Insurance is essential, but not everyone can afford it. Covid-19 has made us more aware of this. Microinsurance and micro takaful are products offered by insurance companies to help those who cannot afford regular insurance.
What Is Microinsurance/Microtakaful?
The purpose of microinsurance/micro takaful is to provide you or your family with a payout if you suffer an injury, illness, or worse, death. There are, however, lower premiums and coverage levels for microinsurance/micro takaful products. While these products don’t offer as many benefits as a standard insurance policy, at least you will have coverage in an emergency.
Who Is Eligible For Microinsurance/Microtakaful?
Microinsurance and micro takaful products exist to assist low-income earners. The low-income group is households earning less than RM4,000 per month, but insurance/takaful companies decide whether an applicant falls into this category.
Are There Any Microinsurance/Microtakaful Products Available?
Below is a list of some microinsurance/micro takaful products available:
|Type Of Insurance||Description|
|Coverage for accidental death and critical illness||In the case of death or a critical condition, your family will receive a payment.|
|Utility Bills and Credit Cards Coverage||You’ll be covered for your insured amount if you have insured your credit card or utility bills.|
|Travel Insurance||You will receive compensation if you incur medical bills or lose baggage or belongings while traveling.|
|Business Protection for SMEs||A business insurance policy provides you with compensation if anything happens to your business.|
|Daily Hospitalisation Allowance||In case of hospitalization, the policy will cover daily allowance.|
|Motorbike Insurance||This insurance policy covers your motorbike for theft, damage, and accidents.|
In Malaysia, microinsurance is still in its infancy, so few companies provide these products. Many insurance companies have begun offering these plans by partnering with mobile providers, such as Sun Life and Great Eastern. You can quickly sign up for and manage a microinsurance or micro takaful plan via your phone.
How Does It Work?
A large majority of these plans are either pay-as-you-go or short-term in nature. Short-term goals usually last six months, and renewal is a must. You would pay monthly for pay-as-you-go plans, and you could subscribe or unsubscribe at any time. You can resubscribe in the future by submitting another application on the website if you want to unsubscribe.
What Should You Check?
Make sure you know your coverage. You’ll also have a lower range when you pay lower premiums than with regular insurance or takaful. Based on your policy, you will only get coverage for the events described therein. Be sure you understand your scope.
2. Waiting Period
Microinsurance and micro takaful plans have the principle of minimizing the waiting period for claims. There is, however, a maximum waiting period of six months for most projects that cover natural death or disability. Therefore, you or your family member will have to wait up to six months for your benefits. So, before you think of canceling your insurance plan to save money, or if you don’t have any insurance, consider microinsurance and micro takaful. But bear in mind that losing your insurance with better coverage has disadvantages!