28.06.2019
Living in a world without insurance!
When we purchase an insurance policy, we pay a certain amount of money to buy a protection we hope we will never need. And then, if we are actually lucky enough not to have used it, we complain that we have paid “for nothing”. How confusing is that!
But the fact is, whether we use our policy or not, it is as inconceivable to imagine a world without insurance as it is to imagine a world without risk.
If you don’t think the existence of insurance is a necessity, sit back, close your eyes and imagine your life without it.
A-Let’s get personal
1-Imagine applying for a loan:
If you are uninsurable, you will be turned down. Why? Banks and other financial institutions are happy to loan you money because that is how they make money. But make no mistake, they will only lend it to you if they are certain they can get it back. They need to protect their interests if your car is totally destroyed, or in case of a life-altering or fatal injury for example. They mostly use insurance to achieve that goal.
2-Imagine being denied that loan:
Buying your dream house, starting your own business, or simply purchasing a car becomes much more challenging. It may still be possible, if, for example, you make enough money and save most of it for years, or if you turn out to be the sole heir to a very wealthy distant relation in Mexico! Good luck with that!
3-Imagine you were able to afford all those things somehow:
Settled down, got married and had a couple of children. You will now need to protect your family; think medical expenses, financial hardship caused by sickness or worse, or major damage to your family home, or even the huge financial risk associated with simply driving your car. You can secure that protection with insurance.
B-Now let’s talk business
4-Imagine the factory you work for is operating without insurance:
Facing marine, fire, natural catastrophes, money, liability and a whole range of other risks. Setting money aside to fund potential losses, even if they never actually materialize, will alone cripple the business. With insurance, that money could be put to better use, for example, to expand or hire more people, which will mean more job security and better pay.
5-Imagine that factory suffers a major fire:
And has to close down for a few months. An adequate insurance cover will ensure that funds will be available to rebuild and pay the fixed expenses such as your salary, in the meantime. Otherwise, the business may not be able to recover, and many jobs will be lost.
Bottom line, these simple every day examples show that individuals, businesses, the economy and society as a whole would suffer greatly, and many things we take for granted would be difficult, if not impossible to obtain and enjoy without insurance.
