Insurance can often get complex, with so many variables and options for plans and coverage, as well as types of insurances, including health and life, but one thing that remains common throughout all forms of Insurance, is that it is a way of managing risks. Insurance has evolved into a broad system to safeguard the interest of people from uncertainty or loss. It is a social tool to reduce or eliminate the risk of the loss of life or property. Below you will find some of the most important key factors and advantages of having Health Insurance in place, to help you understand managing risk, and why it helps more than just medical costs.
Peace of Mind is Priceless
To put it simply, when you purchase insurance, you are transferring the expense of a potential loss to the insurance company, in exchange for a fee, known as your premium. Insurance companies invest the money securely, so it can expand or grow, and pay out when there’s a need for a claim.
One very common, yet very misaligned perception of insurance is that you put money into a policy for years, if not for decades, with nothing physical to show for it. The idea is not specifically meant to be an investment tool, though it can be with the right chosen kinds of coverage, however, the purpose is to manage that risk. You may live for the next 30 years completely healthy and happy, but as for life, it brings uncertainty.
You never know when you will have an accident, death, or loss event, and should those things occur, you would be left to pay expenses out-of-pocket, many times bankrupting people and having less than desirable outcomes, such as potentially losing a home, or not being able to afford life-saving or necessary medical intervention. It is a costly mistake to assume insurance is just something you “pay for and get nothing in return!”. Peace of mind is priceless to ensure that you and your family or your business are safe in the event it’s needed.
Insurance Provides a Measure of Security and Safety
In everyday life, and in business, Insurance provides financial support and reduces uncertainties. Your Insurance provides safety and security against a particular event that would otherwise be a loss. There is always a background fear of sudden loss, and Insurance provides coverage in the event of a sudden loss, so the effects aren’t catastrophic for the insured. For example, in the case of life insurance, financial assistance is provided to the family of the insured in the event of his or her death. Same concept goes for other kinds of insurances, security is provided against the loss.
Insurance Generates Financial Resources.
An interesting perspective to consider is that Insurance generates funds by collecting a premium. These movies are then invested in government securities and stock. The funds are profitably used in the industrial development of the country. Employment opportunities are increased by large investments leading to capital accumulation.
Life Insurance Encourages Savings
Not only does Insurance protect you against uncertainty and risk, but it can also provide you with a channel for investment purposes as well. Life Insurance, for instance, enables systematic savings due to the payment of a regular premium. Life Insurance provides a mode of investment, as it develops a habit of saving money by paying the premium. In some instances, the insured gets the lump sum at the maturity of the contract, thus showing how Life Insurance encourages saving all around.
Insurance Promotes Economic Growth
One thing people don’t typically consider is that Insurance does generate a significant impact on our economy, by mobilizing domestic savings. Your Insurance company will turn accumulated funds into productive investments. Insurance enables loss mitigation, financial stability, as well as promotes commerce activities and trade, which result in economic growth and sustainability.
Insurance Provides Medical Support
Medical Insurance is considered to be essential in managing risk in health. Tomorrow isn’t promised as they say, and anyone can be a victim of an unexpected or critical illness. Rising medical expenses would soon be a big concern. Medical Insurance caters to different types of health risks, The insured receives medical support in the event of a medical emergency through their Medical Insurance policy, saving the customer from a flood of uncovered or accruing expenses.
Insurance Spreads and Manages Risk
The basic principle of Insurance itself is to spread the risk among a larger number of people. You pay a premium based on your personal risk assessment, and whenever a loss or loss event occurs, the insured is compensated out of the funds from the insurer. Insurance is used to share losses associated with property, liability and income. The insurer would assume the risk in the event of one of these instances, as long as you have the proper coverage in place.
Insurance Can Be a Source for Collecting Funds
Large funds are collected in the form of a premium. These funds are utilized in the development of the country, which increases employment opportunities as well as boosts economic growth. Thus making Insurance a legitimate source of capital formation, or funds accumulation during the term of the policy. Sometimes this money is accessible to you at the maturity of the policy, sometimes before then, depending on the terms of your specific policy and what it entails.
So, as you can see, Insurance is an essential tool for managing the risk in your life, and is really important to have in place when possible, as it will protect you from major loss, medical expenses, as well as protect your family income as well as your business.
Speaking to an experienced and seasoned Insurance Professional has it’s benefits as well! You are able to have someone show you various options, breakdown the benefits in a way that you understand them and how to use them, as well as making sure the coverage suits you and your family’s needs and your budget! Best of all an insurance agent or broker will offer this service to you free of charge so you don’t have to worry about cut throat sales tactics. The goal is to protect you, your family, and expertly help you manage your risk. For more information, or to speak with an Insurance Professional, fill out the contact form below and we will reach out to you as soon as we can!