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Photo Credits : Curious Bino
Good news: more Filipinos are getting covered by insurance. The unfortunate tidbit is that more still remain uninsured. Why are Filipinos not getting insurance?
- They don’t think they need it.
- They are investing in bonds and other portfolios that would hopefully bring them huge returns in the future.
- They are expensive.
- They think insurance companies are simply interested in their money.
- They don’t have money.
We can cite more reasons to answer why, but regardless of what it is, it doesn’t change the hard truth that insurance benefits you more than you think.
Insurance can:
Give you the peace of mind.
According to the 2015 survey conducted by the American Psychological Association, money is the leading cause of stress among Americans. In fact, the stress can be so severe it can make one sick. While the survey was in an American setting, the results resonate around the world. We do worry about money because, although it cannot buy everything, it still remains a necessity.
Insurance is a form of guarantee that in case you find yourself or your family members cash strapped, you know there’s money to count on—a huge financial burden lifted off the shoulders.
Protect your assets.
Life insurance, for example, can be used for estate planning and gives you income if something bad happens to you like developing a permanent disability. Health insurance protects your health while home and auto insurance cover your physical or tangible properties.
Reward you
Life insurance policies such as variable-linked insurance combine investments and financial protection in the bundle. This means that a part of the premium you pay for the insurance is invested in stock, bond, or mutual funds, depending on your preference or investment profile. Other insurance policies have features like money backs or guaranteed cash value.
Adapt to life changes
As you grow old, you buy a house or a car, send your children to school, take on jobs, and get married, to name a few. In each of these seasons, your financial needs are different. Insurance can be acquired to provide you monetary support in your life stages.
Give you more financial freedom.
Insurance is there to see to it that if you’re faced with a major crisis, you’re not forced to dip into your emergency fund or your children’s college education fund. You won’t have to sell your home or whatever large asset you have, as well as skip your other financial obligation. Insurance would help ensure you don’t fall into an endless cycle of debt.
Provide you with great retirement.
Your SSS pension may not be enough to give you the retirement of your dreams, more so if it cannot beat inflation. You can use your insurance, particularly if it has an investment component, as a buffer.
Insurance isn’t merely an expense you pay every month or quarter. It is a worthwhile investment not only for yourself but also for your family and their future. It’s how you respect your hard work and show your commitment to your loved ones.
In my continued learning about Personal Finance, I came to know that there is Estate Tax in the Philippines. Estate Tax is the tax being charged to any heir of a deceased person.