You Gotta Know……

There are a lot of reasons to buy insurance.  Auto insurance for the fender bender, homeowners insurance for the house burning down or burglary, business insurance if for no other reason than because people will sue.

All of those reasons are good enough for me.  Sign me up…….but there are plenty of you out there who disagree.  It all comes down to gambling.  Will “it” happen, won’t it?

Will it happen to me?  What will I do when the accident I caused injures people and I have no insurance?  Will my teenager leave the pizza box on the hot stove burner and burn down the house?  Will an employee be fired and then sue?  Who knows?  Some are comfortable thinking these scenarios won’t happen to them and, if they do, they will work it out.  It’s a gamble, but just what’s on the table?

I recently wrote a blog titled:  Just Because You Don’t Have It Doesn’t Mean They Won’t Take It.  Besides it being a very long title for anything, the reasons behind it holds true here.  Just because you choose to not buy insurance for the risk and there is a claim, doesn’t mean your property, your business, even your income won’t be taken.  On the table could be your home, your homes contents, your vehicle(s) and any other toys you own (boat, r.v., etc), your business and your current and future earnings.

If your negligence caused the loss, if a poor choice is made at work, or if the loss is just an accident that happened, without insurance to mitigate, the buck stops with you.  End of story.  No getting out of it.  Without insurance you will pay full price out of pocket.  Some have the ability to absorb the cost, some don’t.  Your “will it/won’t it” form of gambling will remove whatever help insurance might have given you toward the restoration costs.  If you don’t have enough readies, fire sale of your property and garnishment of your income might come next.

Insurance is pennies on the dollar (except in Canada where pennies no longer grow).  To me it makes sense to invest pennies to hedge against any loss, no matter what the size, that has to come out of your own pocket.

Gamble if you want to, I want to sleep at night.