Scam Thrives on Greed

The prospect of making easy money by working from the comfort of your home is a dream come true to anybody. Just think about it; no more traffic woes, no more hassle of catching the bus or train on time, no more stress of getting a cab to agree to take you to your work place and home, etc.

So when work-at-home business opportunities "knock" on your door offering you the chance to become financially independent or some extra income, most would jump at the opportunity, especially in these hard times. But beware. The Internet today is brimming with a variety of cyber scams from multi-level marketing schemes, selling cosmetics, investments, health care, diet plans, diet pills, energy boosters, to anything that is part of the most current craze.

To entice people into the scam, these Internet sites utilise headings such as "make money now", "Earn Cash in a few hours," and similar hoopla. Some even try to make themselves look more legit and convincing by cautioning you about the various scams.

The basic rule is, if it sounds too good to be true, then it is likely to be a scam. But in spite of so many warnings by Bank Negara, other government bodies and NGOs, many people continue to fall for these "Get-Rich-Quick" schemes.  According to law enforcement agencies, the number of scams has risen by 27 per cent this year alone.

Just stop and think about it for a moment. If it is so easy to get rich by just sitting at home in your pajamas, the world would finally be ridding itself of poverty. Two people have learnt this the hard way.

Taxi driver Rama, 33, ended up losing about RM30,000 after “investing” in a scheme which promised exceptionally attractive returns. A friend had persuaded him to part with the money to be his "down line", promising him returns of up to fifty per cent within 30 days with a Mini car to boot.

All he had to do was to write out a cash cheque of RM30,000 and get three down lines to part with RM2,000 each. Rama found the offer too good to resist. As in any scams, those recruited would be given a large return as promised on their initial investment, thereby motivating them to "invest" more.

Certain scams are specifically fashioned to take advantage of the way the Internet operates. Like in the case of retired teacher Ms Chong. Chong got an email message declaring she had won a foreign lottery or an online sweepstake from an American bank amounting to US$30,000, but in order for her to claim her supposed winnings, she had to pay US$80 for the processing fee via a wire transfer.

"I did precisely what they requested and that was the last I heard from them," said Chong, who a few weeks later noticed that an additional RM10,000 was wired from her account to the said bank without her knowledge. Chong lodged a police report but the authorities couldn't do much because "no such bank" existed. There are many reports of people getting ripped off and left with nothing but the sad experience to share.

There are also numerous Internet scams that happened without the victims even realizing it. It is only when their bank or credit card statements arrived that they found out that they had been cheated. There are, however, several ways to protect yourself from Internet scams. They are simple but essential precautions you can take because you often cannot be sure exactly who you are dealing with on the Internet.

How you access the Internet can also make a difference. But if you take the right measures, the likelihood of being scammed can be significantly reduced. You need to protect yourself by using antivirus programmes. Never leave your personal data on unknown sites.

Do not download anything dubious. Don't simply click on unknown links or suspected spam emails. Never open any email attachments if you have any doubts about the sender. Do not "unsubscribe" a spam email especially if the spam email has an "unsubscribe" link.

And lastly, never fall for any outwardly eye-catching offers, especially if they promise easy money. The online scams know no national borders or boundaries; they adhere to no investigative jurisdictions.

Nothing is easy in life and so, if you receive offers that sound too good to be true, bear in mind that if you have to pay, it's a purchase, not a prize.

Malaysian Underinsured

Many Malaysian households are underinsured which will result in a family not being able to sustain its current lifestyle upon the death of the breadwinner, a Life Insurance Association of Malaysia (LIAM) study revealed.

Its president Vincent Kwo said the “2012/2013 Protection Gap Study”, commissioned by LIAM, examined the potential mortality gap (under insurance) among Malaysian families in 2012 whose main wage earners were either covered by life and medical insurance, or uninsured under either policy. The mortality protection gap suggests the difference between what people will get from life insurance coverage and the coverage they need after the death of the breadwinner.

The findings of study revealed that the average protection gap for families whose primary wage earner have both life and medical insurance was RM553,000 per family which means when the sole breadwinner of the family dies, they would need about RM553,000, to last for at least five years to sustain their current lifestyle and continue with their daily consumption.

The study also revealed that families whose breadwinners was covered by life policy only had a slightly higher gap, at RM642,000 per family. Meanwhile, the average protection gap for a family whose breadwinner is not covered by either life or medical insurance was largest, at about RM723,000 per family.

The average mortality gap for each member of a family was between RM100,000 to RM150,000, which was the average amount a person needs to sustain his spending or lifestyle for the next five years upon the death of the breadwinner.

Kwo said the study was based on the assumption that each household in Malaysia consists of five members (the parents and three children. It was also done on the basis that the income of the household was generated by one primary breadwinner).

He said an assumption was also made that the income of the household was generated by one primary breadwinner, adding that the true extent of the protection gap might be smaller if the spouse of the primary breadwinner was also employed.

Kwo noted that it was crucial to note the degree of under-insurance as the sudden loss of a main wage earner carries potentially damaging ’domino effect’ with dire financial consequences.

“It may result in the inability to pay off the mortgage, debts or children’s education,” he said, adding that the size of the protection gap was often a true reflection of the potential demand for life insurance coverage.

The findings also showed that families whose primary wage earner was not covered by either life insurance or medical insurance have the largest protection gap, hence buying life insurance would solve the problem.

The study also revealed that the insurance purchase among individuals below the age of 25 was not encouraging, although the premium rates for the age group was relatively favourable.

Kwo said proactive measures should be taken by the insurers and the policymakers to increase insurance awareness and to encourage insurance purchase among the Malaysian population to reduce protection gap.

“The results of this study are expected to spur the insurance industry to move forward in achieving the targeted penetration rate of 75 per cent by 2020 under the Economic Transformation Plan,” he said at the launch of the study in a hotel here, yesterday.

Effective Engagement

Don’t try to do to much — when planning your meeting, keep the agenda tight and focused. Most people struggle to deal with more than three things at a time. When items get more complex, less is more.

Stay on track — control the meeting and the people in it. It’s your meeting and your outcomes. Gently remind people to stay on track. move unrelated discussions to another forum

Only invite the people who need to be there — this one is sometimes hard especially when a challenging or contentious topic is being discussed. Set a price on inclusion to the meeting — an opinion paper, a presentation, some piece of work that means the price of entry is not free.

Look for signs of distraction — when you see distraction beginning to set in, refocus the meeting or call proceedings to a close. Continuing when you have lost your audience will only yield no result or the wrong result.

Buying Life From Store

Your trip to the store may soon include buying life insurance along with your gas and groceries if insurance companies embrace the new trend of using retail outlets to reach potential customers and boost stagnant sales.

Nearly one in five consumers (17%) would be willing to buy life insurance from a store, according to findings from the 2013 Insurance Barometer Study. It was conducted by the LIFE Foundation, a non-profit public education group funded by insurers, and LIMRA, a global research and consulting firm that tracks the life insurance industry.

Here is the breakdown by retail type, according to the percentage of consumers who said they'd buy life coverage in a store:

• Warehouse club stores - 11%
• Superstore - 7%
• Drug stores - 5%
• Supermarkets - 3%
• Convenience stores - 1%

Those consumers who were willing to purchase at a superstore cited perceptions such as "reasonable cost" (63%), "simple process" (44%), "convenient" (43%) and "no pressure to buy" (42%) as reasons for their interest.

"Although the percentage of consumers is not large, it may not need to be so in order to be a viable niche market for companies to pursue," says the report. "The growth of distribution-related strategic alliances between insurance companies and nontraditional industry participants will be a growing trend."

Insurers already sell health plans at warehouse club stores such as Costco, and pilots are in place for life insurance sales at select Wal-Mart stores.

Life insurance sales remain flat
Despite the burgeoning retail trend, purchasing life insurance in-person from a financial professional is still the most preferred way to buy for over half of consumers (53%), according to the report. The problem is that most people are not buying life insurance at all -- in-person or at stores -- even though they are aware of the need for it.

Consumers continue to acknowledge the need for life insurance, yet 95 million don't have coverage and just one-third of Americans have individually-owned life policies -- the lowest level in 50 years, according to the report.

"Life insurance has never been as inexpensive or easy to buy -- especially with the anticipated growth of online and nontraditional purchasing channels - yet millions of consumers continue to put off the decision," Marvin H. Feldman, president and CEO of the LIFE Foundation, said in a written statement.

The reasons for not buying life insurance haven't changed over the past three years of studies - perceived expense, other financial priorities, being unsure of the type or amount to buy, and simple procrastination all still top the list of barriers to purchasing coverage.
LIMRA data show that consumers often estimate the average yearly price of insurance to be double that of actual costs.

Life insurance research and purchase tips
For those who are in the market for life insurance, the Internet plays a prominent role both in research and purchasing. Over 8 in 10 consumers would use the Internet to conduct research about purchasing life insurance. Nearly 1 in 4 would prefer to purchase online as well, if given the option.

If you are unsure about how to buy life insurance, follow these tips:

• Analyze the financial needs of dependents that would be left behind. Consider income for your surviving family members, mortgage, auto and credit card debts and college tuition expenses that would need to be paid, in addition to funeral costs.
• Decide which type of policy best suits your needs. There are two basic types of life insurance policies -- term and permanent. Term life provides a death benefit without any investment or "cash value" component, is typically the least expensive and expires after the term -- typically 10, 20 or 30 years -- is over. Permanent life insurance does not have a set end-date, is more expensive and comes with a "cash value" account that typically involves a return-on-investment component that is not guaranteed.
• Gather life insurance quotes to compare rates as price can differ significantly for identical coverage offered by different insurance companies.
• Research the company's solvency by checking its financial stability rating with a ratings company such as A.M. Best. The rating indicates the insurer's ability to pay claims.

Group Insurance - Bad For Life

Group Insurance is a temporary insurance protection. It is always never there when you  need it most.

Your employer may not offer enough life insurance.
While basic employer-provided life insurance is low-cost or free, and you may be able to buy additional coverage at low rates, your policy’s face value still may not be high enough. If your premature death would be a financial burden to your spouse and/or children, you probably need coverage worth five to eight times your annual salary.

You’ll lose your coverage if your job situation changes.
As with health insurance, you don’t want gaps in your life insurance coverage, because you never know when you might need it. Most workers who get coverage through work don’t know where their life insurance will come from if they change jobs, are laid off, their employer goes out of business, or they switch from full-time to part-time status. You usually won’t be able to keep your policy in these scenarios. Lack of portability can be a problem if you aren’t going directly to another job with similar coverage and aren’t healthy enough to qualify for an individual policy. Some policies do allow you to convert your group policy to an individual one, but it will likely become much more expensive, as you’ll be converting your term policy to a costlier permanent policy. And if you’re losing your coverage because you were laid off, the premiums might be unaffordable.

Coverage gets tricky if your health declines.
Another problem arises if you’re leaving your job because of a health problem. If you relied solely or heavily upon group insurance, and then suffer a medical condition that forces you to leave your job, you may be losing your life insurance coverage just when your family is going to need it the most. At that point it would be too late to purchase your own policy at an affordable rate, if at all, depending on the medical condition.

Your plan doesn’t provide enough coverage for your spouse.
While your employer’s benefits package probably provides health insurance for your spouse, it won’t always provide life insurance for your spouse. Couples often assume that the family will only suffer economic hardship if the primary breadwinner dies. 

Employer-provided life insurance may not be your cheapest option.
Even if you can get all the life insurance you need for both you and your spouse through your employer, it’s a good idea to price shop to see if your employer’s supplemental insurance really offers the best value for the money. You’re more likely to find a better rate elsewhere the younger and healthier you are. Also, unlike the guaranteed level-premium term life insurance you can purchase individually, which costs you the same amount every year for as long as you have the policy, the policy provided by your employer tends to get more expensive as you age.

Solution
While there’s no reason not to take advantage of any free or inexpensive insurance your employer offers, it probably shouldn’t be your only source of life insurance, nor should most people rely heavily on the supplemental life insurance they can get through work. The solution to each of the problems described above is to purchase some or all of your life insurance directly through an individual policy.

The most affordable solution is to buy the most insurance you can afford at the youngest age, since, as you age, the chance of acquiring an illness goes up, and with illness comes more expensive premiums, if you can qualify at all.

The Bottom Line
You need enough life insurance to cover all your debts and support your dependents. “Enough” includes paying off your credit cards, car loans and mortgage, paying for your children’s education, and making sure your spouse will have the financial means to take care of him or herself and your children. In a time of grief, the last thing you want is to leave your loved ones with another major life upheaval such as having to change jobs or schools because of financial strain, so take a close look at whether the life insurance you’re getting through work is the best way to provide for your loved ones.

Good Policy - Stupid Implementation

Insurance policies are supposed to be a promise in black and white that ordinary men in the street purchase with the hope that, when disaster hits, there is sufficient fund to carry through one’s life.

If it fails to deliver, the policy is nothing but a worthless piece of paper. Few people would scrutinise the fine prints when deciding to purchase a policy. This is where many of us find ourselves in a dilemma when disaster really hits.

In November last year, I discovered that I have prostate cancer after doing a full health screening. On further diagnosis, the urological surgeon confirmed that it was an aggressive form of cancer. He suggested that I should avoid surgery at all cost, because radiotherapy and hormonal treatment is less invasive and will give an equally good outcome.

He could have performed the surgery himself and the medical insurance would have to pay for it. Instead, he suggested radiotherapy, which is concurred with the oncologist’s recommendation.
The decision was also medically sound, but after consulting my insurance company about the medical treatment, I was told that, while an operation can be covered up to RM400,000, the treatment package suggested by the oncologist is considered ‘Outpatient Treatment’.

Because of the advancement in medical technology, both hormonal treatment and radiotherapy does not require hospitalisation; therefore, the insurance company would not pay more than RM10,000 for a whole lifetime because the treatment recommended by the doctors is considered ‘outpatient treatment’.

I am not the only person who has been paying an annual premium of RM1,400 for my medical insurance the past 12 years, only to discover that it has a cap of RM10,000 (a whole lifetime) for outpatient treatment.

While waiting for my consultation, I overheard one other gentleman having the same problem that I was encountering. This is devastating, especially having trusted in the company enough to purchase life, medical and household insurance for myself.

I think it is unfair that the insurance company should determine the payment based on whether it requires hospitalisation or just outpatient treatment. They should allow the medical specialists to decide what’s best for the patient.

Because of the way how the policies are written, some doctors try to help their patients by creating reasons to hospitalise them. This is done at the expense of other patients who need the hospital bed.
There is no reason to blame the doctors and saying that they are unethical; it is the way the insurance companies have crafted their policies that make it a necessity for doctors to keep their patients in the ward. Why should the patient’s well-being be ‘governed’ by ridiculous clauses in the insurance policy?

Tell me, what treatment cost less than RM10,000 especially when it has to do with the Big C (Cancer)?  By setting a cap to ‘Outpatient Treatment’ using the fine prints, especially for anything to do with cancer treatment, is simply cruel.

In fact, I could have opted for surgery which would cost a lot more than radiotherapy and hormonal jabs. Why should insurance companies be so blind as not to see their folly?

Most lay people would not fully understand the implications of the fine prints until disaster hits. This is where the authorities such as Bank Negara, which governs the insurance industry, should seriously look into the lack of transparency in insurance policies sold in Malaysia.

Life Insurance For Generation X & Y

Life insurance is a subject that has all of the elements of a perfect storm for poor decision-making.

• It’s complicated.
• It’s boring.
• It can be expensive.
• It’s wrought with potential conflicts of interest.
• It deals with a subject we don’t want to confront.

Many people don’t purchase enough life insurance to cover their needs. Of those that do, many end up making critical mistakes and buying insurance that is not optimal.

According to the Life Insurance and Market Research Association, more than 30 million Generation X and Y households surveyed reported that they needed more life insurance in 2012. One-third of wives own no life insurance at all.

The same survey found that most of us believe life insurance gives people “peace of mind.” Of those who have had a positive experience with life insurance, 80 percent indicated that the life insurance industry plays a “critical role” after the death of a loved one.

The main reasons people don’t buy insurance is because they believe they can’t afford it and they have other financial priorities. However, the survey also showed that consumers seriously overestimate the cost of life insurance by as much as threefold.

12 percent couldn’t decide what type of life insurance to purchase, 10 percent were concerned about making the wrong decision and 8 percent simply gave up because of a lack of knowledge about insurance.

These basics might help you find your way through the insurance thicket:

1. Determine whether or not you need life insurance. Not everyone needs life insurance. If you are young and without dependents, you may not need life insurance. If you plan on having dependents, it can be a good idea to buy insurance when you are young. By doing so, you guarantee your insurability (as long as you continue to pay the premiums).

Don’t fall for the argument that you should buy insurance when you are young just to lock in a low premium. Premiums are determined by your age, gender and risk classification. You may no longer have a need for life insurance if you are older with no dependents, have saved enough to provide for the needs of yourself, your spouse or partner and don’t wish to leave a legacy.

2. Determine how much life insurance you need. There are two ways you can calculate how much insurance you need:

Income replacement: This approach considers your age and earnings. It generally produces a higher number than a needs-based approach. You start with your age and determine how many years of income you would need to replace in the event of your death. For example, if you are 40 years old, you might decide to buy insurance that would pay 15 or 20 times your yearly income. Some calculations using this approach take into consideration your projected after-tax earnings over your working years, factor in inflation and discount the results to present value. The basic problem with this approach is that it’s not very individualized.

Needs-based: This approach considers your particular situation and assesses the impact of your death on your dependents. Factors to consider include whether your spouse or partner would continue or start to work, the number of children you have, whether there is a mortgage you want to pay off and the cost of educating your children.

3. Determine the type of insurance you need. The two basic types of insurance are term and cash-value insurance (which is also referred to as permanent insurance).

Term insurance has no investment component. You just decide how much coverage you need and the period of time you want that coverage to remain in effect. You can obtain term insurance that has a level premium over the term of the policy. Term insurance has lower premiums than cash-value insurance. Many financial planners recommend buying term insurance and investing the difference between a term-insurance premium and a cash-value premium.

Unfortunately, most people spend the difference. Nevertheless, for those with young children, term insurance will provide the most coverage for the lowest premium. By the end of the term, your need for insurance may be reduced or eliminated.

Cash-value insurance is one of the most confusing subjects in personal finance. It can be an excellent product, but it’s difficult to understand. Some insurance salespeople use its complexity to their advantage and attempt to sell high-commission policies when other policies would be more suitable.

Considerations For Retirement

The most obvious use for life insurance is to help cover the costs related to the funeral of a recently deceased loved one and to help replace any income that person may have generated in their remaining living years.

 

This kind of consideration becomes especially important for anyone in retirement or nearing retirement age. There are several reasons that those in retirement, or approaching retirement, will want to carefully consider their life insurance options.

Consideration #1: Life Insurance for Sudden Death of a Partner
Life insurance is especially important for retirees who depend on multiple incomes to cover the bills.
For example, a couple which plans to enter retirement together, relying on both incomes in order to cover the necessary household bills, could be devastated by the sudden loss of either partner. Not only could the emotional toll be debilitating, affecting work and possibly productivity and earnings, but the sudden loss of an income would probably disrupt the entire household budget.
An adequate life insurance policy on both partners could never mitigate the emotional loss, but the
financial loss could be replaced or at least lessened.

Consideration #2: Life Insurance to Sustain Minor Dependents
More Americans than ever are having families later in life. If you are nearing retirement age and still have minor children or other dependents, holding a life insurance policy into retirement could be part of a strategy to ensure that they have the necessary financial resources should something happen to you.

Consideration #3: Life Insurance for Estate Planning
If you are the owner of a family farm, business or other property which could be subject to estate taxes, obtaining a life insurance policy could be an important means to keeping the asset in the family after your death.

If you do not have the liquid assets needed to cover any estate taxes after your death, the property could be in jeopardy. Tying a life insurance policy into the estate plan can help reduce the risk that the property will be lost in such a situation.

Consideration #4: Life Insurance as an Investment for Retirement
Life insurance can serve as a retirement investment which will presumably build value over time.
In a whole life policy the idea is that you pay premiums for a certain number of years – until the growth in the cash value of the plan nixes the need for additional premium payments.

When you enter into retirement you can withdraw cash from the policy in the form of a tax-free loan which never has to be repaid. There are many variables which may affect this outcome including if the portfolio does not perform as expected, if for some reason you are unable to continue to making premium payments or if you withdraw funds before retirement.

The decision of whether or not to hold a life insurance policy going into retirement will depend on your individual financial and familial situation.

Liberty Mutual Coming To Malaysia

Boston-based Liberty Mutual Insurance Group announced the company’s entry into Malaysia’s $4.6 billion non-life-insurance market with its planned acquisition of Uni.Asia Capital Sdn’s 68.09 percent stake in Uni.Asia General Insurance Berhad for about $113 million.

The transaction is subject to Malaysian regulatory approval and is expected to be completed by midsummer.

“The addition of Uni.Asia will allow Liberty Mutual to compete in Malaysia’s growing and profitable insurance market while providing a strategic complement to our existing operations in Southeast Asia,” said David H. Long, Liberty Mutual Insurance Group chief executive.

Liberty Mutual Insurance currently has an international presence in 29 countries.

Sanlam Is Coming

Zurich Insurance Group is engaged in discussions with South African financial services firm Sanlam to divest its 40% stake in MCIS Zurich Insurance.

In 2001, Zurich Insurance combined its Malaysian operations with MCIS to establish MCIS Zurich. The Swiss insurer purchased Malaysian Assurance Alliance (MAA) in September 2011.

The move comes after, Bank Negara Malaysia, the country's central bank, mandated that no foreign company can own more than one insurance operation in the country.

A Zurich-based official from Zurich Insurance was quoted by the news site as saying, "We are working with other stakeholders in MCIS Zurich to resolve the issue of Zurich's interest in two licences and are confident that the situation will be regularised well within the deadline that the central bank has given to us on this matter."

Health Insurance

A man hired by an employment agency to work in a manufacturing company for a living collapsed on the job one afternoon. As his colleagues at his work place were trying to resuscitate him, another worker attempted to call in the ambulance service to come and take him to the nearest hospital.

Slowly gaining consciousness, this worker who was soaked in water and struggling to talk heard the suggestion made by the coworker which he objected to it by waving his hand to give a no signal to the suggestion.

Few minutes after he gain consciousness and was asked whether he will like to take some days off to seek full medical attention to attain total health, again he said no saying “I want to work”.
Workers at the company who knew what happened were shocked as why he was still insisting to work after that near death experience but did not know exactly why he won’t take days off from work.

Couple of days after, this worker quit the job without giving anyone any reason for his no show at work. Later on it was found out that he was not covered by any health insurance policy for him to receive quality medical care which will cost him big therefore he has to find some flimsy excuse to cover up.

Health insurance is not a luxury but rather a necessity for every individual to sign and receive quality health care in his or her life time. Medical emergencies are becoming very expensive the world over and if one have a medical emergency without insurance finds himself with a crippling amount of debt and seemingly no way out of the debt.

Technology Reshape Insurers

The global insurance market is facing as much change in thenext five years as it has over the past 50, as technological advances drive transformation in the sector and shape customer expectations.

Eighty-six percent of 74 global insurance CEOs surveyed by PwC in the final quarter of 2013 pegged technological advances as the trend most likely to transform their businesses in the next 12 months.

More than 60% of insurance CEOs surveyed by PwC see the speed of technological change as a threat to their organisations. In addition to pursuing opportunities in developing markets, global insurance CEOs are looking for new avenues to expand market share in mature economies.

Globally, 47% of insurance CEOs view increasing share in existing markets as the most important opportunity for growth. This is followed by product and service innovation at 26%. In developed markets where insurance penetration is high, 72% are concerned about slow or negative growth.

The report highlights that insurance CEOs view the digital economy, social media, mobile devices, big data, and other technological developments as having an especially transformational impact on
their businesses.

Out of 1,344 business leaders surveyed globally in the annual CEO survey, 105 were from South Africa and fewer than 10 from the financial services sector.

3 Reasons For Life

Death isn’t a topic that many people like talking about, but if you’re financially responsible for others, it’s your responsibility and obligation to discuss it with the people in your care. An essential part of this is discussing life insurance, because coverage like that can help the others once you’re gone. Here are the three types of people who really need to consider life insurance.

Are You Married and With Children?

Kids are some of the most vulnerable people in our society, so if you’re a married parent, you should really consider life insurance. Married parents in particular need to think long and hard about taking out a policy because many feel that their families are invincible. The sad truth, however, is that accidents happen, and if one parent passes away, it can place immense pressure on the other to provide all of the support for the children. The sensible thing would therefore be to take out life insurance to ensure that you’re providing for your family once you’re gone. 

Are You a Single Parent or Carer?

Single parents are in a very similar situation, except there’s more impetus to invest in a good life insurance policy because your children are more dependent on you. Around 4 in 10 single parents don’t have life insurance, so if you’re one of them, you should think seriously about the future of your children and the quality of life they would have if you have or don’t have life insurance. So even if you’re feeling fighting fit, you shouldn’t write off life insurance.

Are You Single With Aging Parents?

At the moment, you might not be worrying about the health of your parents. If they’re still young and you’ve had no other real experience of caring for the elderly, you may not have the foresight to know that as your parents get older and older, they’re going to require more and more of your care and attention. This extra care comes at a cost, of course, and if the unfortunate situation where your parents outlive you occurs, life insurance could help you to provide the care they need while you’re not around. Not all single people need to worry about life insurance, but if you have parents who are reliant on you, it’s definitely worth your consideration.

AmAssurance Sold To MetLife

American insurer MetLife Inc is banking on AMMB Holdings Bhd’s insurance arm to expand its reach in Malaysia while eyeing the opportunity to establish itself and grow in Indonesia in the future.

MetLife International Holdings Inc (MetLife), a subsidiary of MetLife Inc, has agreed to buy 50% plus one share in AmLife Insurance Bhd and 50% minus one share in AmFamily Takaful Bhd (AmTakaful) for a total of RM812 million from AMMB.

The deal will see MetLife and Am- Life and AmTakaful entering into exclusive 20-year bancassurance and bancatakaful agreements for the distribution of life insurance and family takaful products through the distribution network of AMMB’s banking subsidiaries, AmBank (M) Bhd and AmIslamic Bank Bhd, across Malaysia.

In January last year, AMMB bought back a 30% stake in its two insurance divisions for RM245 million from Resolution Ltd, ending its partnership with the UK-based firm. A 10% stake in both companies should be priced at about RM82 million and a 50% stake in both companies should cost about RM410 million.

Nonetheless, a premium is always paid for exclusivity as evidenced by Khazanah Nasional Bhd partnering Canadian firm Sun Life Financial Inc in a RM1.8 billion deal to acquire 98% of CIMB Aviva Assurance Bhd, creating a new company called Sun Life Malaysia Assurance Bhd.

Sun Life paid more than Khazanah acknowledged with the difference in price being attributed to the extra consideration being paid to CIMB for a number of items, including a share in a strengthened bancassurance agreement with CIMB Bank Bhd.

Micro Insurance = Micro Commission

Micro insurance or micro agent was a channel in the insurance industry that was developed for deeper penetration of insurance into country with large low income group. However, with smaller ticket size coupled with low commissions, this channel has seen low participation from distributors.

Micro-insurance products, which offer coverage to low income households is a mechanism to penetrate rural areas. It is a general or life insurance policy with a low sum assured and low premium size per policy.

The main reason behind few sellers of micro-insurance policies could be low commissions. Data from insurance company disclosures showed that a majority of insurers do not have any micro-agents. A handful of life and general insurers have such agents.

Direct Insurer

Consumer generally have bad experiences after purchasing life insurance directly from life insurance. The majority of the purchase is done via online. Instead of turning to advice on insurance after a bad experience with direct insurance, most people end up thinking that it is not worth having life insurance because they have had a bitter experience.

Consumer are not comfortable about how direct insurance is sold at all because it is not underwritten at the time of sale. As a result - most people think they're covered when they might not be and because direct insurance companies do not ask about previous illnesses until claim time, clients find out that they are not covered when it is too late.

It is necessity to raise consumer awareness about the importance of getting life insurance through life insurance agents - but it is difficult for the agent - to match the direct insurance advertising campaigns.

Direct Life Insurers - are getting big coverage in morning television or evening television. There's a fair bit of money that goes into those and as an industry we can't match that. Life insurance companies with tied agency are struggling at the moment and that matching the direct insurance spending in advertising would force companies to increase premiums.

That would drive consumers even further away from advised insurance.

The life insurers that uses agent - need to find other ways to tell people they need proper advice. But is it working? No, people are still buying direct insurance in droves despite getting burnt when submitting claim.