Myths about getting life and health insurance

Many Filipinos believe that getting life or health insurance is unnecessary or a luxury you only pay for if you have extra money to spend. There are various reasons why they feel this way. For them, insurance is not a main consideration because of two big misconceptions: first, insurance is expensive, and second is that they don’t have to get one because their employers usually offer it.

Many Filipinos think that getting insurance is expensive and premiums (fee you pay on a scheduled basis) cost thousands of pesos each month. Having the “pang mayaman lang ‘yan” attitude is one of many reasons why insurance penetration in the Philippines remains low.

The cost of insurance is based on several factors: a person’s age, underlying health conditions, and capacity to pay. In most cases, insurance costs are lower when one decides to have it early in life and when they are still healthy.

Insurance costs get higher when a person decides to get one at an older age, or has some known medical conditions. Still, the premium amount one should pay should be in line with how much the person is able to pay.

In recent years, insurance products have become more affordable – and are customized to suit your needs. These products are often offered through by companies that have innovated on ways to personalize insurance policies and offerings.

A life or health insurance doesn’t have to cost you an arm and a leg just to protect you from life’s uncertainties. So-called micro-insurance firms offer life insurance for as low as PHP 50 to PHP 500 monthly premium. Their offers might be small, like a PHP 2,000 per day hospitalization coverage, but that amount is small compared to the amount of money one has to pay a month, as well as the peace of mind.

Sadly, most medical emergency expenses today are paid out-of-pocket or in cash by many Filipinos because they don’t have insurance.

Another misconception, especially among Filipinos who are employed or are working, is that the health benefits they get from the companies they work with are enough to cover for unexpected events like a medical emergency. So, why spend more when your company pays for everything, right?

This would be true if all health benefits were the same. Keep in mind that not all companies offer the same insurance benefits – if they offer it at all. Some companies offer limited coverages or reimburse a small portion of the total amount (you spent during the emergency), whether it is for medical treatment or if the employee unfortunately passes.

If an employee’s medical needs go far beyond what the company offers, that person has to pay for the remainder. The cost of medical expenses are going to get higher and this could put more financial strain on an employee, especially if the medical condition requires more extensive and expensive treatment.

Even if a company offers some insurance protection as part of their employee benefits, it is still wise to get life or health insurance to cover for medical emergencies and personal accidents.

It’s wrong to think that you don’t need insurance because you can’t afford it or that your company is already offering something like it. There are costs involved in getting insured and all of them are to your benefit. Having insurance gives you the peace of mind that whatever may happen, your family will be financially prepared to deal with it.