Sunday, January 22, 2017

Do We Need Medical Insurance?

Chinese New Year is around the corner, I believe most of the Chinese are getting ready their mood to enter ‘rooster’ year.

Unfortunately, one of my best friends who needs to bring his wife to fly to capital for a medical checkup this afternoon, where the local doctor suspected his wife has a lung issue upon inspection. It can be lung cancer, the worst case. His wife is not able to buy any medical insurance because she had a breast tumor 15 years ago.

Anyway, if affordable and possible, it is wiser to get a medical insurance. No doubt the insurance company is making big money from your policy. From the look at it, at least 50-60% of your installment will be used to pay up the agent’s commissions, ground staff wages, taxes, processing fees, etc. The rests I suspect they will used for investment diversification in hope to get higher return.

Remember we always hear insurance agent said, you will get XXX% return upon XX years? Or you do not have to pay the installment after XX years, the endowment itself it will be to sustain? Yes, it is possible, but chances are getting lower and lower in the near future. Why? Because the investment return is getting averagely lower from the market. Just look at mutual funds & KLCI index return, then you know what I talk about.

Anyway, why we need to insure with medical insurance? There’s a few benefits of doing so, even though we reluctant to let insurance company take our hard earn money every month and year.

1.       General hospital? – Yes, you can still go to general hospital, but free stuff is not always what you expected. I remembered my father did his heart bypass twice, he has to make appointments and queue, for months. In fact, his situation is not able to wait further, but he has no choice because there are just too many patients quieting for their appointment. So the alternative will be private hospital, which can serve you almost immediately, depending on which hospital you are visiting. Then it come to cost.

2. Medical treatment expenses – A medical operation will cost how much nowadays? For my father’s CAGB case, it costs around RM25K-35K. It’s not a small amount. The rich is not going to pay for it using their own savings, then what do they use?

3. Emergency funding – Most of the medical treatments are drop by suddenly, just like my best friend’s case. He is ready to spend tens of thousands of dollars for inspection and treatment if necessary. If one has not enough savings then how? Where to find the emergency fund at this last minute? General hospital is the only hope? 

4. Peace of mind – Once you got the medical insured, you can have a peace of mind. Because if anything happen to you, at least most of the expenses will be covered by the insurance company (provided you buy the right plan).

I’m not an insurance agent, but my experience tells me that it is wiser to get one which suit your affordability and need, the earlier the better. Once you exceed 35 years old, it is getting very expensive, because the risk of hitting the treatment and medical costs in the future are comparatively higher.

For which medical plan to get, do consult the right agent. Please make sure the agent is experience and helpful, not those just want to get commission and then disappear. Please avoid pretty young lady or part-time agent, they cannot help much, trust me. If you do, please make sure they introduce their 
manager to you. And please do not be greedy, subscribe the plan that you can afford to pay. The insurance agent may try to up sell what you need!

Happy Rooster Year, folks!

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