payable at the end of ten years, until death or surrender of the policy.
  • Optional riders to enhance your protection.

Maturity of Product: at age 80 years or after 30 policy years- whichever come later

Product Link: Great 110 Legacy

 

Great Cherish 80
This is a non-participating plan where premiums are paid until the maturity of the plan or upon death. The product allows you to plan ahead for your future and your family’s financial goals.

Benefits

  • The application is hustle free. There is no need for medical examination or health reports
  • Guaranteed maturity money back benefits of 108% at age 80 years policy anniversary
  • Death benefit payable to your loved ones based on the policy year the death occurs
  • In case of accidental death, your loved ones receive an additional percentage of Basic Sum Assured in addition to the death benefit.

Maturity Period: at age 80 years

Product Link: Great Cherish 80

 

Great Early VantageCare 2
This is a participating whole life living insurance plan with no guaranteed bonuses. The premiums in this plan are paid until age 87 years or upon termination of the policy. The plan matures at age 87 years, next birthday.

Benefits

  • Allows you to make multiple claims for various critical illnesses, or across severity stages of the same illness
  • It has a death and total /permanent disability benefit where your loved ones will receive the Basic Sum Assured, Additional Sum Assured Cash Bonus, plus Terminal Bonus.
  • You can buy back the death benefit portion up to your Basic Sum Assured (BSA) if your policy gets terminated because of a critical illness claim.
  • Upon maturity of the policy, you will receive a lump sum payment of your BSA, Cash Bonus, and Terminal Bonus minus any amount you might have claimed earlier.
  • There are Additional Sum Assured which is payable in the occurrence of a critical illness or death.

Maturity Period: Age 87 years, next birthday.

Product Link: Great Early VantageCare 2

 

Great Maxi Protector
This is a non-participating whole life policy with premiums payable until the age of 87 years or upon death or TPD. The plan matures at the age of 99 years.

Benefits

  • Offers affordable lifetime protection for you and your loved ones
  • It ensures that your loved ones are financially taken care of by paying a lump sum of the basic sum assured upon your death.
  • If Total/Permanent Disability (TPD) occurs before the age of 65 years, the basic sum assured will be paid to help meet your financial obligations.
  • Basic Sum Assured is payable upon maturity of the policy
  • You can add supplementary benefits/riders to increase your protection.

The maturity of policy: Age 99 years

Product Link: Great Maxi Protector

 

Great Term Direct
This is a non-participating term plan that offers guaranteed renewal until age 80 years.

Benefits

  • Protection until the age of 80 years
  • Upon your demise, your loved ones will receive the first RM5,000 of the basic sum assured
  • Death benefits where the remaining sum assured is given to your loved ones
  • If TPD occurs before the age of 65 years, you will receive the basic sum assured

Maturity of Policy: Until age 80 years

Product Link: Great Term Direct

 

Smart Legacy
This is a regular premium investment-linked insurance plan that is tied to the performance of underlying assets. The premiums are paid for the whole policy term or until death, TPD, or termination of the policy.

Benefits

  • It gives you protection with a managed unit fund with life coverage
  • An additional 1% of the basic sum assured is provided every policy year up to 30%
  • A booster reward of 12% basic sum assured is credited into your Total Investment Value
  • High protection coverage against death or TPD starting from RM500,000
  • Additional protection against accidental death which occurs before you have attained 70 years
  • There is a “No-Lapse Guarantee” in the first 3 years of the policy provided the premiums are paid consistently and there are no withdrawals made in the first 3 years
  • You can boost your protection with optional additional riders

Maturity of Policy: attained age 70 years next birthday/ 30 policy years

Product Link: Smart Legacy

 

Summary
Before purchasing any life protection product, make sure that it meets your needs and that you can comfortably afford the premiums. Great Eastern Life Assurance gives a 15 days free-look period to review the product and determine if it is best for you. In case you return the policy during this period, you will receive your full premium refund minus any expenses incurred for medical examination.

Best 10 Medical Protection Plans AIA Malaysia Offers!

AIA Malaysia Medical Insurance Review

AIA Group Limited is the leading life insurance group which has been offering insurance and financial services, accident and health insurance, retirement planning, general insurance, mortgage, and family takaful products to millions of customers in the Asia-Pacific region for over 90 years. It is present in 18 markets across the Asia-Pacific including Malaysia, with its headquarter being in HongKong.

AIA Medical Card

AIA has several medical protection plans with different benefits and coverage which customers can choose from according to their needs and financial strength. These plans include:

  • A-Plus Health,
  • A-Life Medik Famili,
  • A-Plus Med Booster,
  • A-Plus Med Booster- i
  • A-Life Med Regular
  • A-Plus Med
  • A-Plus Med-i
  • A-Plus HospitalIncome & A-Plus HospitalIncome Extra
  • A-Plus HospitalIncome Extra-i
  • A-Plus Babycare-i
  • A-Plus Babycare

AIA A-Plus Health

This is a comprehensive health plan that offers a complete medical coverage for your whole healthcare journey.

Coverage Period: Up to 100 years old

Entry Age: 14 days to 70 years old

Link to the product: A-Plus Health

Features

  • A comprehensive medical protection where your medical expenses were taken care of up to the age of 100 years old.
  • A health wallet where you will receive rewards for every year you go without making a claim. You will also receive some additional benefits illness prevention, extra coverage for 3 top critical illnesses, and medical equipment for mobility and hearing in case of disability.
  • You can also reduce your premium payments by choosing a deductible amount of RM300. This amount is, however, only available for In-Patient services.
  • There are also some Health Rewards which you will receive for staying healthy. These will include waivers on deductible amounts upon admission, upgrade to your room and board limit, or a boost to your Health Wallet.

A-Life Medik Famili

This medical plan is quite affordable and takes care of you and your family’s medical needs.

Coverage Period: Up to 100years old

Entry Age: 14days to 70 years old

Link to the product: A-Life Medik Famili

Features:

  • You can extend the coverage to your spouse and children with the Family Plan
  • You receive medical protection until you are 100 years
  • There is no set limit on how much you can claim in a lifetime
  • Any excess from the Takaful Risk Fund at the end of every year is shared equally with the eligible participants.

A-Plus Med Booster

This is a medical protection that compliments A-Plus Med and A-Life Med Regular to help boost your medical coverage.

Coverage Period: Up to 100 years old

Entry Age: 14 days to 70 years old

Link: A-Plus Med Booster

Features:

  • A high annual limit of medical protection of up to RM 1.5 Million.  
  • There is no limit to your lifetime claim.
  • There is an option of up to six medical plans to choose from.
  • In the first 10 years of your plan, your room and board limit may increase by 20% every two years.
  • You receive a double lifetime limit for outpatient cancer treatment and kidney dialysis of A-Plus Med and A-life Med Regular.
  • In case you get hospitalized or treatment in Singapore, you will receive reimbursement for the cost you incur while converting to local currency.
  • You also get reimbursement for your out-patient treatment for dengue fever.

A-Plus Med Booster-i(Takaful)

This health plan compliments A-Plus Med-i to increase your medical coverage.

Coverage Period: Up to 100 years old

Entry Age: 14 days-70 years old

Product link: A-Plus Med Booster-i

Features:

  • Has an annual high limit of up to RM 1.5 Million of medical protection.
  • Have six different medical options to choose from.
  • There is no lifetime claim limit.
  • For the first 10 years of your plan, your hospital room and board limit may increase for up to 20% every two years.
  • You also get a double lifetime limit for outpatient cancer treatment and kidney dialysis of A-Plus Med-i.
  • You will get reimbursement for your treatment of dengue fever.
  • In case you receive treatment or get hospitalized in Singapore, you shall receive reimbursement for the cost incurred in converting to local currency.   

A-Life Med Regular

This health plan has no lifetime limit and helps to cover you and your entire family’s medical needs.

Coverage Period: Up to 100 years old

Entry Age: 14 days-70 years old

Product Link: A-Life Med Regular

Features:

  • Life-long medical protection until you reaches the age of 100 years old.
  • There is no limit to how much you claim in a lifetime.
  • There is an option of three coverage plans to choose from according to your needs.
  • You will not pay for any portion of your treatment charges
  • You can also include your spouse and children to your plan.

A-Plus Med

This is a comprehensive health plan with an increasing annual limit.

Coverage Period: Up to 100 years

Entry Age: 14 days to 70 years old

Product Link: A-Plus Med

Features:

  • Medical protection until the age of 100 years.
  • Increasing the annual limit for the first 20 years of your plan every two years.
  • There is no limit to how much you claim in a lifetime.
  • Seven plans to choose from according to your needs.
  • You will not pay any part of your medical expenses.
  • You can include your children and spouse to your plan.

A-Plus Med-i (Takaful)

This is also a comprehensive medical plan that offers an increasing annual limit.

Coverage Period: Up to 100 years old

Entry Age: 14 days to 70 years Old

Product Link: A-Plus Med-i

Features:

  • Medical protection until you are 100 years old.
  • No limit to how much you can claim in a lifetime.
  • Increasing the annual limit for the first 20 years of your plan every two years.
  • Seven coverage plans to choose from according to your needs.
  • No co-takaful or deductible charges
  • A medical card that offers you easy admission to over 98 hospitals
  • You can also include your spouse and children to your plan

A-Plus HospitalIncome &A-Plus HospitalIncome Extra

This offers you financial support for the time you are hospitalized due to an illness or injury.

Coverage Period: Up to 100 years old

Entry Age: 14 days to 65 years old

Product Link: A-Plus HospitalIncome& A-Plus HospitalIncome Extra

Features:

  • In case you get hospitalized, you will receive a fixed daily income for up to 365 days to cater for your financial needs with A-Plus HospitalIncome.
  • If you are hospitalized due to a disability, A-Plus HospitalIncome Extra offers you a fixed daily income to cover for your stay in the hospital for up to 1000 days.
  • There are various daily income levels that you can choose from in accordance to your needs.
  • A-Plus HospitalIncome Extra also provides you with three times your daily income benefit if you get treatment in the Intensive Care Unit.

A-Plus HospitalIncome Extra-i(Takaful)

This product offers you financial support when you get hospitalized.

Coverage Period: Up to 100 years old

Entry Age: 14 days to 65 years old

Product link: A-Plus HospitalIncome Extra-i

Features:

  • You get a daily income for 1000 days to cover your hospital stay if your admission is due to disability.
  • There are various income options to choose from
  • You receive three times your daily income amount benefit if you require Intensive Care treatment.

A-Plus BabyCare

You can buy this add-on policy to increase your coverage during pregnancy and for your baby’s early years.

Coverage Period: Up to 5 years

Entry Age: ≤ 35 weeks of gestation

Product Link: A-Plus Baby Care

Features:

  • Provides cover if your baby gets admitted in the Neonatal Intensive Care Unit, ICU, or high dependency Unit.
  • It is the first product in Malaysia to provide coverage for Attention Deficit Hyperactivity Disorder and Autism Spectrum Disorder.
  • It also offers you coverage for pregnancy complications and loss of the baby while in the womb.

A-Plus BabyCare-i(Takaful)

This is the Takaful version of A-Plus BabyCare. It is an optional rider that you can buy to increase your coverage during pregnancy and early years of your child.

Coverage Period: Up to 5 years

Entry Age: ≤ 35 weeks of gestation

Product link: A-Plus BabyCare-i

Features:

  • Provides coverage for pregnancy complication and the ultimate loss of the baby before it’s born
  • Has a child care benefit which offers coverage if the baby is admitted in the Neonatal Intensive Care Unit, ICU, or High Dependency Unit.
  • It also provides coverage for Attention Deficit Hyperactivity Disorder and Autism Spectrum Disorder.
  • Any excess from the Takaful Risk Fund at the end of the year is shared equally with the eligible participants.

Summary

Just like other medical insurance plans, AIA medical does not cover certain medical conditions, often referred to as major exclusions. These are mainly pre-existing illness, cosmetic surgeries, or treatment certain illnesses within 120 days of the plan.

Prudential Savings Plan Malaysia Review – Understanding Prudential’s Concept

Prudential Savings Plan Malaysia Review

Having a savings plan is important whether you are planning a dream holiday, saving for rainy days, saving for your children’s education, etc. A savings plan ensures that your money is able to grow and is secure for future use. It is a good way to grow your wealth and ensure that your future and that of your family is secured.

Savings help grow wealth within a period of time

Prudential Savings Plan

Prudential savings plan is one of the many products being offered by Prudential Assurance Malaysia Berhad. It is a type of With-profit investment plan which is designed to provide potential capital growth on your investments while allowing you to take regular or one-off withdrawals.

You can invest by making a single payment or regular payments on a monthly basis. If you choose to make a single payment, you will have to wait for a period of five years to be able to withdraw from your account. If on the other hand, you choose the regular payments method, you will be required to pay for a minimum of five years and wait for at least ten years to be able to withdraw from your account.

You can invest up to a maximum amount of £500,000.

Prudential Assurance Infographic in Malay
Source: https://pruejamzura.wordpress.com/2014/12/03/sudahkah-anda-bersedia-di-saat-persaraan-kelak/

How Prudential Savings Works

Prudential savings account and investment bonds are long-term to medium investments that allow a mix of regular and single investments. Your money is invested in the Prudential With-Profit Fund after applying the allocation rate and deducting the initial charge.

This investment helps smooth the return of your money for the period of time that you hold the account. Your money is pooled with those of the other Prudential investors to create a fund that is then invested in several investment options including government bonds, company shares, properties etc. You will then receive your share of the bonuses depending on your share of profits. These plans also offer a small amount on terminal illness and life insurance cover.

There are two types of bonuses: Regular bonus which may be added regularly every year, and the final bonus which may be added when you withdraw money from your account. The amount of bonus you get will depend on how much is in your account. Accounts with an amount less than £6000 receive a reduced bonus rate.

Note that the value of an investment may increase or reduce with time which means that the bonuses are not guaranteed and you may not be able to get back the amount you had invested.

Types of Savings Plans at Prudential

There are six types of savings product available at Prudential that you can choose from. These include PRUgrowth, PRUcash, PRUcash double reward, PRUcash premier, PRUlink investor, and PRUlink global investor account. Here is a summary of these different savings products; for more details on the products, we recommend that you contact Prudential Assurance Malaysia Berhad (PAMB).

PRUgrowth Account

This plan has a short premium payment term of 5 or 10 years. It helps you grow and secure your savings by offering you yearly entitlement of Annual Boosters and at the same time providing an insurance coverage of death or total and permanent disability. A 100% of sum assured together with any other benefits that you are entitled to are payable upon death, total and permanent disability, policy maturity or when you surrender the policy.

PRUcash Plan

This plan offers a guaranteed payout of 6% of the sum assured every two years before the policy matures to give you some liquidity. A 100% of the sum assured and all the other guaranteed and non-guaranteed benefits (if any) are paid upon the death or permanent and total disablement of the policyholder or upon surrender or maturity of the policy. The minimum sum assured that you can get from this policy is RM 10,000, while the maximum sum assured for children under the age of 16 is RM 500,000.

There are several optional riders that you can buy with this policy including cash boosters (for your savings), crisis cover benefits (in case you become critically ill) and others.

PRUcash double reward

In this plan, you are able to save and receive a double annual guaranteed payout of 3% from the first to the fifth year of the policy and 6% from the sixth policy year onwards. The sum assured will then double the initial sum assured (200%) from policy year six for death, total and permanent disability coverage. Upon maturity of the policy, you are entitled to a lump sum maturity benefits which include the 100%of the initial sum assured together with all the first year survival benefits and all other applicable bonuses.

PRUcash premier   

With premium payment term of 10 years, this policy offers a guaranteed annual payout of 4% of the sum assured from the end of the 10th policy year onwards except for the final policy year. A 100% of the sum assured plus total bonuses (if any) are payable upon death, total and permanent disability, and policy maturity or upon surrender of the policy.

PRUlink Investor  

This plan is a single premium investment-linked insurance that allows you to manage your investment and also keeps you protected. You are able to invest in various local funds and also get life insurance coverage of 125% of your single premium or the total value of your units from RM 5000- whichever is higher. The minimum premium that you can invest is RM 4000 and you can switch between local funds whenever you want.

PRUlink global investor  

This is also a single premium investment-linked insurance that allows you to manage your investment and also get protected. Just like the PRUlink Investor above, this plan offers you life insurance coverage of 125% of your premium or the total value of your units from a minimum of RM 5000. You are able to invest in the global funds of your choosing from a minimum single premium amount of RM 4000.

Making Payments to your Prudential Account  

You can choose to either be making regular monthly payments or a single payment. For regular payment, you can make monthly payments from a minimum of £20 and you or at least one of you (for a joint account) should be under the age of 80 years when you register the account. For single payments, you are able to make one or more single payments from a minimum of £300. You can switch from single to regular payments and vice versa any time you want.

You can pay through pay on phone, online payment, ATMs and Credit cards (for renewal payment). Contact Prudential official website for more information.

Stopping or Reducing your Premium

You can reduce your regular premium amount or take a break from paying your premium at any time and still be able to have your bonuses and benefit deposited in your account. This will, however, affect your account and reduce the amount that you will get after maturity of your policy.

You have an option to:

  • Stop paying the premium but not cash in your policy. In this case, you can start paying at a later date through regular or one-off payment. This is subject to certain conditions.
  • Reduce your regular premium to the one you can afford.

Withdrawal of Funds from your Prudential Savings Account

There are two ways that you can access your money from your Prudential Savings without having to cash in your entire savings.

Regular withdrawals:-

  • If you invested a single payment, you can opt to take a regular withdrawal from your account.
  • Every withdrawal should at least be £50
  • You may have to pay Income Tax on any profit you make when you cash in the policy
  • You are not able to make regular withdrawals from your account while you are still paying regular savings
  • Market Value Reduction may be applied on your withdrawals which will reduce the value of each unit you cash in thereby lowering the value of your account.
  •  Every withdrawal will lower the value of your account

One-off withdrawal:-

  • The minimum amount you can withdraw is £200
  • Your account should remain with a minimum balance of £1000
  • A market value reduction may also be applied therefore reducing the value of your account.

What you will get back.

If you do decide to cash in your account, you will get back the value of your bond which has no guaranteed amount. The amount you will get will be determined by the following factors:

  • The amount that will have been paid into your bond
  • How long each amount of money had been invested
  • The bonuses and benefits that will be added
  • The amount and timing of charges that will have been taken
  • If you have taken any withdrawals
  • Market Value Reduction amount that will have been applied to the value of your bond

What happens to your Prudential Savings if you die or become critically ill?

In the unfortunate event of your death or if you become terminally ill, Prudential Assurance has an obligation to pay out at least 101% of the value of your account. A terminal illness, in this case, means that you are expected to die within 12 months after being diagnosed.    

If you have a single life account, the payment will be done when you die or are diagnosed with a terminal illness. On the other hand, if you have a joint life account, the account is passed on to the surviving policyholder and payment will be done only after the second person dies or becomes terminally ill.

Cancellation of Policy

If you change your mind about taking the policy and decide to cancel it, we recommend that you do so within 30 days in order to get back all your money. Cancellations done after 30 days will incur several charges and therefore you will not be able to get all your money back.

When your application is accepted, you will receive a cancellation notice which you can fill in and send back to the company if you want to cancel. Where a policy is held in joint names, any of the policyholders can cancel the policy.

Benefits of Having a Prudential Savings Account

When you have a savings account at Prudential, you will be able to enjoy the following benefits:

  • You are able to get Critical illness/temporary life insurance coverage  
  • You are able to withdraw your money anytime you want. You may, however, incur some charges and a Market Value Reduction on certain withdrawals.
  • If you encounter some financial difficulties, you are able to adjust your premium amount to the one you can afford. You are also allowed to switch between funds depending on your risk appetite.
  • You can access and view the latest With-Profit Bonus Declaration
  • You get smooth returns from your investments
  • You enjoy some basic tax relief from your profits.

Risks of having a Prudential Savings Account

  • The value of your account can increase or decrease at any time and is therefore not guaranteed.
  • There are several charges which you may incur when you cash in your account.
  • If you top up your account and then cancel after 30 days, you will not get your full refund
  • Tax rules change may change at any time
  • If the charges you incur are more than the overall growth of your investment, you value of your plan will reduce to even less than you had invested.

Important Terms that You Should Know

Allocation rate: – is the percentage applied to your payments before the charge is deducted and the rest of the money invested. This rate changes from time to time and is therefore not guaranteed.

Market Value Reduction (MVR):- refers to the deduction that is made whenever you withdraw from With-Profit Funds. It is meant to protect investors who are not withdrawing by making sure that every investor gets a fair return from their With-Profit Funds.

Initial charge: – this is a 6% charge that is deducted from every regular or single payment you make to your account.

Annual charge: – this is the charge that is deducted from your account every year

Reason You’ll Never Know Why Insurance is Important To You

Why is Insurance Important?

Life does not always go as planned. There are certain unexpected events which may arise to set us back from our plans. Some of these events are too expensive for us to cover alone; which is where insurance comes in.

Insurance offers us protection from financial loss. It pays the expenses that may arise from unexpected events in your life so that you don’t have to. It is a form of risk management plan which is commonly used to protect people and businesses from risks of certain loss.

Insurance is provided by an establishment known as an insurance carrier, insurance company, insurer, or an underwriter. An insured or policyholder is the person who buys insurance. The transaction happens when the insured pays a regular certain amount of money known as premiums to the insurer in exchange for the insurer offering compensation to the insured in case of a covered loss. The insured receives a contract called an insurance policy which contains the entire details on the claims which the insurer is legally obligated to pay.  

Functions of Insurance

Insurance functions can be divided into two categories- primary and secondary functions.

Primary function:

  • Provides protection

The main function of insurance is to provide protection against future risks, unfortunate events, and uncertainties. It guarantees compensation in an event of loss ensuring that the person does not suffer a major financial crisis.   

  • Ensures certainty

No one knows what the future holds. Unfortunate events can happen at any time of our lives without a warning. Insurance provides certainty of payment in the uncertain event of a loss.

  • Evaluate and shares risk

Just as the risk is uncertain, the loss is also unpredictable. Insurance assesses and evaluates the possible volume of risk and shares the financial loss with the insured through premiums.

Secondary functions:

  • Prevents losses

By joining hands with institutions that are involved in loss prevention such as fire brigade, hospitals, education institutions, and others, insurance ensures that the assured is safe from loss. This increases savings while reducing the number of premiums which then stimulates more businesses.

  • Provides capital

Insurance contributes to the growth of the economy by providing capital to the society. It invents the accumulated funds in various productive channels and also offers loans to businesses and individuals.

  • Helps in economic development

By providing protection against huge losses, damages, and death, insurance ensures that people continue working hard for the betterment of the society. It also provides a cushion for individuals and businesses so that they don’t lose much in an event of a disaster which means that there is progress.

  • Improves Efficiency

Insurance also reduces the grief and misery brought about by a loss at death and property distraction. This allows people to be less destructed and focus their attention on improving their lives.

Types of Insurance

There are many types of insurance covers available in Malaysia today- even more than you would think. Every insurance company has its fair share of insurance products that it is offering to its customers. Almost every possible risk has been assessed and covered by insurance companies.

However, there are three common types of insurance in Malaysia. These are:

Medical and Health

This is the most basic and important type of insurance that everyone should have. It covers all or part of your medical and hospitalization expenses if you fall ill or get into an accident. There are many types of medical and health insurance covers in Malaysia. They include a Medical Card or Hospitalization cover, critical illness plan, and hospital income insurance.

Here is a detailed review of medical and health insurance in Malaysia.

General Insurance

This type of insurance covers some of our most prized possessions such as our homes, properties and cars and others.  The most popular covers under general insurance include:

  • Car insurance:-It is compulsory to have a Third Party Liability Motor (TPL) Insurance if you own a car in Malaysia. Car insurance protects you as the policyholder from any financial liability if you injure someone in an accident with your car. The insurance company pays the injured third party so you don’t have to worry about it. In addition to this, you can pay for theft, fire, or own body protection to extend the coverage to your car. For better coverage, most people opt for a comprehensive insurance cover which ensures repairs to your car even if the accident was not your fault.
  • Travel insurance:-This insurance makes sure that you are protected from any travel related risks such as travel delays and cancellation, medical emergencies, lost baggage, loss of passport and others. It is important to have travel insurance if you are a frequent traveler.  
  • Personal accident insurance: – In this type of insurance, the insurance company pays a fixed amount of money if you suffer temporary/partial/permanent injury, disability or death caused by an accident.

Life Insurance

When you have a life insurance policy, an agreed sum of money (sum assured) is paid to your beneficiaries upon your death, critical illness, or permanent disability. The common types of life insurance plans are:

  • Whole life insurance:-which provides lifetime coverage against risks in life. You pay periodic payments monthly or yearly up until a set maturity date which is usually 10 to 20 years, or until you retire. When you die, your beneficiaries receive a lump sum amount of money as a payout.
  • Term Insurance:-this also provides coverage for you against life risk but the payment period is usually shorter than that of whole life. Your beneficiaries will only receive a big lump sum payment if you die within the policy period. If no death occurs, there will be no payment to be made.

Advantages of Insurance

  • Provides economic protection: – it guarantees compensation against major financial losses in exchange for a little premium.  It also offers financial security to beneficiaries in case of death or permanent disablement of the insured.
  • Encourages savings and investing: – the insured person is required to pay a set amount of money at a regular basis on time in exchange for compensation in case of a probable loss in the future, during retirement, or upon death. This encourages disciplined saving and unnecessary money usage.
  • Reduces risks:-We are all exposed to life’s uncertainties and risks that may lead to major losses. The risks and uncertainties are impossible to entirely get rid of, but it becomes easier if they are shared. Insurance helps the insured to share the risks which in turn reduces them to a manageable level.
  • Grants loans: – An insured person can acquire the facility of a loan from his insurer or even take a loan from any other financial institution using his insurance policy as security.
  • Provides employment opportunities:-Insurance companies offer employment opportunities to thousands of people either directly or indirectly. With the steady growth of the insurance industry, more and more people are getting involved in this line of work.
  • Ensures smooth running of businesses: – There are many risks involved in the running of a business including theft, loss of stock and damaging of properties, insurance has managed to reduce the risks by offering financial compensation to business and their employees.
  • Helps secure future goals:-Buying a house, higher education abroad, dream wedding, traveling, etc. Whatever your future plans are, insurance helps to make them a reality. By saving and investing in an insurance plan of your choice, you will be able to reap the fruits of your savings in the future. You can also secure the future of your family through a life insurance policy that will ensure that they will be taken care of even when you are no more.
  • Peace of mind: – By managing your risks, you will be more at peace and will be able to enjoy life. With the rising medical cost, it is mandatory to have a health cover for you and your family. A life insurance plan will also make you rest easy without worrying about what will happen to your loved ones when you are not there.

Disadvantages of Insurance

  • Insurance does not offer compensation to all types of losses
  • Cash surrender value of a policy is usually less than the premiums you had paid.
  • It may take some time to receive compensation due to lengthy legal formalities.
  • Buying Insurance can be expensive for some people
  • Claims are not always paid out

Conclusion

Having insurance should be more of a necessity than a luxury. It doesn’t matter how careful you are, calamities are unavoidable and can happen to anyone at any time so it’s better to be prepared. You don’t have to buy all the insurance covers, but make sure that you at least have a health cover for you and your family members then later you can consider getting a life insurance to protect your family in case something happens to you.   

Retirement Planning in Malaysia – Prepare For Real Relax Life

RETIREMENT PLANNING IN MALAYSIA

How you save in your youth will determine how you will live during your golden years. Retirement Savings is something that most people find to be a bit of a challenge. Retirement may seem to be far off in the future especially if you are still in your twenties, but it is necessary to start planning now to make sure that you will have enough to support yourself when you retire.

The high cost of living and increasing inflation has made it essential for everyone to have a retirement plan.

You will be able to enjoy your retirement if you plan well for it

What is Retirement Planning?

Retirement planning simply means allocating funds to use when you retire. It means making plans to live comfortably when you can no longer work to support yourself due to old age. There is also the other non-financial aspect to planning for retirement which involves planning how to spend it, when to retire, where to live, etc.

The best time to start planning for your retirement is the moment you start getting a stable income because the earlier you start, the more funds you will have accumulated by the time you retire at 55years. Some of the most basic needs that you will need to consider when planning your retirement will include a home, money for your everyday expenses, medical bills, and emergencies.

How to Effectively Plan For Retirement

  • Setting your retirement goals– How will you spend your retirement? List down what you want to do when you retire from the most important to the least important. Make sure that your list rules out unnecessary expenses and try to be as specific as possible. When you know and understand your goals, you will be able to determine how much you should save in order to achieve them.
  • Identifying sources of income– that you can completely rely on when you retire. This includes your savings, investments, EPF or Pension, properties or businesses etc. Make a list of all of them and add them up to find out what they will total up to each month.
  • Estimating your expenses– This includes your day to day expenses, loan repayment, rent/mortgage payment etc. Cut the unnecessary expenses so that you can start saving more.
  • Managing your assets– This will require a lot of discipline on your part. You have to make sure that your resources will last as long as you need it and you will not run out of cash in the middle of your retirement.
  • Prepare for the unexpected– Nobody likes to think of anything bad happening to them, but it is always good to be prepared. You would not want to be caught off guard during your retirement. Take your time to think of how you will pay or respond to any issue that may arise- whether minor or major. It doesn’t hurt to have some money set aside for emergencies.

Retirement in Malaysia

Retirement age in Malaysia is currently set at 55 years for employees in both the public and the private sector. A government pension plan is available for employees in the public sector. With this pension plan, retired employees receive a monthly pension which is normally half of their salary. The employees in this sector can also opt to have an Employee Provident Fund retirement plan.

For employees in the private sector, the government policy requires them to set aside a portion of their salary into the Employee Provident Fund (EPF) to make sure that they have enough savings for retirement. This is usually 23% of their monthly income which is credited into their EPF accounts. From this, 12% is contributed by the employer, and 11% by the employee.  The contribution is then placed into two separate accounts- account 1 and 2.

Account 1:- 70% of the monthly contribution which is meant for retirement financing is allocated into this account. The funds can only be withdrawn when the contributor reaches the retirement age of 55years, becomes incapacitated, relocates to another country or dies.

Account 2:- holds the remaining 30% of the monthly contribution. The funds in this account can be used to cover medical expenses, housing loans, financing education etc.  The member should at least be 50 years old to be eligible to withdraw from this account.

Most people in Malaysia solely rely on EPF to plan for their retirement and feel that the money is enough to cater for all their needs when they retire. However, a recent report showed that a majority of households run out of funds after a few years in retirement.

Private Retirement Scheme

This was introduced in 2014 as a supplement of Employee Provident Fund (EPF) when it was discovered that most Malaysian only depend on EPF for their retirement savings which is usually not enough. The PRS is a defined contribution scheme where individuals can accumulate savings retirements.

Who are the PRS Players?

Administrator: – Private Pension Administrator is a body approved by the SC to perform the role of the administration, customer service, and record keeping for the members and contributors of the scheme.

Trustees: – is an independent third party that is responsible for safeguarding the assets of PRS for the contributor.

Providers: – are approved by the Security Commission (SC) to provide the PRS services. There are currently 8 PRS providers in Malaysia who are mandated to manage and provide Private Retirement Scheme.

Distributor: – responsible for selling the PRS funds. They include sales agents, bank branches etc

Contributors: – are individuals that contribute to the PRS.

Types of Private Retirement Schemes Available

Each of the eight PRS offers and manages its own Private Retirement Scheme which is comprised of several funds. In general, a provider will offer at least three Core funds. These Core Funds should have the following features according to the guidelines set up by SC:

Conservative Funds Moderate Funds Growth Funds
Default Age Group Above 50 Years 40 to 50 years old Below 40 years
At least 80% in debentures/fixed

Income securities and

of which 20% should

be in money market

instruments and a

maximum of 20% in

Equities.

Foreign investment not allowed.

Up to 60% investment in equities

Foreign investment allowed.

Up to 70% investment in equities.

Foreign investment also allowed.

  

 

PRS member is given an option to contribute to funds to just one PRS provider or they can contribute to different funds offered by different PRS providers. This being voluntary in nature, members are free to any amount they are comfortable with whenever they want.

Benefits of Contributing to PRS

Tax Relief

Both the employer and employee are able to receive an annual tax incentive of up to 19% for employers and RM 3000 for employees. This in addition to the tax relief provided for EPF contribution adds up to a significant amount in savings.

Supplements your retirement savings

You want to make sure that you have enough money to sustain you throughout your retirement and Employee Provident Fund (EPF) is just not enough. PRS compliments your EPF and helps you increase and safeguard your retirement savings.

Offers Flexibility

Members are allowed to switch between PRS funds any time they feel like and they can also change providers once a year.

PRS Withdrawals

Just like the EPF system, PRS contributions are divided into two sub-accounts where sub-account (A) Gets 70% of the contribution and the other sub-account while (B) gets the other 30%.  The funds can be withdrawn in parts or in full under the following circumstances:

  • Upon reaching the age of retirement, this is currently 55years
  • In case the member dies
  • If the member relocates permanently to another country
  • Pre-retirement withdrawals (before reaching 55 years)

Pre-retirement withdrawals can only be done from sub-account B once a year and the first withdrawal can only be made at least a year after making the first contribution. This withdrawal, however, attracts a tax penalty of 8% of the amount withdrawn

If a member dies, the scheme will be required to release all or part of his/her savings to the executor or the named beneficiary of the member.

How to Join PRS

To become a PRS member, the first thing you need to do is choose a PRS provider among the eight authorized providers in the list below. After you have done that, select a fund that is most suitable to you and open a PRS account with your selected PRS provider and start saving.

Who are the Authorized PRS Providers?

  • Affin Hwang Asset Management Berhad
  • AIA Pension and Asset Management Sdn. Bhd.
  • AmFunds Management Berhad
  • CIMB-Principal Asset Management Berhad
  • Kenanga Investors Berhad
  • Manulife Asset Management Services Berhad
  • Public Mutual Berhad
  • RHB Asset Management Sdn. Bhd.

Conclusion  

If you have not yet planned for your retirement, then you should start doing so now. Just start thinking about how you want your retirement to look like, and make a plan to make it a reality.

Having as many avenues as possible to save for your retirement will ensure that you will have a comfortable retirement and you will not worry about your money running out a few years after you retire.

 

100 Questions & 100 Answers of Life Insurance in Malaysia

Life is mostly uncertain and unpredictable. One time you can be happy enjoying life with your loved ones and suddenly everything changes. Nobody likes to think about anything bad happening to them or their loved ones but it is always good to be prepared.

Life insurance is vital to ensure that you and your family are protected in case of any fatality or unfortunate event.

However, a big number of Malaysians don’t include life insurance cover in their financial planning. In fact, a 2012/2013 study conducted by the Life Insurance Association of Malaysia (LIAM) established that only 56% of Malaysians have a life Insurance cover.

 Life insurance protects you and your family from any unavoidable and unforeseen life events.

How does Life Insurance Work In Malaysia?

A life insurance cover is a contract between you as a policyholder and your insurance company whereby you will be required to pay a set amount of money known as premiums at regular interval i.e. monthly, quarterly, bi-annually or annually or in a lump sum to your insurer. In exchange, if you suffer from any disability, serious illness, or death, your insurer will pay a lump sum amount to you (in case of illness or disability) or to your beneficiaries/nominees (in case of death).

What is covered by Life Insurance?

Death

This is one of the main motives for getting a life insurance policy. If you have people who depended on you financially such as spouse and children, you will want to make sure that they do not suffer if anything bad happens to you and that they can still live comfortably. A life insurance policy will cover death that is caused by old age, accident, illness, or even suicides. However, there is some exclusion to the deaths as a result of suicides that are not covered.

Permanent Disability

If the policyholder becomes permanently disabled and is unable to work and provide for the family, the life insurance policy kicks in. A Doctor will, however, be required to confirm that the insured person is completely unable to work or perform any tasks to earn an income so as to approve the claim.

What is not covered by Life Insurance?

Suicide

If the policyholder commits suicide within a year of buying a life cover, the insurance company will not pay his/her beneficiaries. This is due to the clause found in most insurance contracts that clearly state that there will be no payout if the policyholder commits suicide within a year of taking the contract.

Other than that, there are other deaths and permanent disabilities that are not covered by many life insurance providers. These may include:

  • Death or disability caused by involvement in high-risk activities such as hazardous sports e.g. bungee jumping, deep-sea diving, motorsport racing etc
  • Deaths or disability as a result of war or terrorism

We suggest that you talk to your insurer about this exclusion to find out if it will cover your needs.

Who Needs a Life Insurance?

Nobody knows what tomorrow will bring. To find out if you really need a life insurance cover, think about the worst-case scenario. If something happened to you tomorrow, what would happen to your loved ones? Would they be able to cope financially? Would they afford to pay for your funeral expenses or medical bill? Would they be able to meet their day to day expenses? What about your children’s future? Would your children manage to continue with their education?

If you think that your family would suffer financially if you are not there, then you need to consider getting a life insurance cover. The death benefits help your family meet their financial needs by replacing your income.

Life Insurance ensures that the people you care for are well taken care of financially even if you are not around or have lost the ability to do so.

Life Insurance policy is most suitable for anyone with financial dependants and therefore is not necessary for retirees who no-longer have people who depend on them financially.   

In Malaysia, you are able to claim a tax relief of up to RM 6,000 annually for a life Insurance policy and also your Employee Provident Fund (EPF) contributions.

Types of Life Insurance Available In Malaysia

When choosing a Life Insurance, you can opt to choose the ones that offer a share in profits or those that don’t. Those that don’t share profits tend to be relatively cheaper.

 

  • Whole Life Insurance

Just as the name suggests, this option is designed to provide life-long coverage where the policyholder pays the premiums throughout his life. Payment of the sum is given to the beneficiaries only after the death of the policyholder or in case of total and permanent disability of the policyholder. It is the best life cover for those who want to ensure that their families are well taken care of in case of their own demise.

 

  • Endowment Life Insurance

It provides a combination of savings and protection whereby the money and the bonuses earned are paid upon the demise of the policyholder within the term of the policy. If you survive the policy period, you will receive the sum accumulated and bonuses once the policy is over. You can choose to have an endowment plan for varying periods over 10 years or up to a certain age.

This plan is best suited for savings, wealth transfer and preservation, and tax-deferred wealth accumulation.  

 

  • Investment-Linked Life Insurance

This provides investment and protection whereby your premiums will be divided for life cover and investment fund of your choice to increase your returns. You can decide on the ratio of your premium’s allocation.

This option will also provide you with savings, wealth transfer and preservation, and tax-deferred wealth accumulation.

 

  • Term Insurance

This is only available for a specific period e.g. 10 years and the sum is only paid upon the demise of the policyholder within that set period. If you survive the policy period, you will not receive any payment even if you had paid all your premiums.

This option provides the highest instant cover at the cheapest price.

 

  • Life Annuity Insurance

In this option, the insurance company pays you over a set period of time up to the day you die. There are two types of annuity which include the immediate or deferred annuity. Immediate annuity starts within 12 months after you have bought the annuity. It is mostly taken by those who are about to retire or those that have already retired. Deferred annuity, on the other hand, starts in more than 12 months after you buy it. People mostly buy this while they are still working so that they can receive payment when they retire.

This plan is best for retirement savings and wealth accumulation.

 

  • Mortgage Reducing Term Assurance(MRTA)

This is designed to repay an outstanding property loan in case of the untimely death, serious illness or disability of the borrower. In the event of such eventualities, the insurance company pays the outstanding loan amount to the financial institution which then releases the property owner to the owner or his/her beneficiaries.

 

  • Supplementary Rider

This is a supplementary attached to a basic plan such as Whole life and Endowment. Most common riders include critical illness, medical, and personal accident.

 

Why Is Life Insurance Important?

  • To financially support your family – Leaving your family behind without protection can be quite devastating for them especially if you were the breadwinner. That is why it is important to have an affordable life cover that ensures that your family will continue being taken care of even when you are not there.
  • To pay debts- In case of your demise, all your debts including property and personal debts are automatically transferred to your family if you are not covered. A life insurance policy will help your family to pay off the debts which will save them from creditors.
  • Funeral Expenses- Funerals can be quite expensive and may cause a strain to your already grieving family. A life cover takes care of all your burial expenses to allow your family to mourn in peace.
  • Saving plan- Most insurance products have riders that include saving features which allow you to claim your cash value after your policy matures.
  • Reduce income tax- Buying insurance provides you with tax relief of up to RM 6000 each year.
  • Fund your children’s education- You can use your life insurance as an alternative to pay for your children’s education when you are not there. You can also opt to surrender your policy with an endowment plan.
  • Secures your assets and savings- When you have a life insurance your family will not be forced to liquidate your assets or use up your savings in order to pay debts. Instead, they will enjoy more benefits that will have been acquired from the cover.

Factors to Consider When Choosing a Life Insurance Cover

Insurance is for life so you don’t want to make mistakes that might eventually cost you or your family. When choosing the best life cover, do your research and consider all the important aspects before you buy. Here are a number of aspects that you should consider before buying a life insurance plan that best suits you.

  1. Financial Goals

Determining your financial goals will help you decide on the best life insurance to buy. Although the most common reason for buying life insurance is to continue financing your family after your demise, there are still other ways that a life insurance cover can help you. You can take a life insurance plan that gives you a lump sum amount on maturity when your retirement or you can even save towards financing your child’s overseas studies. Whatever the goal is, it will help you towards picking the best-suited policy plan.  

  1. Cost of Premium

You should be able to comfortably pay your premium. Paying high premiums will strain you and will eventually lead to a lapsed policy. Financial planners recommend that your premium should not be more than 6% of your income. This simply means that if your income is RM 6000, your insurance premiums should not exceed RM 360.

When choosing a policy do your comparison and make sure that you will be able to afford it.

  1. Value of Policy

The next factor to consider is the amount of coverage you need. There are some online calculators to help you determine how much your dependents need. However, the best way to determine just how much coverage you need is with the help of an agent who will assess your needs based on your situation and financial goals.

Choosing the right insurance plan is greatly influenced by you and your family’s current and future financial needs. Other factors that determine the type of insurance plan that you should have include marital status, married with children, age, and income.

It is not enough to just get a life insurance policy; you should get a policy that will completely cover your whole family in case of any unfortunate event.

Importance of Disclosure

When applying for a life insurance policy, you should make sure that you completely fill the form truthfully or your policy will be void. If your agent is the one that filled the form for you, make sure that you read and understand all the requirements before signing it.

 

What to do if you can no longer afford to pay your premiums?

If you encounter some financial problem and you are not able to pay your premiums, the policy contract offers a “grace period” which gives you more time after the due date to pay the premium. This grace period is normally 15 days for a monthly mode of payment and 30 days for other modes (semi-annually and annually).

If the grace period is over and you still cannot afford the premium, you have an option to keep the policy active by using a “non-forfeiture loan” which simply utilizes the cash value that your policy had earned to pay for the premiums. Your policy will lapse once the cash value is finished.

On the other hand, you can opt to change your policy to a “paid up” policy whereby the policy and the sum assured is active up to the last time you paid your premium. You will not be required to pay any more premiums but your policy’s validity will only be up to the amount you had paid which means that the sum assured will reduce.

If your policy lapses, you may revive it within a set period under specified conditions including declaring your health status at the time.

We recommend that you speak to your insurance company for more details on the options available to you if you are having problems paying your premiums.

 

What happens if you cancel Your Life Insurance Policy?

Purchasing a life insurance cover is a long-term commitment. If for one reason or the other you decide to cancel your policy, you will not get the full amount that you had paid in premiums up to that date. This is because the surrender value (value of your policy when you cancel it) is less than what you had paid.

It is also not advisable to replace your current policy with a new one because there is a likelihood that your new policy may have a higher premium and will also incur some additional costs. Therefore, before terminating, replacing, or borrowing on a policy, discuss with your insurance company to find out more about what you will be forfeiting.  

You can however still get a refund of your premium if you cancel your policy within the 15 days ‘free look’ period. You can do this by returning your policy to your insurance provider after receiving the policy document.  

What you need to keep in Mind

  • Your life insurance policy may lapse if the premiums are not paid on time, therefore, it is important to note when your premiums are due.
  • Always insist and keep a receipt as proof of payment which you may need when there is an investigation if your agent fails to forward your payment to your insurance company.
  • Make sure that your age is correctly stated in the insurance proposal form because it may affect the amount that your insurance company gives to your nominees in case of your demise.
  • Keep your insurance form in a safe and secure place and write the basic information of the policy such as the type of policy, policy number, and your nominees’ names in another place.
  • Ask your insurance company for clarification of anything that you don’t understand in the policy document.  

 

Conclusion

It is important to have a life insurance cover especially if you are the breadwinner in your family. Make sure that you tell your nominees about your life insurance policy and where you keep the documents. Also, keep them updated on any changes you make on the documents. Having a secondary nominee is also important in case your main nominee passes away before you.  

Medical and Health Care In Malaysia – The Benefit of Having One

MEDICAL AND HEALTH CARE IN MALAYSIA

Malaysia operates a two-tier system of healthcare. This consists of a government sponsored universal healthcare system and a co-existing private healthcare system. The government has put into place funds to ensure that every Malaysian resident is able to access good and affordable health care in public hospitals within the country.

While the cost of healthcare in public hospitals is the cheaper and more affordable option, most Malaysians still seek treatment from private hospitals regardless of the cost. This is because unlike the public ones, the private hospitals are less crowded, have more doctors, and offer faster services to their patients.

Health and medical care insurance policy helps cover the cost of medical treatment

 

Medical and Health Insurance (MHI)

A medical and health insurance (MHI) policy help is designed to help cover the cost of treatment in private hospitals. This includes the costs of hospitalization, surgical, and healthcare services if you get diagnosed with an illness that is covered by the policy, or in case you get into an accident.

This coverage is offered by licensed insurance companies in which you have to pay premiums.

Types of Health Care Coverage

There four major types of medical and health insurance being offered in Malaysia. These include hospitalization and surgical insurance, 36 critical illness insurance, and hospitalization benefits.

 

  • Hospitalization and Surgical Insurance

This is the basic medical insurance. It offers medical coverage to hospital and surgical expenses incurred during treatment of a specified illness, or accident. It is suitable to everyone who wants a medical cover.

 

  • Critical illness Cover

A lumpsum is provided by the insurance company upon diagnosis of any of the 36 critical illnesses (also known as dread diseases). Some of these illnesses include cancer, heart attack, stroke, blindness, Alzheimer, etc.

 

  • Long-Term Care Insurance

This offers coverage for long-term care including home care, assisted living, nursing homes, adult day care, and Alzheimer facilities. It is suitable for people who live alone and don’t have anyone to take care of them when they get ill or old.

 

  • Hospitalization Benefits

This provides an agreed amount of money on a daily, weekly, or monthly basis to you when you get hospitalized. This will ensure that your family is able to cope financially even when you are still in the hospital recovering. It is suitable to get this cover if you have young children, a spouse without an income, aged parents or young siblings that rely on you financially.

It is usually recommended to get all the four type to ensure that you are fully covered. However, if you are at a low-risk age and leading a healthy lifestyle, a basic medical card which offers hospitalization and surgical cover will probably be enough. Depending on your policy, some medical cards also provide insurance on death, and total and permanent disablement.

If you don’t have any dependants, it is not necessary to have a hospitalization benefits cover.

 

Exclusions

A Medical and Health Insurance cover contains a number of exclusions which are not covered by insurance companies. It is important to know what these exclusions are before committing yourself to buy a MHI cover. Each insurance company has its own list of exclusions which you should find out through your agent, or insurance provider. Some of the most common exclusions are:

 

  • Pre-Existing Conditions

This simply means that if you suffered an illness in the past before you applied for a MHI policy, the insurance company will exclude that illness from the policy cover.

 

  • Qualifying/ Waiting Period

You are not able to make a claim for any medical or physical condition which may arise within the first 30 days of the policy. However, the insurance company will cover accidental injuries.

 

Factors that Determine which Type of Insurance to Buy

Factors such as age, income, marital status, and children will play a big role to determine which type of MHI will be the best suit for you. However, there are still other important factors that you need to consider before buying a medical and health insurance cover. Such factors include premium, coverage, and panel hospitals and reimbursement.

The Premium

While it is important to buy a MHI policy that you can afford, you should also make sure that the policy offers the coverage you need.  You need to list down the most important things that you need to have covered and then find a policy that will be affordable to you.

The Coverage

When you get an idea of what type of MHI you need that is within your budget, you can then start shopping for a health insurance policy.

Some of the essential things that you should look out for are: the room and board limit, annual limit, as well as lifestyle limit.

When considering the annual and lifetime limit, make sure that you are prepared for the future. This is because of the continuous rising of medical inflation cost; the amount that may seem adequate today may not be enough in a few years.

The other Coverage to consider is the out-patient treatment plan which will cover all the other treatments that you will need after hospitalization. Without this coverage, you may find yourself spending a significant amount of money from your own pocket.

Dr.Nirmala Bhoo-Pathy, a cancer epidemologist in UM  estimated the cost of breast cancer treatment to rise up to RM 65,000 per year which means that people earning below RM 4,700 will have a rough time paying for it.

ASEAN Costs in Oncology study by the Sydney based George Institute for Global Health found that a 45% of cancer patients in Malaysia suffer from financial hardship within a year after being diagnosed.

Early detection of cancer can help in treatment which can save and prolong the lives of patients.

Panel of Hospitals and Reimbursements

It is not sufficient to just have a cover with high claimable limit if you are not able to easily access the hospitals under your insurer. Look for an insurer that provides cashless health facilities within your region so that you are can access treatment without paying for them with your own money and going through the hustle of filing for reimbursement.

Other Things to Look Out For

It is important to read and understand the terms and conditions of any legal document before signing it, this include the medical and health insurance policy. If there is anything that you don’t understand, ask your agent, or insurance provider for clarifications and details.

Some of the important things that you may find in the policy document and need to understand include:

  • Co-insurance which refers to the percentage of the medical expenses which you will be required to pay. This means that if the medical cost is RM 28,830, and your insurer pays 90% of it (RM 25,497), you will be required to pay the remaining 10 %( RM 2,883).
  • Deductible– is based on the set amount that must be paid for all the covered treatment before the insurance company will begin to pay the subsequent expenses. This means that if the fixed amount deductible is RM 2000, and the annual treatment cost is RM5000, your insurer will pay RM 3000 and you will have paid the RM 2000.
  • Guaranteed renewal– it is important to have a policy that provides guaranteed renewal especially if you are over 50 years old. This ensures that you are protected throughout even despite recent diagnosis of illness.

Types of Medical and Health Insurance Plans

There are several MHI available to suit your situation. These include

Individual health Insurance Plan

This only protects the policyholder. There are two types of individual health coverage: emergency health insurance and comprehensive health.

The individual emergency health provides coverage for accidents and unexpected critical illnesses. On the other hand, the comprehensive cover offers more protection to the insured and also has a large network of medical facilities partners.  

Family health Insurance Plan

As the name suggests, this plan is designed to ensure that each member of your family protected in case of an injury of illness.  There are guidelines that are set by insurance providers that outlines who is considered as a family member. For example, some plans may cover both parents and all the children of the dependant, whilst other plans may require for members to be added individually so as to extend the coverage which will also mean adjusting the premium accordingly.

Group Health Insurance Plan

This is mostly taken by employers who seek to create a more enticing benefit package to attract and maintain workers. Group health Insurance plans ensures that companies and business are able to provide medical cover for their employees.

Other groups that use this plan are sports team, non-government organization, and schools.

Travelers Insurance Plan

This is meant for those who wish to visit Malaysia either for business, tourism, volunteering, etc and do not have an international insurance cover. A traveler’s insurance plan is design to protect you for the intended time that you will be staying in Malaysia.

For those that have relocated and have stayed in the country for more than a year or expatriates who have permanent residence in the country, an individual health insurance plan is more ideal.

 

How to Make a Claim

In order to avoid unnecessary delays with your claim, insurance companies recommend the following key actions:

  • Before receiving any treatment that is non-emergency, you should call the customer care helpline of your insurer or your agent to find out if the treatments recommended by your doctor are covered in your policy, and whether that particular hospital is part of your insurer’s panel of hospitals.
  • Always request your doctor and specialist to fill and sign your claim form.
  • Remember that different insurance companies and different policy types have different ways of making a claim.
  • Make sure that you submit a written notice to your insurance provider as soon as possible or within 30 days of the treatment period if you get diagnosed with a disability that might incur claimable expenses.
  • Also make sure that you send all the necessary claim documents and supporting documents such as original bills and receipts, physician costs and summary of treatment, and if necessary, referral letter.

Note that payments can either be denied or delayed if you don’t submit all the required and supported documents.

 

Conclusion

Having a medical and health insurance is very important not only for you but for your family as well. The key to getting a good MHI cover is not about the amount of premium you are paying but the kind of coverage you are getting. It is therefore important to do some research, compare, and choose a cover that gives you more and wider coverage. If you want to make a claim, make sure that you follow guidelines provided by your insurer for smooth and faster processing.

Car Insurance in Malaysia – From A to Z in Simple Explanation

Car Insurance in Malaysia
Having third party car insurance is mandatory if you own a car in Malaysia.
If you don’t buy or renew your third party car insurance, you will not be allowed to renew your vehicle’s road tax and you, therefore, will risk getting a penalty of up to RM 3000 if you are found driving without a valid road tax.
A car insurance policy is important because it will protect you from having to bear the entire financial burden that may be brought about by an accident.

 

Types of Car insurance in Malaysia
There are usually three types of motor insurance policies available in Malaysia. These include Third Party Coverage, Third Party, Fire and Theft Coverage, and Comprehensive Coverage.

  • Third Party Coverage

This is the most basic policy that only pays for damages of the third party i.e. driver/passenger and car that you had an accident with. The policy is designed to cover all the injuries or death of the third party and the repairs to his vehicle.

It is a requirement by law for every vehicle to have this policy.

This cover does not provide any protection to you as the first party. If an accident happens and you are the one at fault, you cannot claim against this cover for the damages to your car, or bodily injuries that you might suffer.

  • Third Party, Fire and Theft Coverage

This cover not only protects the third party from damages caused by your car, but it also covers you from any events of fire or loss to your own vehicle.

  • Comprehensive Coverage

This policy is the best of the three. Not only does it cover the third party and damages that may be caused by fire or loss of your own car, but it also covers all the other damages to your car that may result from an accident.

Below is a summary of the coverage of the three premiums:

Cover Third Party Cover Third Party, Fire & Theft Cover Comprehensive Cover
Property loss/Damage and injuries/death of third party Yes Yes Yes
Loss / damage to own vehicle due to accidental fire / theft No Yes Yes
Loss / damage to own vehicle due to accident No No Yes
Injuries/death of driver/passenger of own vehicle No No No

Extensions
These three policies will however not cover certain losses such as your death or injuries due to an accident, liability of claims from your passenger, or even any damage that might be caused by acts of nature such as landslide, floods, hurricanes, storms etc. However, you can opt to pay extra premiums to further extend your insurance coverage.

Insurance companies allow motor policyholders to extend their cover by including some more benefits. Talking to your insurer will help you decide on the additional covers that you may need to include to your standard policy.

  • Acts of nature like storms, hurricanes, typhoons, earthquakes, landslides etc
  • Windscreen and windows breakage
  • Riots and strikes
  • Additional named drivers
  • Passenger liability
  • Tutoring and other business use
  • Accessory and audio cover
  • Liabilities of passengers for negligence

 

Factors that May Affect Your Premiums
There are several factors that influence the base premium of your car insurance. These factors include your location (whether the vehicle is in the East or West Malaysia), the total insured value of your vehicle (depends on its market value), and the cubic capacity of the vehicle (the size of the engine).

The premiums are usually tariffed by the General Insurance of Malaysia and Bank Negara of Malaysia.

There are also other aspects that may cause the insurer to increase the premiums required for your insurance. These factors are known as loading and they raise the risks the insurer has on a vehicle.

  • Age of driver( less than 26 years or above 69 years)
  • Age of the vehicle(more than 10 years)
  • The Condition of the car(reconditioned or second-hand car)
  • Frequency of claims
  • High performance /Sports cars(they incur extra loading)
  • High-Risk Theft Vehicles( Cars listed here will incur more loading)

No-Claim Discount
You are entitled to a no-claim discount if you go for a year without making a claim against your policy. Different classes of vehicles have different rates with a private vehicle gaining the most NCD that starts from 25% up to 55%. The discount is standard in all insurance companies in Malaysia and it keeps increasing every year you go claim-free.

 

How to Make a Claim
Accident Claims
If you get into an accident and you have a comprehensive policy, you have an option of making an own damage or a third party claim.

Own Damage Claim
This refers to a claim on your own insurance policy i.e. comprehensive. However, you will lose your NCD entitlement. You should inform your insurer immediately the accident happens and ask to be referred to an approved workshop where your vehicle will undergo the necessary repairs. Also, make sure that you fill in the Motor Accident Report Form and submit it together with all the supporting documents to your insurer.

Own Damage knock for Knock Claim
When a third party is the one to blame for the accident and you have proof from the police that you are not at fault, your insurer will pay for your damages through an ‘Own Damage Knock for Knock claim’ and you will be able to retain your NCD.

Betterment
In a case where your vehicle is more than 5 years old, you will be required to contribute to the new spare parts needed for the repairs of your vehicle according to the scale below:-

Age of your car Rate applied (%)
< 5 years old 0
6 15
7 20
8 25
9 30
10 35
10 and above 40

Third Party Claim
If you are not the one at fault in the accident, you can make a third party claim and your NCD will not be affected. There are two ways to make this claim i.e. you can submit the claim to your own insurance company (for faster processing) or you can submit it to the third party insurance policy.

As a third party claimant, you will be required to appoint a licensed adjustor to assess the damage/loss. Submit the adjustors report together with the completely filled Motor Accident Report Form and other supporting documents immediately.

Theft Claim
If your vehicle is stolen and you make a theft claim, you must be patient and completely comply with the insurance official and police as they investigate the claim. You should usually be able to receive the settlement offer within six months after your notification or when the investigation is completed (whichever is earlier).

In case your vehicle is found before your claim is settled, you can withdraw your claim if the car is in good condition or you can convert the claim to a repair one if it is damaged. If the damage is really serious you can get a “total loss” settlement.

Conclusion
No matter how good of a driver you are, you can never predict what happens on the road. That is why it is good to be prepared and keep your car insurance and road tax update.