Insurance is now an essential part of financial planning. With insurance, losses caused by all life risks can be diverted.
Maybe some people believe, saving can be considered as one of many efforts in providing emergency funds if there are undesirable things happening in the future. However, are you willing to spend your savings to pay your medical treatment due to illnesses or accident that can cost a lot of money?
Hence, insurance is the right tool to complement your financial planning because insurance will bear any losses should there is a risk in the future. Your saving will remain safe and will not be used to pay for losses or costs incurred for a risk.
That way, insurance allows you to achieve your goals in financial planning, for example, buying a house, car, or just traveling. Even other valuable assets that you have will not be mortgaged to pay the bills due to the risks.
Choosing insurance, however, need to consider many things. First, avoid buying protection that you don’t fully aware of the benefits. You have to know what kind of benefit the product offers, whether it fulfills your need and suit your budget.
The following are things to consider before choosing which insurance to buy:
1. Suit Your Needs
Make sure you choose the insurance that best suits your needs and financial capabilities. However, don't let the insurance you choose actually burdens your financial condition and interferes with the budget allocation determined.
You can also consult with an agent or representative of the insurance company you choose to get the best recommendations that suit your financial planning.
2. Examine the Policy Terms and Conditions
Before choosing the right insurance, you must understand all the terms and conditions listed in the policy. You can start from the benefits and protections offered, premium payments, to the claim process.
If you think that something is not following the agreement or the initial information that has been submitted, please immediately contact the insurance company for immediate cancellation or changes. This is to keep the benefits and insurance protection you choose in line with your expectations.
3. Look at the Reputation of the Insurance Company
The insurance company's reputation is an essential aspect to see how the company’s capability in overseeing your funds, whether they manage them properly or not. The most important thing is to check whether the insurance company is registered with the Financial Services Authority (OJK) and insurance associations or not.
Also, find out the insurance company's financial strength from the annual financial statement published in the media to avoid default on the claims you make. There's nothing wrong with looking at the credibility of how long the company has been operating, media coverage, and reviews on social media.
These are the tips on how to choose the right insurance. Given that insurance is a long-term investment, don't make any decision without careful consideration.
If you are still confused about which insurance to buy, our Sun Life Indonesia advisor team is ready to help you choose the insurance product that best suits your needs and financial planning.