Why Do Aging Couples Buy Insurance? Here Are Some Tips
People buy lottery tickets knowing that they probably won’t win the big jackpot because there is always a possibility, however remote, that they can. A dollar risked can produce a big payoff, however, and the cost-benefit analysis is somewhat similar when it involves buying insurance. Insurance premiums are bought by people not because they expect to get involved in a car accident today, lose their home in a fire tomorrow, or pass away next week, but because the financial protection it can offer and the peace of mind it provides one with are well worthwhile. The goal of insurance is to protect against financial risk.
There is no ‘right’ time to get insurance cover: it depends on where you are in your life and what you own that you want to protect. Typically when someone goes about purchasing a new asset like a home or boat, they will first buy an insurance policy. This is wise because insuring your asset before you put it at risk means that the risk shifts to the insurer, and away from you.
Your priorities as your age into a responsible adult will change drastically as you enter your mid-life, when having a spouse, children, a mortgage, and other property will change your outlook on life. As we move from one life stage to the next, our income and security needs naturally change. Under normal circumstances, if there is a risk of you or your assets becoming damaged in a financially important way, there is a policy you could purchase to mitigate that risk.
For many people, insurance is less a way of protecting against risk than an attractive, safe investment opportunity. Young professionals are typically interested in investing some of their income. These people see life insurance as a great investment for them. Variable life policies are riskier than normal insurance but can increase more quickly in value.
Some insurance covers could be a requirement by your loan company or state, but a majority of them are optional. However, you may want an additional coverage to cover your assets even when there are some payments to be made. Even when your employer has provided you with one or two forms of insurance, you can still go ahead and add a personal policy.
Property destruction, illness, injury and death are some of the risks everyone faces in life. While you can’t completely eliminate your risks, you can protect yourself financially by handing over some of your financial vulnerability to an insurance company. When you/or other covered individuals claim for the coverage, you will likely be give specified amount for the loss you encountered in return for the premiums you pay them. While you may never need insurance, you don’t want to gamble your savings and lose them all if something happens.