Building a House (Financial)

Insurance is a tool to manage financial risks of magnitude and proportion that one does not want to settle with one’s own money. It allows the policy owner to transfer major amount of the risk to a third party. It was designed as a vehicle for creating a win-win situation. Agreed, the system is not the most perfect, but still it works.

For a couple with children, buying a life insurance policy with appropriate coverage is a good place to begin with. Life insurance is critical in building a sound financial house. Additionally, one could also think about income replacement strategy during periods of disability. This is covered by a category of insurance called disability insurance. This type of insurance can be purchased by an individual who is either employed or generates income by means of self-employment. There are various other types of insurance products to cover any number of situations. Anybody considering purchasing an insurance contract should do some good home-work before signing any contract.

I do not like buying any insurance product beside the one I have for my car. I think it drains money from bank account. I hate it. But I would hate it more if I have to settle any large insurance claim with my own money.