20th October 2022 - 2 min read
A survey by Zurich Malaysia has shown that 30% of working Malaysians in their prime financial planning age – between 25 to 40 years old – do not have any form of personal protection. Revealed in the Impact Of Pandemic On Protection study, it was also found that this situation is primarily caused by the public’s misconceptions and lack of understanding.
Even more worrying, Zurich noted that 16% of survey participants indicated that they do not plan to set aside any funds for insurance or takaful products. This is despite recent statistics from Bank Negara Malaysia (BNM) that noted that more than 75% of Malaysians find it difficult to raise RM1,000 of immediate cash in the event of emergencies. Additionally, the Employees Provident Fund (EPF) said that 6.62 million members under the age of 55 had savings of less than RM10,000 in their accounts.
Zurich further said that this “inaction” in obtaining personal protection is attributed to two key reasons: misconceptions and lack of information.
According to the insurer, 21% of survey respondents have the mistaken belief that insurance provided by employers is already sufficient to protect them during unfortunate events. Another 14% polled that insurance and takaful products are unnecessary, while 9% said that they have a bad perception of the products.
Meanwhile, 22% of survey participants noted that they still do not have enough information on insurance and takaful products despite initiatives taken by insurers and takaful operators to educate the public. “Although not necessarily the cause, this could have contributed to a lack of understanding (18%) on the purpose and benefit of insurance and takaful,” Zurich further noted in a statement. Another factor that also contributed to the lack of personal protection for survey participants within this age group is the inability to afford insurance (11%).
Given these findings, Zurich said that life insurance agents and takaful advisors have an important role in increasing awareness and ensuring understanding among the public. “This is critical to increasing the insurance and takaful penetration rate and reducing the protection gap towards a sustainable way of life,” it stated.
Zurich had commissioned the Impact Of Pandemic On Protection survey in late 2021, which had a sample size of 1,201 respondents. Respondents that fell into the age group of 25 to 40 years old make up 41% of the total sample size, equivalent to 491 individuals.
(Source: Zurich Malaysia)
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