In everyone’s life journey there will be some very difficult times. Most people are ready to protect what they have bought, such as our cars, our homes and our jewellery. However, many people simply put off insuring what helped us to buy those necessities in the first place, that is of course our ability to earn an income.
Think of it this way, if you had a goose that laid golden eggs, what would you insure, the goose or the eggs?
1. Get some professional help
A good adviser will assist with savings and personal risk insurance. You might be surprised by the work required to finalise the contracts. Of course, these days sorting out insurance on-line can also be a great option with service levels always improving.
2. Compare different insurance companies
Not all insurance companies are the same. It’s important to scan several companies for the most suitable insurance for you. This shouldn’t be driven by the cost, it should be driven by the insurance terms and conditions that best meet your situation. For example, a doctor will work under very different conditions to a truck driver and both should seek insurance that matches their line of work.
3. Apply for what you need
This can be a bit difficult depending upon your circumstances. The idea of seeing a professional is to help you with making an assessment. The goal is to have a mix of cover that protects a variety of situations without blowing the budget. Points to consider
- Do you have cover at work?
- Do you have some existing policies?
- How long could you financially survive without eating too much into your savings should you have a sickness or accident (consider sick and holiday leave accrued at work)
- Your debt situation, would be nice to clear all debt and committed school/college fees
- Have an insurance plan that can be reduced as you reduce your debts and other liabilities.
4. Be weary of ‘Buy now and save’ insurance offers
Don’t get caught out buying quick and easy insurance in the hope of getting it done. Many of these ‘quick offers’ have been created to get a fast sale and may not necessarily pay up for a range of situations which you need to be covered for. If you are not seeking professional advice, do as much research as possible.
5. Make sure you know the insurance company
The main reason for insurance is to make sure you get a pay-out when you need it most. If the insurance company itself is broke or not reliable, this defeats the purpose of having insurance. While you may not know the insurance company, you have no excuses for not doing your own research. You can always start with friends and family, visit company websites, look for some reviews. What you are looking for is a long established history of the company paying out claims.