Never take your protection or that of your family of your property or your business lightly, being insured can put you at an advantage, having a coverage policy against accidents or incidents, you can be calm, since the costs will be covered by the insurance company with which you are subscribed.
I know that choosing insurance correctly could be very stressful, confusing or seem like an exhausting task, but take a minute to think about it, it is necessary to be clear about your priority or need to contact the insurance company that suits your needs.
During the next post, I will be talking about the main aspects and the types of insurance that exist, all to try to clarify any doubts about it since there are people who can confuse a retirement policy with a policy or life insurance in case of accidents or death. Although it seems silly to say it, explaining and educating the literate public about these details is not a minor thing, since it would save you headaches, confusion that in my opinion can cost you dearly. Your time is valuable dear reader so there is not much prelude to The Ultimate Guide to Choose The Best Insurance.
I do not want you to misunderstand my words, but you must be very careful in this matter (read the small letters) misinformation only leads to one path and that is a possible wrong contracting of a service that we do not need, in a nutshell waste of money and time.
¿How necessary is it to hire or have insurance?
Once we get the right purpose of the insurance we need, it will become a science or it will be easier to hire the right service, then everything will make more sense to you as soon as you are very clear about what your needs are for this topic. The purpose of life insurance is the same purpose as any other type of insurance. It is to «insure against loss of». Auto insurance is to insure your car or someone else’s car in the event of a major or minor accident. In other words, since you probably couldn’t pay for the damage yourself, the insurance is in place, covered, and protected.
Homeowners insurance is insurance against the loss of your home or the things in it. So since there’s a chance you might not be able to afford a new house, buy an insurance policy to cover it, this is a great solution for an event like that.
Life insurance is in the same proportion to insure against the loss of your life. If you had a family, it would be impossible to receive compensation after your death, so if you buy life insurance, if something were to happen to you, your family (spouse, children, etc.) could replace your income. Life insurance is not to make you or your descendants rich or give them a reason to kill you (I hope not!). Life insurance is not to help you retire or else it would be called retirement insurance!
¿How much should you buy insurance?
I typically recommend 8-10 times your annual income as a good face amount for your insurance. Why so high? Here’s why. Let’s say you earn $60,000 per year. If you were to die, your family could take $600,000 (10 times $60,000) and put it in a fund that pays 10 percent (which will give them $60,000 a year) and not touch the principle. So what you’ve done is replace your income.
This is another reason why Whole Life insurance is bad. It’s impossible to afford the amount of insurance you need by trying to buy overpriced policies. Term insurance is much cheaper. To add to this, don’t let the high face values scare you. If you have many responsibilities and are worried about your family, it is much better to be underinsured than not at all.