Human-like us knows how to manage risk since the ancient time. We resided in the cave to protect ourselves from natural disasters and wild animals. We built shields to protect us from sharp fangs and weapons. We installed barbwires or security alarms at our residents to buy time to escape or protect ourselves. Eventually, those risk management have developed into today’s business of insurance.

Nowadays, to do life insurance is neither easy nor difficult. More than that, there are many types of insurance to choose from that one could not decide which insurance they should go for. To get a clearer picture of managing risk by insurance, let us begin with the popular questions people have on insurance.

1. Which insurance should we go for?

We cannot compare different types of insurance to one another. What we can do is to ask ourselves on which aspects of our lives that we want insurance for such as health, family assurance, or stability after retirement. After that, we look for insurance that matches our needs. We might ask the sales representative to do a summary of the benefits of the insurance and compare them to get a better idea of the insurance we would choose.

2. If we already have employee welfare, do we have to buy health insurance?

The answer to this question is if we want health insurance for when we are sick, it is best to get one for ourselves. This is because employee welfare does not cover all the way to after the retirement period which is the time we tend to need it the most. Personal insurance can also be used together with employee welfare will increase medical expenses coverage. We should get the insurance while we are still healthy so that there will be no exemption on the illness that has been found before getting the insurance. Also, we should get health insurance together with insurance that will protect us until our retirement days like whole life insurance. Try not to get the insurance with short term protection because health insurance will expire as fast. It is also not recommended to get single package health insurance as, even though the premium is lower, the chance of being rejected in continuation is high.

3. Which type of insurance should we buy for tax reduction?

We should buy insurance that meets our long-term demand and look at benefits in tax reduction as a bonus. If we buy insurance for the sole purpose of tax reduction, we will not get the benefit of insurance fully and many might forget about their ability to pay insurance premiums, resulting in a loss. This is because we might not be able to afford premiums and stop buying insurance before a 10-year contract (according to the condition of tax exemption), we will then have to return money from tax reduction and pay more money to the Revenue Department.


Some insurance policies cannot be used for tax reduction because there is a higher return than what stated in the law or a shorter period of insurance. Therefore, if we are using insurance for tax reduction, we have to enquire if the insurance policy fits for tax reduction and we should choose the insurance that can reduce tax for many years to completely meet our demand on tax reduction.

4. Why is our insurance not as good as others?
 

“The grasses in others’ garden is always greener than ours.” This phrase automatically pops up when this question is asked. Why is your insurance better than mine? Why can you claim and I cannot? Why do they get return money and I don’t? This is simply because there are many types of insurance and different types have different details depending on the risk management they specify.


For example, Eak wants to have health insurance to ease his burden if he needs to hospitalize but he does not earn much. To answer to his demand to cover as many medical expenses as possible, the insurance sales representative does not recommend daily compensation in annual premiums because it is not necessary. They will then focus on the benefit of room fees and medical fees. If Eak has to hospitalize, he can only claim the amount he pays for insurance but not daily compensation. Apart from that, there are many more factors that make insurance of each people different such as age, gender, profession, the sum assured, or even lifestyle.

5. If a family member has a history of high blood pressure, diabetes, or cancer, will the health insurance be affected?

Health insurance is personal. If we do not have those diseases before getting insurance, we can rest assured. Except the insurance company determines that we might have a tendency to have medical conditions such as being overweight or have a medical history. We will have to do additional medical examination according to the company requirement and the examination fees will mostly be responsible by the insured. There might be an exemption, for example, if nothing is found after examination and insurance can be issued, an insurance company might pay the medical examination fees for us if the financial amount of our insurance is under the terms and conditions.
 

6. If we have a medical history and have undergone surgery, will we be able to get health insurance?
 

Anybody who is looking for health insurance in the day that you have a medical condition, have undergone surgery, or have been diagnosed with a medical condition, do not lose hope. We can still provide real information for the insurance company to consider first. An insurance company may ask us to do additional health check-up or ask for medical history. The results could vary as follow:

• Accepted as normal, which is considered very lucky.
• Accepted under the condition that higher premiums have to be paid. This is still considered good enough as we are protected like healthy people.
• Accepted under the condition that illnesses found prior will not be covered. If the result came out this way, it is still good as we are protected in other illnesses.
• Rejected. This is quite unlucky, but if we look after ourselves and recovered, we might be able to get health insurance in the future.

7. How different are endowment insurance and bank deposit?

Bank deposit is the money in a bank that can be withdrawn when needed. However, endowment insurance is the “savings” that protect lives. If it is canceled before the designated time, capital might be lost. However, if it can be long-term saved according to the goal of insurance with the same amount of interest and the same duration, endowment insurance will allow benefit from savings.

8. Can we cancel the insurance policy?

Once the insurance policy is received, we should immediately check through the detail and condition. Any point that does not go according to the agreement, we do not have to sign an acknowledgment or if we change our mind, we have to return the insurance policy to the insurance company within 15 days from the day we receive the insurance policy. The company will then return the remaining premiums after medical examination fees deduction (if have) and company expense deduction of 500 baht per page.

In case that the insurance sales representative does not come to hand the insurance policy personally, we can send an email to customer service because email is black and white and there are dates and times stated as evidence.

9. How much should the premiums be?

The main reason people cancel the insurance policy is that they could not afford it. Before getting insurance, thus, we should think about our financial status. The recommended rate of insurance premiums would be at 10% - 15% of annual income. For example, we earn 15 000 baht monthly. Our annual income would be 180 000 baht. This means the number of insurance premiums that we can afford would be 18 000 – 27 000 baht per year. Also, do not forget to take other debts into account.

10. What should we do if we cannot afford insurance premiums anymore?
 

Every insurance policy will have 3 solutions for those who cannot afford insurance premiums anymore which are:

1. Expropriation of insurance policy (cancel the insurance policy). This solution will result in the termination of protection and the insured will received the money back as stated in the expropriation of insurance policy table that they hold onto.
   
2. Expropriation of insurance policy (cancel the insurance policy). This solution will result in the termination of protection and the insured will received the money back as stated in the expropriation of insurance policy table that they hold onto.
   
3. ·Extension of time. This solution will allow the same amount of insurance, but the duration it covers will shorten. This can be seen on the table in the insurance policy.

Extension of time. This solution will allow the same amount of insurance, but the duration it covers will shorten. This can be seen on the table in the insurance policy.