[SPONSORED] Your Money Protected or Not? A Quiz

If you’re like me, you probably have your money all over the place:

  • In bank accounts (plural, because I have a few accounts with a few banks)
  • In various e-wallets and prepaid cards,
  • ‘Borrowed’ from legal entities (ie credit cards and loans) or illegal entities (ah long money lenders),
  • In ‘future money’ like insurance/takaful payouts,
  • In various investment accounts,
  • In physical forms like gold or property or high-value collectables,
  • With your friend who promised to pay you back soon,
  • In actual wallets (almost forgot about this one. Cashless trend is still going strong)
  • And more.

So my question to you today is… do you know what kind of protection is available for each of those listed? How sure are you that you get to access your money when you need to use it?

Wait huh, you might think, of course your money should be accessible, the financial ecosystem in Malaysia is good, right? (it is), I don’t need to worry, right? (mostly you don’t… but you should still know because this concerns YOUR money).

Take this quiz to test your understanding of your money’s protection – which is protected by PIDM and which isn’t. Have a look at the three scenarios, including one of Future You (surprise! You’ve reached financial freedom and are a multi-millionaire!)

Quiz #1 – How Protected is Kay’s Money?

Scenario 1: Kay, 24, Single, Executive

Kay’s money situation:

protected by pidm

Can you guess the ones protected by PIDM?

Click the arrow to see the answer:

PIDM protects:

  • RM500 in Savings Account in Bank A (PIDM Member bank)
  • RM1,000 in Current Account in Bank A (PIDM Member bank)

Why?

PIDM protects eligible deposits up to RM250,000 per depositor per member bank, and Kay’s deposits are protected in full as the total amount kept in Bank A (a PIDM member Bank), RM1,500, is less than RM250,000.

PIDM’s protection DOES NOT extend to:

  • Money in e-wallets
  • Gold savings accounts
  • ASB
  • Bitcoin
  • Loan to friend (good luck getting that money back)

Quiz #2 – How Protected is Ell and Bee’s Money?

Scenario 2: Ell and Bee, both 30, Married Couple, Own Business

Ell and Bee’s money situation:

protected by pidm

Can you guess the ones protected by PIDM?

Click the arrow to see the answer:

PIDM protects:

  • RM8,000 in Savings Account in Bank A (PIDM member bank) (Ell)
  • RM12,000 in Savings Account in Bank A (PIDM member bank) (Bee)
  • RM15,000 in Current Account in Bank B (PIDM member bank) (joint business account) (Ell & Bee Sdn Bhd)
  • RM50,000 in fixed deposit in Bank A (PIDM member bank) (Ell)
  • RM200,000 in insurance/takaful benefits in Insurance Company A (PIDM insurer member)

Why?

PIDM protects eligible deposits up to RM250,000 per depositor per member bank, and up to RM500,000 for takaful and insurance benefits (for death, permanent disability, critical illness, loss or damage of property).

Therefore, Ell and Bee’s deposits and insurance/takaful benefits are protected as they have RM58,000 and RM12,000 respectively in Bank A, RM15,000 in Bank B, and RM200,000 in insurance/takaful benefits.

PIDM’s protection DOES NOT extend to:

  • Investment banks
  • Overseas branches of member banks
  • Money in the stock market
  • Money in prepaid cards
  • Scams or fraudulent transfers (ie go to police not to PIDM)

Quiz #3 – How Protected is Future You’s Money?

Scenario 3: Future You, 40, Hit Financial Freedom!

Future You’s money situation:

protected by pidm

Can you guess the ones protected by PIDM?

Click the arrow to see the answer:

PIDM protects:

  • RM250,000 in Conventional Account in Bank A (PIDM member bank) – the additional RM250,000 is NOT protected
  • RM200,000 in Islamic Account in Bank A (PIDM member bank)
  • RM1,000,000 in insurance benefits in Insurance Company A (PIDM insurer member)
  • RM8,000 in annuity income per month in Insurance Company A (PIDM insurer member)

PIDM protects eligible deposits up to RM250,000 per depositor per member bank. The limit also applies separately to Islamic and conventional deposits.

PIDM also protects up to RM500,000 for takaful and insurance benefits (for death, permanent disability, critical illness, loss or damage of property), up to RM10,000 for disability and annuity income per month, and 100% of expenses incurred for medical expenses.

The amount of protected benefits will be aggregated only if they relate to the same insurer member, same risk event, same life insured or insured property, and same takaful certificate or insurance policy owner.

 Therefore, Future You can optimise PIDM’s protection by simply:

  • transferring the unprotected monies, including the RM250,000 deposit in Conventional Account in Bank A to another PIDM member bank, and
  • Getting two life insurance policies with the sum assured of RM500,000 from two PIDM insurer members instead of one life insurance policy with the sum assured of RM1,000,000 from one insurer member

PIDM’s protection DOES NOT extend to:

  • International Islamic banks,
  • Labuan offshore banks,
  • SSPN, and
  • cash on hand

Does that mean… not PIDM member = no protection for my money?

I didn’t say that. Usually (but not always), legally-established financial companies that are not PIDM members do put in some measures in place to ensure safety, because hey, good reputation helps with business and they want your business correct not. They are also governed by strict laws and regulations by BNM and Securities Commission.

However, if anything happens, the returning-of-funds-back-to-you may not be as automatic as PIDM, in which they already have a system in place should a member bank or insurer member be going bankrupt. PIDM-insured funds will be given back to you even before the (long) winding up process is completed.

For non-PIDM-insured funds? There are other protective measures – for example, savings in ASB, BSN and Tabung Haji are guaranteed by the government. Know your rights as a financial consumer when placing funds with a non-PIDM member institution, and only do so if you’re comfortable with the risks.

protected by pidm

Therefore, as someone who is responsible for your own money management, it’s not a bad idea to plan your deposits and insurance/takaful around maximising PIDM’s protection. Best case scenario, nothing happens, life goes on as usual.

Worse case situation, you’ll get your deposits and benefits faster and automatically. Currently, 97% of depositors in Malaysia – the remaining 3% includes people in Scenario #3 – are fully protected by PIDM (which is a fully FREE service btw).

Let me know in the comments section how you did in the quiz. Did you get the scope of PIDM’s protection right? This concerns your money, and Future You should know this!

 

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