Speaking of life insurance, it is quite straightforward that it covers human's life. However, what sort of coverage do an insurance company usually have specifically?
In general, there are four major types of insurance coverage:
1) Life coverage
Life coverage basically means the insurance company will pay an amount equal to the sum assured you purchase when death or Total Permanent Disability (TPD) occur. Although the definition of TPD differ among different insurance companies, broadly speaking, it covers the event:
i) Totally and permanently for the insured person to earn any wages; or
ii) Loss of two limbs (example: both arms, both legs, or one arm and one leg, totally loss of sight of both eyes) by amputation; or
iii) Loss of use of two limbs; or
iv) Totally and permanently cannot perform activities of daily living like dressing, bathing, eating, walking, etc.
2) Medical
Medical plans are quoted on the basis of Ward/Room rate per day. In general, a RM200 Room & Board coverage will entitle you to a coverage of maximum RM200 ward per day. However, the plans are subject to certain requirements and limits. This include how many days of entitlement of hospitalisation, the maximum amount that you are entitled to in a year (Annual Limit) and throughout your life (lifetime limit), outpatient treatment limit, co-insurance (where you have to pay a portion of the claim) and so on. Some other additional benefits might come along with the medical card, such as nursing care, kidney dialysis, cancer treatment etc.
3) Critical Illness/Dread Disease
Critical Illness insurance pays a lump sum of sum assured when the covered event occurs. In Malaysia, insurance companies cover 36 critical illness. Although the list of the critical illness is different from company to company, it generally has the illnesses such as below:
1 Heart Attack
2 Severe Cardiomyopathy
3 Stroke
4 Cancer
5 Parkinson’s Disease
6 End Stage Kidney Failure
7 End Stage Liver Failure
8 Fulminant Viral Hepatitis
9 End Stage Lung Disease
10 Major Organ / Bone Marrow Transplant
11 Major Head Trauma
12 Chronic Aplastic Anemia
13 Multiple Sclerosis
14 Muscular Dystrophy
15 Primary Pulmonary Arterial
16 Benign Brain Tumour Hypertension
17 Blindness / Total Loss Of Sight
18 Encephalitis
19 Heart Valve Surgery
20 Angioplasty And Other Invasive Treatments For Major Coronary Artery Disease*
21 Deafness / Total Loss Of Hearing
22 Brain Surgery
23 Surgery To Aorta
24 Bacterial Meningitis
25 Loss of Speech
26 Other Serious Coronary Artery Disease
27 Alzheimer’s Disease /
28 Loss Of Independent Existence Irreversible Organic Degenerative Brain Disorders
29 Major Burns
30 Systemic Lupus Erythematosus (SLE) with Lupus Nephritis
31 Coma
32 Full Blown AIDS
33 Motor Neuron Disease
34 Coronary Artery By-Pass Surgery
35 HIV Due To Blood Transfusion
36 Paralysis / Paraplegia
Bear in mind that, the sum assured will usually only be paid out if the illness is at the final stage. The recent development on the critical illness policies is that certain plans will give out the sum assured on a staggered basis according to the severity of the illness.
4) Personal Accident (PA)
A Personal Accident coverage generally include the accidental death and TPD benefits. Some might have daily hospitalisation cash benefit when the injuries are due to accidents.
In general, there are four major types of insurance coverage:
1) Life coverage
Life coverage basically means the insurance company will pay an amount equal to the sum assured you purchase when death or Total Permanent Disability (TPD) occur. Although the definition of TPD differ among different insurance companies, broadly speaking, it covers the event:
i) Totally and permanently for the insured person to earn any wages; or
ii) Loss of two limbs (example: both arms, both legs, or one arm and one leg, totally loss of sight of both eyes) by amputation; or
iii) Loss of use of two limbs; or
iv) Totally and permanently cannot perform activities of daily living like dressing, bathing, eating, walking, etc.
2) Medical
Medical plans are quoted on the basis of Ward/Room rate per day. In general, a RM200 Room & Board coverage will entitle you to a coverage of maximum RM200 ward per day. However, the plans are subject to certain requirements and limits. This include how many days of entitlement of hospitalisation, the maximum amount that you are entitled to in a year (Annual Limit) and throughout your life (lifetime limit), outpatient treatment limit, co-insurance (where you have to pay a portion of the claim) and so on. Some other additional benefits might come along with the medical card, such as nursing care, kidney dialysis, cancer treatment etc.
3) Critical Illness/Dread Disease
Critical Illness insurance pays a lump sum of sum assured when the covered event occurs. In Malaysia, insurance companies cover 36 critical illness. Although the list of the critical illness is different from company to company, it generally has the illnesses such as below:
1 Heart Attack
2 Severe Cardiomyopathy
3 Stroke
4 Cancer
5 Parkinson’s Disease
6 End Stage Kidney Failure
7 End Stage Liver Failure
8 Fulminant Viral Hepatitis
9 End Stage Lung Disease
10 Major Organ / Bone Marrow Transplant
11 Major Head Trauma
12 Chronic Aplastic Anemia
13 Multiple Sclerosis
14 Muscular Dystrophy
15 Primary Pulmonary Arterial
16 Benign Brain Tumour Hypertension
17 Blindness / Total Loss Of Sight
18 Encephalitis
19 Heart Valve Surgery
20 Angioplasty And Other Invasive Treatments For Major Coronary Artery Disease*
21 Deafness / Total Loss Of Hearing
22 Brain Surgery
23 Surgery To Aorta
24 Bacterial Meningitis
25 Loss of Speech
26 Other Serious Coronary Artery Disease
27 Alzheimer’s Disease /
28 Loss Of Independent Existence Irreversible Organic Degenerative Brain Disorders
29 Major Burns
30 Systemic Lupus Erythematosus (SLE) with Lupus Nephritis
31 Coma
32 Full Blown AIDS
33 Motor Neuron Disease
34 Coronary Artery By-Pass Surgery
35 HIV Due To Blood Transfusion
36 Paralysis / Paraplegia
Bear in mind that, the sum assured will usually only be paid out if the illness is at the final stage. The recent development on the critical illness policies is that certain plans will give out the sum assured on a staggered basis according to the severity of the illness.
4) Personal Accident (PA)
A Personal Accident coverage generally include the accidental death and TPD benefits. Some might have daily hospitalisation cash benefit when the injuries are due to accidents.