I've been frequently seeing a TV advertisement regarding a new service that one of our local banks is offering. It has the same rates and requirements that regular bank accounts have but it now has a life insurance with it. If I remember it well, the owner of the account is automatically insured once he/she opens an account under that service. So if the person dies, his/her family will receive the insurance amount stated in the contract. The prepper in me makes me interested with that new service and I am planning on checking it out soon since I already have an account with that bank. I know that this is not a new thing in other countries so I'm just curious to know if this kind of service is also available in your country. Do you have that kind of account or are you interested in opening one soon?
In the Philippines, all savings and checking account deposits are guaranteed with an insurance by PDIC (Philippine Deposit Insurance Corporation that is an agency of the government). The insurance is part and parcel of the banking system.which covers up to 250,000 pesos. But time deposits are not covered by these, likewise with the trust funds in the bank are also not covered.
You would want to check the conditions on the policy which may say something like as long as you have your account with that bank you have the insurance but if you move your account you are no longer covered as what would happen if the bank closed, that is another concern I would have. Those types of insurance usually have a lower rate or will cover you if you have a health issue only as long as you are a member of the bank.
Thank you for the advice @Pat. I haven't actually thought about that but I'm guessing that one may have to keep his/her account with the bank for as long as he/she is alive so the family could benefit from the insurance if in case something happens to the account holder. According to my initial research, the amount of insurance they offer is up to 2x the value of the person's deposited money so I think insurance companies still have a bigger insurance coverage compared to the one being offered in this specific bank.
The account is normally operated but how does one pay the premium to maintain the insurance? Is it deducted from the account? One should check whether the compensation of 2 times the deposit is commensurate with the premium in comparison to non bank insurance policies. I would only open such an account if it additionally insures my account against fraud.
It's always good to have insurance, but be sure you're really covered and you can find this out by reading the exclusions section of the insurance policy. Our bank in Hawaii always sends us an ins. invitation with special prices for we members. It's so expensive for we're older, so it's best to get ins. at an early age when it's inexpensive to do so.
