What are the differences in a “standalone medical card” versus “Investment-Linked Plan” (as a rider)?
A standalone medical coverage only covers medical costs (which is the most important thing). However, medical coverage as part of a rider (i.e. an investment linked plan) would allow you to obtain CI coverage, payer waivers (i.e. no longer required to pay if the payer dies/suffers from TPD/CI) & allows for better medical coverage plans (e.g. higher annual/lifetime limits, more extensive coverage).**
**There are now standalone medical plans which are comparable to investment linked plans in terms of medical coverage.
If planning for the child’s coverage to be long-term, it may make sense to obtain better coverage with a medical coverage with life policy as it gives a significantly higher annual limit & an option for unlimited lifetime claims. This is especially in view of rising medical costs (~10% globally, 15% in Malaysia).
Recommendation
- Most importantly is to get a medical card with at least RM150 daily Room & Board (preferably RM200 above R&B). A standalone medical card may cost roughly 800 (girl) to 900 (boy) yearly, depending on age and amount of coverage.
- Depending on budget, obtaining a minimal amount of Life, TPD, CI coverage & payer waiver would be beneficial too for a baby/child. Costs are affordable from 150/mth to 300/mth (private hospital room). The policy would provide an increasing amount of coverage while costs remain low – because it was purchased when young – & it also has a cash value which can be withdrawn when needed.
Pro Tip
If you are an investor who knows what you’re doing, it would benefit you more to get a standalone medical plan. The excess cash (which would have been used to purchase a slightly more expensive investment-linked plan) can now be put into your investments instead. Over time, it would generate a much higher return than the cash value you have in your investment-linked plan.
If you aren’t an investor, get help from a professional.
