5 Common Myths Claiming You Don’t Need Insurance



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Most of us believe life insurance gives us “peace of mind” but most people still don’t have it as their top priority.

This could be due to their confusion over different types of insurance and what they cover.  Some people just forego getting insurance coverage because they believe they can’t afford it and they have other more immediate financial priorities.

Whatever the reasons for not getting the right coverage for yourself and your loved ones, don’t let these five common myths be the reason.

“I’m young and healthy. I don’t need medical coverage?”

According to the Health Ministry’s statistics, 11.6 million of the 16 million adults in Malaysia are sick with a non-communicable disease like diabetes, hypertension or cancer.

Malaysia also has the most overweight and obese people in Asia. 54% of the adult population is either obese or overweight, compared to only 24.1% 10 years ago. As a result, seven out of 10 Malaysian adults suffer from chronic diseases.

With the daunting statistics, you just don’t know which side of that statistic you’ll end up on.

“I have a stable income, why would I need to pay an insurance company to save money?” 

Your income may be able to cover your day-to-day expenses, but there are various things we need to save for as we go through different stages in life. One thing that everyone should save for as early as possible is their retirement.

And if you are a parent, you may even need to save for your child’s education fund and it may not be able to get your child where he or she wants to be by just saving cash in your savings account.

Historically, education inflation is at 5% rate, and if you are planning to send your child to the US, you will need to save about RM1,449 every month at 7% interest rate.

Saving cash from your income every month in a savings account (0.25%), you will need to save RM2,479 a month to be able to save up RM484,832!

With that large sum as an expense coming up, you definitely need to prepare for your retirement or if something were to happen to you before you are able to save this amount, this is where life insurance comes in.

“I can rely on SOCSO if I get into an accident.” 

Most accidents that may cause long-term disabilities may not even happen at work, or are work-related. And if it’s not work-related, you can forget about Social Security Organisation (SOCSO), as it only benefits employees who are involved in a work-related accident, commuting accident or has an occupational disease, where they will be entitled to free medical treatment at SOCSO panel clinics, government clinics and government hospitals.

If you have your own medical insurance, you can choose from a wider range of hospitals and clinics, and most importantly, it covers non-work-related accidents (like getting injured in your nightly game of futsal!)

“I have disability coverage through work.”

Insurance ultimately protects your paycheck. If you become injured or ill and can’t work, your insurance pays you a portion of your salary until you can return to work.

According to AIA’s record in 2013, 34 claims were made for total permanent disability and 102 cases on personal accidents, with 67.6% out of these claims by policyholders between the ages of 18 and 50, below the retirement age. Without insurance to replace a person’s income, disability may render him or her jobless and a financial burden to his or her family.

If you are still counting on the government’s benefits, you will be able to get an allowance equivalent to 40% of permanent disability benefits or invalidity pension and is subject to a maximum rate of RM500 per month. That is, if your injury is work-related.

If not, you will need to get a job, to be subsidised with an extra RM300 a month. Combined, your monthly income would be just slightly above minimum wage (depending on the salary you may be able to get).

“I don’t need life insurance because I don’t have any dependents.”

Most people think only people with dependents, such as a spouse and children, need life coverage. But the truth is, it is aptly named because everyone alive should get life coverage.

Even if you’re not married and don’t have children, you should still consider getting life insurance because you wouldn’t want to burden your elderly parents with expenses such as funeral arrangements and any potential debts (think properties and cars) that you may leave behind.

In addition to that, it’s something you should consider getting early because you won’t be alone forever. The earlier you get it, the cheaper it is overall!

Life and medical insurance, like all insurance, are the types of things you buy before you need it. The best time to purchase life and medical insurance is when you’re young and healthy so build up your coverage early. And even though you may think you don’t need it now there is always a risk of something happening to you in the immediate future.

Insurance gives you the peace of mind to carry on with your life knowing that you’ll be financially covered no matter what!


Get yourself protected from RM150 per month and learn how AIA’s GenNext Solution provides you with cash allowance in the event of an accident, and lump sum benefit for critical illnesses.

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