Imagine yourself driving down the road during a rain-soaked evening just like the ones we have had here in Southern California for the last three nights when suddenly another car skids and hits you right on the passenger side. What would you be thinking of first after a long list of bad words? Will you be thinking about your health? The other driver’s? To be honest, when I rear-ended someone, the first thing I thought about was car insurance premiums and how expensive that was going to be after the accident. A couple of years later, I am sure that is what the other driver was thinking when I was rear-ended. Los Angeles is great.
Who needs insurance?
You do. I do. We all do. Without insurance, little accidents can become very expensive and will deplete your emergency fund faster than you can say, “I have a toothache.” An emergency fund really should be just for things not covered by insurance policies. Think about it like this: If you work hard at your job to be able to save money and then get sick once and have to get hospitalized, then all the savings will go to paying the medical bills. That’s IF you have enough savings. Worst case scenario is that if you are like most Americans you go into debt because of the medical bills. What is the point of working so hard to save when one trip to the ER can erase all your savings?
I am not saying not to work hard. My two cents is that if you have something valuable (your life, your health, your car, etc), then it makes sense to insure it. This way all your assets (no matter how small or big) will be protected. It prevents you from taking two steps back for every one step forward, in case something happens.
High stakes game
If you have others depending on you and your income, then it is a SIN (check the Bible, I’m pretty sure it’s there) if you do not do everything possible to protect that stream of money and make sure that it reaches those dependents. A sin, I tell you. Seriously though, it makes a lot of sense that the car you drive to work is insured, the health and life you carry are insured, and everything else in between. That stream cannot be stopped because if it does then you will not be the only loser of the game.
Can you think of other things that need to be insured? When has an insurance policy saved you and your finances?
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