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THE BASICS
Broadly speaking, there’s two categories of
insurance:
General insurance
Covers awide range of risks such as property
damage, car accidents, and unexpected
medical expenses during a trip overseas.
Life insurance
Covers most causes of death such as illness
and accidents depending on the policy.
Common types of insurance include life,
health, home, disability, travel and motor.
Which ones should you get? That depends
on your personal circumstances.
As a start, here’s some questions you may
want to consider:
)
Who/what are you trying to
protect? This could be your
health, home, family, car, etc.
)
Do you have loved ones
who financially depend on
you? How would they fare if
something happened to you?
)
Does your employer provide
insurance coverage?
)
Do you have debt or any
other major financial
commitments?
)
Howmuch of your income can
you put aside for insurance?
Will you still have enough for
emergencies?
This is just the tip of the iceberg. If you
need guidance, it’s best to see a financial
consultant. Thisway, you can pinpoint exactly
what you need and how you can achieve it.
If there’s a saying that can sum up what insurance is all about, it’s
“sediakan
payung sebelum hujan”.
It’s a Malay proverb commonly taught to schoolchildren not just to expand
our vocabulary, but also a lesson in life. You can plan everything perfectly but
sometimes, life throws us a curveball and catches us off guard. And in some
cases, it comes with a bill that has too many zeroes in it. Insurance serves as a
safety net in times of financial emergencies, so you don’t have to bear the entire
cost all by yourself.
BEFORE YOU SIGN
A quick checklist before you
commit to any policy:
List what you need
These are the things that you want covered
under the policy.
Shop around
Get quotes from different insurance
companies.
Check exclusions
Always ask what’s covered and what isn’t.
Check the costs
The premium is an obvious one but pay
attention to the excess, optional add-ons,
and sum insured too.
Read everything
The amount of text may be overwhelming
especially with all the legal jargon, but you
need to read each and every single page.
Know the terms and conditions. If you aren’t
sure, ask.
Be honest
Tell the truth and don’t leave out any
important details. Otherwise, your claim
may be turned down.
Don’t rush
Take your time to evaluate before you sign
that dotted line.
DO YOU REALLY NEED
INSURANCE?
If you drive, you likely already have motor
insurance (because if you don’t, you’d
be breaking the law here). Now think of
the road accidents you’ve seen and the
amount of money involved to settle these
things. Without insurance, the bills could be
astronomical.
The risk, no matter small, is always there.
Insurance isn’t just about expecting the
worst. It’s about being prepared for the
unexpected. The key is finding the right
insurance to manage these risks, and this
may require seeing a financial consultant.
You might never need it, and that’s a very
good thing. But if you do need it, you’ll be
glad your insurance company is there–like
an umbrella when it starts to rain.
GOOD TO KNOW…
Get familiar with some insurance terms
so you know what you’re getting.
Policy
The contract between you and an
insurance company.
Policyholder
The person who purchases the policy.
Premium
The amount of money you pay for your
policy.
Claim
A request to an insurance company for
coverage or compensation.
Sum insured
The maximum amount of money you can
get from your insurance company if you
make a claim.
Exclusion
Circumstances not covered by your
policy.
Extension
Optional additional coverage for your
policy.
Excess
The part of a claim you have to pay before
the insurance company covers the rest.
For example, if your policy excess is
BND1,000 and the claim costs BND3,000,
then you need to pay BND1,000 first. The
remaining BND2,000 will be paid by the
insurance company.
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