FIN 533 : INSURANCE PLANNING 1.

0 INTRODUCTION The basic purposes Amir buy an insurance policy is to ensure that his family is financially secured. For Amir, family comes first. He has to ensure that his family member needs are well taken care of and their future is secure even if he is no longer around. Besides his wife are not working. This family can be categorized as a young family with small children. So they need large amount of death protection also for disability protection. Life insurance is best cover that suit his family needs. Buying life insurance provides some financial security in time of hardship. If Amir passed away or having an accident that cause permanent disability, the money will be paid to his family. At the same time Amir will receive saving if he still live until maturity. Whole life policy are one of the policy that combines protection and saving.The money will be paid at the end of a specific period to their family or if Amir suffers total and permanent disability. If Amir is still living after the policy matures, he will get the money, otherwise, the money will be given to his nominee. We have did some survey to help Amir choose the right insurance policy that suit to his need. Next will be about the insurance policy that we think suit to Amir need. 2.0 TYPE OF INSURANCE POLICY 2.1 ETIQA TAKAFUL According to Etiqa Takaful Berhad these are the products that will suits the needs that Amir wants: 2.1.1 Premium Cash Refund An affordable life protection plan that refunds Amirs total premiums paid, which mean get solid life coverage for a very affordable entry. Furthermore Amir will get high coverage from premature Death and Total Permanent Disability with affordable premiums plus full refund of all the money that Amir have paid over the years (excluding loading and rider premium) at the end of Amir plan. The minimum monthly premium is RM 35 (subject to minimum collection premium) which the policy & premium payment term are 10, 15, 20, 25 or 30 years. The benefits from this plan are this plan provides both security and savings at low premiums; if no claims are made till maturity of the plan Amir will receive a refund of the total Premiums Paid which means Amir receive the total premium paid without interest, excluding loading and riders premium. The death benefit is paid in one lump sum to the family. Amir also can choose the flexible payment schemes which the options of annual, bi-annual, quarterly or monthly installments. 1

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2.1.2

Premium Life Income An insurance plan that provides annual income once turn to 55 years old, guaranteed for life, and Death and Total Permanent Disability benefits which provides life coverage to ensure the financial security of the loved one. Amir can get lifetime coverage and premiums start from as low as RM75 a month. The policy term will be held by 50 84 years old. The minimum guaranteed income are RM1, 200 when reach age 55 years old. With this plan as the main breadwinner of the family he can have the peace of mind knowing that the future financial security of loved ones are taken care of should anything untoward happen to him. The benefits from this plan are Death and Total Permanent Disability (TPD) benefits amounting to 20 times your annual income. Amir also can choose the flexible payment schemes which the options of annual, bi-annual, quarterly or monthly installments.

2.1.3

Hero15 A comprehensive plan for the breadwinner which provides Personal Accident coverage designed to take care of the most important thing in life which means family. This plan can get up to RM 206,500 in comprehensive accident coverage including coverage for childs education, settlement of the outstanding balance of the car loan and credit card, and payment of house utility expenses. The contribution starts from as low as 97 cents a day. The benefits from this program are assisting in children's education. This plan will pay RM20, 000 per child upon accidental death of the insured. Credit Card balance paid up to RM5, 000. The outstanding balance will be settled for the principal card holder (Amir), outstanding balance of Hire Purchase loan of any one of private motor vehicles will be settled in the event of accidental death up to RM30, 000 and house care benefit will pay out RM8, 000 to settle any outstanding house utilities that may have. Etiqa Takaful Berhad also gives Surplus Sharing which mean at the end of each financial year, the surplus (if any) from the Takaful Fund will be shared between Etiqa Takaful Berhad and all eligible participants in the ratio of 50:50.

FIN 533 : INSURANCE PLANNING Table 1 : Criteria Of The Insurance Policy That Offer By Etiqa Takaful COMPANY DETAILS TYPE Premium Cash Refund COVERAGE Savings & Security (Refund Total Premium Paid) Annual Income Start At Age 55 Death & Total Permanent Disability MATURITY COMPENSATION PREMIUM

10 - 30 Years

From RM 35/Month

Premium Life Income

Min. Income RM Start at Age 1,200 50 - 84 Covered Up to 20 Years Old Times of Annual Income.

From RM 75/ Month

enjoy up to:RM 100, 000 for Accidental Death RM150, 000 for Permanent and Other Disablement benefits RM 20, 000 per Child Education Fund RM 30, 000 for Settlement of Hire Purchase Loan RM 8, 000 for House Care Utilities RM 5, 000 for Settlement of Credit Card balance RM 10, 000 Infertility Compassionate Cash RM 100 per day Hospital Confinement Allowance and RM 20, 000 for Male Cancers.

ETIQA TAKAFUL

HERO15

Personal Accident

Depends to the Insurance Buyer

From RM 29.50/ Month

FIN 533 : INSURANCE PLANNING 2.2 PRUDENTIAL Prudential company suggest Amir to take Pru BSN Takaful policy the for his insurance coverage. Below are the details of this insurance policy. Table 2 : Criteria Of The Insurance Policy That Offer By PRUDENTIAL COMPANY DETAILS TYPE COVERAGE MATURITY COMPENSATION entitled to : RM60,000 (Pru Takaful Link (Life coverage) ) RM20,000 (Accident Death) Up to 65 Years Old takaful health (medical card with limit RM 1,000,000.00 for life time/ for ongoing treatment/hospital charge/ operation) entitled to : (Spouse) life coverage at amount of RM 60,000 (Pru Takaful Link (Life coverage) ) RM 2,000 (cpossionate benefit) RM 20,000 (Accident Death) + all saving in Amirs account. From RM 200/Month PREMIUM

PRUDENTIAL

PRU BSN TAKFUL

Permanently disable caused by accident or strok/serious illness that unable him to move and work.

Died

Lump Sump

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(Children) RM 25,000 Pru Takaful Link (Life coverage) ) + Until 25 Years Old Of Children RM 20,000 (Accident Death) + monthly insurance payment (RM100/ month) will be bearded by Prudential until 25years old

2.3

MCIS ZURICH Amir was suggested by insurance agent from MCIS Zurich. The policies plan recommended is Teras Malaysia Extra. Below is the criteria of this policy : Table 3 : Criteria of the Teras Malaysia Extra Insurance Policy

COMPANY

DETAILS TYPE COVERAGE MATURITY COMPENSATION Death benefit of 100% of the sum assured will be paid Additional 100% of the sum assured up to RM200,000.00 will be paid upon accidental death RM 50,000.00 (Miracle Plan Rider) RM 100.00/Day (Max : 45 Days/Year lifetime limit of 300 days) - Daily Hospitals Allowances PREMIUM

MCIS ZURICH

Teras Malaysia Extra

D e a t h & Accidental Death Permanent Disability

Up to 30 Years

RM 168.80/ Month

FIN 533 : INSURANCE PLANNING

Total permanent disability cover of 100% of the sum assured amounting RM100,000.00 On commencement of disability, premium payable will be waived A refund of RM51,480 upon maturity of the policy will be paid if Amir survives till end of term and has not made any Total Permanent Disability claim

3.0

CONCLUSIONS As a conclusion, we think that insurance policy from Etiqa Takaful Berhad is the most suit for Amir needs. It is the Hero15 plan. This policy are comprehensive plan which cover accident coverage including coverage for child education, settlement of the outstanding debt including car loan, credit card and payment of house utility expenses. In addition the premium which from RM29.50 per month are reasonable and suitable for Amirs family who are on tight budget but needs comprehensive protection for his family.

In addition this plan will pay immediately for HouseCare benefit for surviving family members such as to pay utility bills up to RM8, 000.00. (This will give extra time to Amir wifes to find the job for the living).Amir should not worry on child education because this plan will pay RM 20, 000.00 for his child education. Lastly Insurance Company background Etiqa Takaful which is reputable company, good financial stability and also good payment record.