Yesterday I had a meeting with a friend who seek for my advice with respect to some coverages offered by several insurance/takaful agents. He was offered medical plus life takaful policies with attractive benefits. The way I approached the matter was as follows:
1. First and foremost, I apologize to him should the questions I was going to pose will offend him. He said not a problem.
2. I asked him that if he dies what will be the outstanding liabilities look like.
3. He described several liabilities or loans nevertheless they are currently fully covered with some kind of insurance covers. For instance, the housing loan is fully covered with mortgage reducing term assurance. As for the new car loan, he confirmed that his wife ('widow') can manage accordingly using her existing income.
4. Next, I asked him pertaining his kids for their education expenses. Those are also taken care by existing education insurance plans appropriately.
5. Besides, he is also a member of the national retirement scheme fund or Employees Provident Fund (EPF) which 'guarantees' a handsomely amount of retirement benefits upon reaching 55. EPF also provides some death and permanent disability benefits prior to age 55.
6. Therefore, my professional and friendly advise to him was that he is not desperately need an additional life insurance cover via a new policy. In other words, it is optional depending on his budget availability.
Similarly, he does not need any additional medical cover as well as he is fully insured or covered by his existing employer.
