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Insuring Your Most Valuable and Fragile Asset

by Russell Janecka | Feb 06, 2013

You have that car covered, because the law and the bank say you shall. Your mortgage company tells you to maintain a policy covering the value of the home to protect their interest. Because of these forced situations of insurance purchases, many feel some negativity towards insurance companies.

Such resentment is understandable if you have never suffered a loss, except perhaps for your annual premium dollars. Count yourself lucky indeed. But you would feel most unlucky if you suffered an uninsured loss. The bank would surely come calling for their outstanding debt in the absence of the lost collateral. An auto accident can suddenly cause thousands of dollars of liability owed to others, in addition to the loss of your own car, so without question it is good financial planning to maintain auto insurance at adequate limits.

But what about your money machine? Usually there is no bank or law requiring you to insure it. It's the most valuable thing you have. Your family depends upon it daily. It is you! Your ability to earn an income and provide for your family is a very dear thing to your family. Don't worry, I'm sure they love you for more than just your money, but your providing for them is what makes their life manageable and secure.

Imagine removing yourself suddenly from the picture, for the rest of their lives. What will they do? The house is still mortgaged and needs its usual repairs. Taxes and utilities will still be owed. Oh, and Junior will need a car at 16 and daughter hopes to attend college - if the family can afford it. Will these things be taken care of without your income going into the family banking account?

Your health and your life indeed are a very real economic value to your family and deserve to be insured. The products to do this are available, competitive and worth every penny. But nobody is making you buy them - you have to either be asked by an insurance agent, or your spouse, or else choose to do this by yourself. It takes a strong sense of responsibility toward others to motivate one to act on this.

I look at this way - I didn't just choose to marry my wife for as long as I live, I committed to be there for her as long as SHE shall live. So if I leave the picture early, she deserves to live out the same life plan for having known me during my life, and not be left holding the bag. I also like to refer to a life insurance application as a love letter. It is a terrific way to put into writing that you love your children and your spouse - and want to keep them economically secure.

Even men or women who do not have a paid income, but provide services for someone who depends on them, should consider buying life insurance to provide for these lost services for some period of time (such as until the children have reached 16 or 18 years of age).

There is an additional need to consider - that of a sudden injury or illness that does not cause death, but instead leaves you unable to work. Being disabled is difficult enough on its own, but becoming disabled as the bread-winner of the family can be economically and emotionally devastating. Social Security only provides disability benefits when you are severely injured and unable to perform any work. The availability of these benefits should not be depended upon for your family's welfare. Look into a disability income insurance policy. Such programs are rated based upon the risk factors of your employment as well as your age and current health condition.

But act now. Don't wait until after your health might become impaired by a major illness or injury, which could make you uninsurable or insurable but at a higher cost. As I explained, your life, your earning potential, is a fragile and valuable thing that should be protected - and insured.

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