Possibly the most unloved word in the English language “Insurance” is something that many people love to hate. However you view the subject, insurance is an extremely important tool to carry in your “risk management” tool kit.
The insurance concept is very uncomplicated. Simply put, insurance is a pooling of resources to protect a member of the pool against a loss or catastrophic event for which the pool exists. An example is “Life Insurance”. One thousand people age thirty get together to create a pool and everyone agrees that the cost will be $500.00 a year to insure each member for one year. This pool will have $500,000.00 available to insure each member for say $25,000.00 should someone die. The next year the pool Manager together with the an actuary will analyze the claims and recommend to the members a decrease or increase in the amount of the premium based on the experience of the first year. This type of insurance may be referred to as yearly renewable insurance. Most of the time the premiums are worked out ahead of time for a period of years based on the overall experience of a specific demographic i.e. 30 year olds.
There are many different kinds of polices which makes the choice important and a custom design is best. In other words one size does not fit all. For instance “buy term and Invest the difference” is a concept that became popular in the eighties when whole life insurance became unwieldy and expensive mostly as a result effect of inflation.
There are many different classes of insurance and many are listed below. Call us to determine if the type you have is right for the purpose “your life” and if you have none call us quick. Too soon is not soon enough when it comes to protecting the financial affairs of your family or your estate.