Insurance is so important because it offers peace of mind. Insurance allows for the unexpected to happen and still be able to manage. You see this in virtually all types of insurance, but the types I am mostly talking about are: Auto, Life, and Disability insurance.
Why is auto insurance so important? Mostly, I believe it is important because accidents do and will happen. Vehicles today cost a small fortune and it just makes sense to cover your financial bases in case something bad happens. With the kind of investment (I’m using that term loosely) it takes to drive away in a new vehicle, it just makes sense to transfer some of the financial risk onto someone else…namely an insurance company.
Why is disability insurance so important? Disability insurance is so important because the chances of becoming and suffering a long term disability are 1 in 3. Your most important asset you have is your ability to earn an income. Consider someone aged 35 who earns $60,000 a year and has another 32 years before retirement. That’s $1.92 million in earnings – not including any salary increases. This is why I believe disability insurance is a pivotal piece of your financial foundation, without your earnings how do you keep your financial plan in place? You can’t!
Why is life insurance so important? Life insurance is the other major piece of your financial foundation which you build your financial plan on. It is my personal belief that life insurance is a necessity for anyone who has someone else who depends on them to provide for the other. All too often I hear how people “don’t want to think about death”, or how “I don’t believe in life insurance.” That’s not the point! You don’t want to talk about death, especially your own-that is totally fine, then let’s not talk about death.
Let’s talk about life, your life, and what you provide for your loved ones. Wouldn’t you want to know that no matter what happens your loved ones are taken care of financially? So, you don’t believe in insurance? If you were given life insurance for free, would you take it? Chances are you would, so the question isn’t whether you believe in life insurance or not, it’s you just don’t want to pay for it. Life insurance is not for the individual, it is for those who depend on them. Life insurance is there for your financial plan to succeed just in case something happens to you. Most of all, it is peace of mind knowing your loved ones will have your plan to continue to be relied upon.