We all have one thing in common, other than being avid personal finance fanatics we also all have insurance, in some form or another. Insurance is the one financial product that we all have regardless of our current financial situation.
If you have a high net worth or a negative net worth you still need some form of insurance. Whether you walk to work, take the bus to work or you drive your own car you still need to purchase insurance.
Do you think insurance is worth it?
We all need some form of home insurance, health insurance, auto insurance or life insurance, we just don’t always need to have all of them.
Some people like to purchase insurance for everything they do including extended purchase warranties on their new electronics and travel insurance when they go on vacation. I think it’s safe to say that insurance is the one financial product that we all have in common.
I know some people who purchase only the basic insurance that is required because they feel it is a waste of money. Whenever one of the clients at the bank opted not to purchase insurance on their credit products, on their life or for their family vacation I always asked them why they didn’t want to purchase insurance and their answer was always the same, because I can’t afford it and because I don’t need. My reply was always the same, can you really afford not to purchase insurance.
Can you really afford not to have insurance?
Just imagine the worst case scenario, imagine that something bad happened to your home or to you or your spouse while you are on vacation. Isn’t it just cheaper to purchase the insurance coverage rather than pay the costs of medical treatment while overseas or the cost to replace all of your personal items if you home is ever damaged. I feel that insurance can be a valuable tool to protect your most valuable assets.
People should be honest with their insurance claims because insurance fraud is a serious offence; I am personally afraid to go to jail so I try to keep my insurance claims to a minimum. Don’t get me wrong I take full advantage of my health insurance benefits, but I don’t abuse them. I can say that now, but who knows what lengths any of us would go to if we were in desperate need of money.
MSN recently published a list of classic insurance scams:
1. Faking a death to collect the life insurance. Anyone who has ever lost someone close to them knows that death is no laughing matter. But if you were hard up for cash would you fake your own death for the insurance money?
2. Deliberately getting to a car accident. This is like an afterschool special and a Lifetime movie all wrapped into one. Very often people fake injuries in a car accident just so they can collect more insurance money. You know what they say about what goes around…so be careful what you wish for.
3. Unnecessary arson. I couldn’t help but laugh when I saw this because just before I left my bank branch there was a woman who built a new home but couldn’t afford the mortgage payments so she burnt it down to collect the insurance money. Just another reason why I should continue renting.
Photo by dvs
Kristina Tahnyak
Tahnya is a Certified Financial Planner and former Investment Advisor turned marketing and communications professional She holds a degree from Concordia University, is debt free and currently works in the field of digital marketing.
I know people who didn’t have insurance on their home and they discovered mold throughout the entire house and had to move out. It was a total loss for them. Bet they’d wished they’d spent the money on home insurance.
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