Insurance is a great way to safeguard your life, protect your assets and secure your health. Insurance comes in a range of categories and there are numerous product offerings in each category. Here, we will try and provide you with guidelines to choosing an insurance product in two important categories, health and life:
Life insurance provides financial payouts in contigencies like death, disability, retirement etc. When you die, get disabled or retire, you / your family members need money to replace the income lost; this is where life insurance comes in. Use the following tips to pick the right life insurance for your requirements:
Assess your needs – Life insurance is certainly required when you have a spouse, kids or ageing parents who depend upon you. Your life insurance should be able to cover funeral/medical expenses, replace lost income, help meet debt payments, mortgages and other bills, provide for children’s education and the like. Compute the amount of money your family might need to stay close to their current level of living while also taking care of their immediate and future financial needs and then plan for adequate insurance.
Decide upon the type of life insurance – There are various types of life insurance available. Term Insurance provides high coverage at a low cost but generally does not return any money. Whole Life and Endowment insurance provide life coverage and return to you the sum assured at the end of the policy term if you are alive and to your nominees otherwise. Unit linked insurance is a combination of protection and investment. Islamic insurance complies with the code of the Shariah.
Shop around – There are a number of life insurance providers. Evaluate both the product and the insurer before choosing one. Factors to evaluate the product – premium costs, amount of premium loading for smokers and those with medical conditions, availability of riders, lifelong coverage or choice of term, returns provided etc. To evaluate the insurer consider customer service and customer friendliness, ease of claims, track record etc.
Check out the fine print – Understand the terms, conditions and riders involved with the insurance policy you’ve shortlisted. Make sure that your insurance coverage includes special riot provisions and acts of nature like floods, volcanic eruptions and earthquakes if you live in such incident-prone zones.
Buying a health insurance policy will help you stay prepared for contigencies that require medical treatment. The introduction of the Jaminan Kesehatan Nasional (JKN), Indonesia’s universal healthcare system on the 1st of January 2014, though laudable still faces a number of challenges. And, even with the JKN fully implemented, you may find additional health cover very handy. Here’s how you can go about choosing a health policy:
Consider your needs – Before deciding upon a particular health insurance policy take your existing health needs and budget into consideration. If you or your family members do not have any health problems, a fairly “standard” policy may suffice. If, on the other hand, if you or your family members already have a medical condition or are pre-disposed to such, you could consider a more comprehensive medical policy.
Pre-existing conditions – If you already have a pre-existing medical condition, ensure that you declare this condition and that your healthcare policy provides cover for it. Health policies may also provide cover only after a certain waiting period (2 years, 4 years etc); so check for such conditions before you sign up.
Individual or family? – Do you want to go for individual policies for each of your family members or for one single policy that covers your entire family? In the case of the former, you may get higher cover, in the case of the latter you could save on costs. And, while you are at it, check for the definition of “family”.
Exclusions – Every healthcare policy comes with exclusions; understand the exclusions that apply to the policy you are looking at and how it could impact you given your current medical condition / requirements. Go through the fine print as well and if possible, consult an expert as to how such clauses could impact you.
Shop around – Evaluate the various healthcare products from different insurance service providers; check them out on costs, customer service, ease of claims, hospital network coverage, ease of renewal, facilities offered, types of expenses covered etc.
After you buy the policy – Make sure you meet the premium payments on time; some policies may have payment grace periods, but not all do. Also, check out the process for cashless treatment and for making claims.