Debunking Life Myth

Life insurance is just another pointless expense.

It costs too much.


It's throwing money away – I won't ever benefit from it.


These are some statements you might hear from life insurance sceptics. The thing is, in most cases they simply aren't true. We are all about debunking the myths holding you back from making better decisions with your money. So we're taking a look at the three biggest myths about this important – but often misunderstood.


I don't need life insurance just yet
Do you feel vulnerable? Probably not.


In fact, if you're still reasonably young and healthy, it can be easy to feel invincible. I'm sorry to have to say this, but none of us are. Research has shown that we're pretty bad at estimating how long we're going to live. We're also not great at estimating our vulnerability to health hazards. In a landmark study titled “Why it won't happen to me: perceptions of risk factors and susceptibility”, the psychologist Neil Weinstein found that respondents rated themselves significantly less likely than average to experience 25 health hazards, including certain types of cancer.


Even if you believe your risk to be smaller than average, the downside of that risk is enormous. If there are people depending on your contribution – whether or not you work full time – then being uninsured (or under-insured) could leave them facing a financial disaster. Unless you've got no dependents, mortgage or living expenses, your family probably does need you to have life insurance.
So here's how I'd sum up the reality that counters this myth:

• It's likely you're underestimating your risk
• The downside to that risk is potentially huge
• If the risk exists today, it's worth insuring today – it won't be noticeably bigger tomorrow

It's expensive
With a tiny sum of RM100 a month - most can start with a policy worth RM100,000 sum assured.
The good news is that it doesn't have to be. In fact, it's cheaper to get cover when you're still young and healthy – because your life expectancy is longer. Your 30s and 40s are when your financial responsibilities could peak, but it is still a highly affordable time to arrange cover.


You won't benefit from it
Along with making a will, it can be easy to put off sorting out life insurance because "it won't matter until after I'm gone". It's the ultimate procrastination – and it's also a big fat myth.


As well as the obvious benefit to your loved ones if you die unexpectedly, there are circumstances when you can effectively claim your payout while you're still alive. If you add critical illness insurance onto your policy, you can claim a payout if you're diagnosed with an illness like cancer, or suffer from conditions such as a heart attack or stroke.