A life insurance is a long-term investment that protects you against unfortunate events, such as death and Total and Permanent Disability (TPD). Many life insurance policies provide coverage up to 100 years of age. Once the policy matures, you may get a lump sum amount. To get a better understanding of the schemes, a decent knowledge of about life insurance is required.
List of Life Insurance Companies in Malaysia
|Life Insurance Company||Policies Offered||Coverage Period||Coverage Amount|
|Allianz Malaysia||Allianz Powerlink, Allianz 3H Cover, Allianz Premierlink, Allianz PremierLink Advance, Allianz PrimeLegacy, Allianz i-EssentialCover, Power Shield, Allianz Ability Life, and Allianz Kasih Hayat.||Up to 100 years of age.||Up to RM4 million.|
|AmMetLife||ProtectValue, ProtectElite, Protect20, ProtectSecure Style+, ProtectCare Extra, ProtectSecure Prime, AmMetLife Lifestyle, AmMetLife Link, and AmMetLife Mega.||Up to 100 years of age.||Up to 200% coverage.|
|AXA Affin Life Insurance||AXA Create, Wealth Protector, eLife Protector, Life 80, and Hospital & Life Protector.||Up to 100 years of age.||Up to RM4 million.|
|AIA Insurance Malaysia||A-Life Joy 2, A-Life Signature Beyond, A-Life Signature-i & A-Life Signature-i PlusOne, A-LifeLink, A-LifeLink-i, A-LifeProtectTerm, A-LifeSecure & A-LifeTimeSecure, A-Life SuperJunior, A-Plus Payor & A-Plus PayorCI, A-Plus Payor-i & A-Plus PayorCI-i, A-Plus PayorExtra, A-Plus PayorExtra-i, A-Plus Disability Cash, A-Plus Disability Cash-i, A-Plus Hajj, A-LifeLink 2, A-Plus LifeExtra, AIA i-Starter Plan, AIA Starter Plan, A-Life Joy-i, A-Life Joy, AIA i-One Plan, AIA One Plan, and A-Life Signature & A-Life Signature PlusOne.||Up to 100 years of age.||Up to 200% of the coverage amount and/or up to RM500,000.|
|Etiqa Malaysia||i-Secure, Ezy-Secure, i-DoubleSecure, Ezy-Life Secure, Etiqa Life Secure, Enrich Life Plan, and Prisma.||Up to 80 years of age.||Up to 200,000.|
|Great Eastern Insurance||Great 110 Legacy, Great Cherish 80, Great Early VantageCare 2, Great MaxiProtector, Great Term Direct, Great VantageCare 2, Smart Legacy, Smart Legacy Max, SmartProtect Essential, and SmartProtect Max.||Up to an age of 100 years.||Up to 108% of the sum assured.|
|Prudential Insurance Malaysia||PRUmy medical plus, PRUmy child plus, PRUwealth, PRUlife partner, PRUlink million, PRUvantage, PRUguard my family, PRUterm, and PRUmortgage.||Up to 100 years.||Up to 5x coverage amount and/or up to RM550,000.|
Types of Life Insurance
Whole Life Insurance: A whole life insurance policy provides coverage for a lifetime, mostly up to 100 years of age. The policy protects you against death and TPD. You can get cash benefit when the policy matures or when you surrender the policy. However, premiums for such policies can be expensive.
Term Life Insurance: In contrary to the whole life insurance policy, a term insurance policy provides coverage for a limited period of term ranging from 1 year up to 20-30 years. You need to know that the assured value is paid to you only in the case of death or TPD.
Investment-linked Life Insurance: This type of insurance policy provides life protection as well as returns through the investment account. You can choose the investment account from a set of options. A part of your investment will be credited to the account, while the other part goes towards life protection.
Endowment Life Insurance: An endowment plan provides coverage for a period of 10 years or more based on your age. The policy benefit is paid in the case of death during the coverage period. If you are in good health at the time of policy maturity of the policy, you will receive the assured sum with bonuses.
How do Life Insurance Policies Work
A life insurance scheme is designed to protect your family financially when you are no more around.
You would think of a specific amount that your family may need to lead a life in your absence. You can specify the coverage amount and pay the premiums accordingly. This sum will be paid to your family in the case of your death, TPD, or policy maturity.
How to Apply for a Life Insurance Policy Online
Once you decide on a policy, you can visit the insurance provider’s website and browse through the policy of your choice. Usually, you would be prompted to fill an enquiry form with your personal details and contact number. You may also be asked to enter the coverage amount you are looking for.
A representative from the insurance company will contact you to discuss the specifics. Once you are all set, you can fill up the application form and submit it online with the required documents.
You may be required to go through a medical examination at a centre specified by the insurer to process your application.
Things to Consider while Buying Life Insurance in Malaysia
Lump Sum Payment or Monthly Income: Decide whether you want your family to receive a lump sum payout or if you want them to receive the compensation as a monthly payout. Based on your preference, you may have to choose different policies or may have to pay additional premiums.
Premium Rate: Market research is essential when you have to purchase a policy. You may get additional coverage for the same premium cost with another insurer. Or, you may get the same policy online at a lower cost than the buying the same from the branch office.
Coverage Term: Settle with a coverage term you require. If you do not have an insurance policy, you may want to get the longest coverage term possible. If you already have one, you may want a small term coverage like 5 or 10 years.
Medical Condition: You need to consider your medical condition at the time of policy purchase as many policies do not cover the pre-existing medical ailments. Also, most policies do not cover pregnancy and maternity-related complications.
Credit History: Credit history is not only important to get a loan or credit card. It also plays an important role while you purchase a life insurance policy. If your score is low, it portrays a picture that you do not handle finances well. It also speaks tells the insurer that you may not pay the premiums on time risking the policy approval.
Consult a Licensed Agent: It is important to cross-verify if the insurance agent you are dealing with is a licensed agent or not. Sometimes, you may be fooled around by a fake agent who would take the premium amount from you and abscond. So, it is best to ask for the license number of your agent and check with the insurance company about the validity.
How to Choose the Right Life Insurance Plan
Analyse Your Requirement: You must be aware of what you need from a life insurance policy before you sign-up for one. Analyse if you need a source of income for your family after your death or if you need some form of savings for a future expense, such as your child’s education. You may also look for some sort of investment while staying protected.
In another case, you might have an insurance policy provided by your employer. You would want to extend the coverage you have with another policy.
Plan Your Budget: Make a budget plan to check how much money you can spare to pay your insurance premium. It shouldn’t be like you pay the first premium and then you cannot manage to keep money aside for the premiums in subsequent years.
Do Proper Market Research: Based on your analysis of requirements and budget, you can research the available policies that serve your purpose. Make a list of the policies’ benefits and features so you can understand what is available.
Filter the Options: Consider factors, such as fees and charges, coverage term, premium rate, and others to filter the policies. You will, then, remain with one best option.
How much Life Insurance Coverage Do You Need
There are many insurance calculators on the internet that can help you understand the coverage you need and the coverage you can afford. You need to consider the facts, such as affordability, other policies you have, number of dependents, and the future expenses that have to be covered, such as home loan and kids’ education.
You can make a rough estimate of the responsibilities you will need to take care of. Enter these details on the insurance calculator available on an insurer’s website or any other site to know the coverage you will need.
You should know the importance of life insurance and how to deal with it. Compare various life insurance policies available in Malaysia to pick the right one for you. Either approach a licensed insurance agent or choose the hassle-free online process to purchase one.
Q. Can I get additional protection on my life insurance policy?
A. Yes. You can choose to get additional protection at an added cost by purchasing optional riders. They can be attached to your life insurance policy to get additional protection. For example, AIA Life Insurance provides additional riders, such as A-Plus Med, A-Plus MedBooster, A-Plus HospitalIncome Extra, A-Plus CriticalCare, A-Plus Early CriticalCare, A-Plus Multi CriticalCare, A-Plus GenNext, and A-Plus Venus & A-Plus VenusExtra.
Q. What does the anniversary bonus mean?
A. Some insurance companies provide an anniversary bonus on the policy anniversary date. That means, the insurance company increases the amount you are covered for without any increase in the premium.
Q. Is it allowed to increase or decrease the sum assured?
A. Not all insurance companies allow you to increase/decrease the sum assured after the policy has commenced. In some cases, you can buy multiple policies to get higher coverage based on the terms and conditions of the insurer.
Q. Can I cancel my life insurance policy?
A. Yes. You can cancel a commenced life insurance policy. However, it is recommended not to cancel as the insurance is a long-term investment. If you decide to cancel the policy within 15 days from the commencement date, you will receive a refund of the total premium paid minus the medical checkup cost. However, most insurance companies do not provide a refund.
Q. Can I get a tax relief on life insurance premiums?
A. The tax relief on life insurance premiums is subject to the discretion of the Inland Revenue Board. It also depends on the current Malaysian tax regulations.