Insurance to the most part of developing countries’ citizens are a hassle and burden than a need or necessity. But as wealth grows in these developing countries, the lower end merchants, medium wage office workers and the educated become more aware of the importance of insurance in their lives.
Most insurers nowadays tend to move towards the investment side with more and more pushing their agents to canvas for investment linked plans, that’s mainly because when its an investment linked plan, their margin to profit from the consumer is greater than with regular Whole Life or Endowment plans. But in fact the main issue that still stands out for people in these developing countries should not be about investments or trying to grow wealth at the moment but should still be focused more on the protection aspect of insurance.
Insurance for the most part should still be taken up because of the Income Protection aspect and not for its future value, but being cautious by nature we tend to think of pure protection ( Term Insurance ) as a waste of money when if nothing happens you get nothing in return. This is where there needs to be a mix or hybrid of plans to be sold to the consumers, being a mix of either Whole Life and Term Insurance, or Endowment and Term Insurance. Both of which will in the end have a better balance of savings and protection for the customer.
The start of a good balanced plan begins with the Medical Insurance taken by the customer, in certain countries the Medical Expenditure side is well covered by the countries’ government’s plan or by the company that they work for. But for others the people themselves still have to take a considerable burden when it comes to Hospital Bills and Long Term Illness care (Diabetes, Hypertension, Kidney Failure, etc). Here in turn is the 1st Basic Insurance that we all need, be it from your country/company/self. 2nd is Protection on Death and being Total and Permanently Disabled or Disability Insurance. And lastly is Critical Illness protection, as cancer and heart diseases is more and more common place in our society, and even though medical advances increase our chance of surviving these illnesses, it has also driven the cost of health care to tremendous heights.
So when you do feel that it is time to purchase or enquire about the different types of insurance, be sure to make these 3 your top priority.