Insurance, Is It Always The More The Merrier?

Do multiple policies really provide sufficient coverage?

FSM Jun 29, 2018 5826


"The more the merrier" - while it may be ingrained in us that it is always better to have more, this is not always the case when it comes to insurance. This is because two policies may not provide better coverage than one. Similarly, having multiple policies does not eliminate the possibility of a lack of coverage. Instead, doing so may result in you being over insured if you have multiple policies that provide the same coverage. With insurance meant to protect us and our loved ones, it is instead important for us to be able to discern between what we need so as to avoid repetitive policies. In this article, we elaborate on three ways that you may be unknowingly over insured.


#1 Multiple similar policies

Are you guilty of buying multiple policies thinking that it is always better to have more? If you are, then you may find yourself with several similar policies and overlapping coverage. Take for example healthcare policies, purchased with the intention to protect against the cost of rising healthcare, having multiple healthcare policies would not be sensible as claims can only be made from one policy. Alternatively, as life insurance is typically used to provide coverage for your shortfall, additional policies may not be required should you have ample coverage for your existing protection gap.

Therefore, as opposed to buying multiple life insurance policies, it is important for you to first determine your protection needs. With life insurance meant to protect your dependents, consider income protection policies for yourself if you do not have any dependents to protect for.


#2 Unaffordable premiums

Are you struggling to pay your insurance premiums? If yes, then you may be over insured with policies that are beyond what you need.

For example, you are likely over insured if you have an annual salary of RM50,000 but are buying coverage for RM2 million. This is because you may be insured for more than what you require and would be paying for coverage that you do not need. While doing so enables you to leave a larger sum behind for your loved ones, you may struggle with unnecessarily high premiums that are not sustainable in the long run.


#3 Not reviewing your policies regularly

When was the last time you reviewed your insurance portfolio? Dismissing the need to review our insurance policies may result in outdated policies that are no longer suitable for our current life stage. This is because a policy that was fitting 20 years ago may not be appropriate or adequate now.

For example, we purchase term insurance to address the protection gap and to provide for our dependents should we unfortunately pass on. However, would life insurance really be necessary if you have no dependents to provide for? Additionally, income protection policies are no longer important for retirees to have as they would no longer have any income to protect for. As such, a regular review of your insurance portfolio ensures that you do not have any forgotten policies and will be sufficiently covered in the event of an emergency.



It is however important that you do not skimp on your insurance as insurance is meant for protection and being adequately insured can lighten the financial burden on your loved ones. Moreover, while one plan may not be sufficient to cover all your needs, having ten plans may not necessarily do so either. Instead it is important to strike a balance so as to ensure that you are neither under nor over insured.

For starters, determine your shortfall by calculating your financial and protection needs. Next, assess what policies you already have so as to prevent obtaining duplicate policies. Knowing what you already have then allows you to work towards complementing your existing policies when looking to complete your insurance portfolio.


How FSM INSURANCE can help you

Our team of friendly advisers are able to help you review your financial objectives, long term commitments, and offer you investment and insurance advice specific to your needs. If you would like assistance in reviewing your financial and protection portfolio, or simply to get a quote for an insurance plan, you can contact our advisers at

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Protect yourself and your loved ones now and enjoy savings at FSM INSURANCE!

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