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An insurance plan was probably the last thing on your mind when you received your very first paycheck. After all, being insured isn’t really a necessity since you’re neither old nor in need of medical care, right?

 

Well, we hate to break it to you, but you’ve been sold a lie. A myth, to be exact. To avoid making a costly mistake, it’s always wise to make financial decisions based on nothing but cold, hard facts. So, let’s take a look at the top four myths about insurance in Malaysia and why they’ve been undeniably busted. 

 

Myth: I don’t need insurance in my 20s

You wouldn’t believe how often people get into accidents that result in serious illnesses, permanent disability, or even death. Malaysia saw 566,760 road accidents during the pandemic alone, with over 5,000 fatalities*. If that wasn’t alarming enough, the SOCSO mentioned how young people were usually the victims of these fatal accidents**.

 

While this fact is an unfortunate reality, there are some steps that we can do to secure our finances if we ever find ourselves in unexpected situations. One of the steps is, of course, by getting insurance.

 

The benefit of being insured is that you can still be financially protected if you are unable to work after an accident or injury. Some comprehensive insurance plans in Malaysia even offer a weekly disability income benefit to those who meet the requirements. Buying your insurance in your 20s may also be generally cheaper, which brings us to the next myth….

Myth: Insurance is not affordable on a fresh grad salary

Well, we’re here to bust this myth! Your insurance policies need not cost 500, 600 or thousands of ringgits a month. In fact, Malaysia is blessed with plenty of insurance options to suit your budget and needs.

 

Most insurance agents also tend to ask about your affordability and your insurance needs – or you can simply compare (or buy) the plans online as a start!

 

What’s more, there are tax reliefs on insurance premiums*** to lighten your financial load. Pensionable public servants can claim tax relief of up to RM7,000 on life insurance premiums. For non-public servants, you are entitled to a life insurance tax relief of up to RM3,000. 

Myth: Workplace medical insurance is enough

So, your company’s group insurance offers an excellent hospitalisation plan. That’s fantastic! But don’t forget that workplace medical insurance only covers employees. If you were to change your job, start your own venture or simply take time off work, you will unfortunately lose this benefit.

 

Some workplace insurance also offers relatively low coverage. Should your hospital stay rack up a hefty bill (and they usually do), you might have to dig into your savings to cover the balance.

 

All these reasons are why you should always have a reliable personal health insurance policy on top of your workplace group insurance for added security. 

Myth: Single people don’t need insurance

Perhaps you’re waiting for wedding bells to ring before you pick out an insurance plan. It sounds good and all, but you forget one thing. Your bills and debts like student loans and car loans fall to your next of kin when you pass on.

One way to safeguard your family is to consider buying a life insurance policy. Even a basic insurance plan with a death benefit can potentially cover all of your financial debt.

 

On a lighter note, most whole Life insurance plans can also help you build wealth through investments. They could help you buy your dream home, put your future children through university, and ensure a comfortable retirement life with your spouse.

 

Since the amount invested takes time to mature, it makes sense to start earlier. So, cash in on your youth now because it literally pays to be young.

 

 

As you can see, the myths surrounding insurance result from nothing more than unfortunate misconceptions. Instead, there is overwhelming evidence that being insured young leads to more secure and comfortable life for you and your loved ones.

 

Want to find an insurance that suits your lifestyle? Find out what we offer here. If you liked this article, be sure to check out more helpful financial tips and guides here.

 

 

 

This article is for informational purposes only and CIMB does not make any representation and warranty as to the accuracy, completeness and fairness of any information contained in this article. As this article is general in nature, it is not intended to address the circumstances of any particular individual or entity. You are advised to consult a financial advisor or investment professional before making any decisions based on the information contained in this article. CIMB assumes no liability for any consequences arising from your reliance on the information presented here.

 

Source:

 

*https://www.thestar.com.my/news/nation/2021/10/16/over-5000-fatal-road-accidents-from-march-2020-to-oct-2021-says-bukit-aman

 

**https://www.nst.com.my/news/nation/2021/06/701892/malaysia-records-over-494-million-accidents-last-decade

 

***https://www.hasil.gov.my/en/individual/individual-life-cycle/how-to-declare-income/tax-reliefs/

#Insurance

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