Most Jamaicans have but a vague idea of what insurance is and why they need it. They understand that they need car insurance because if something should happen to their car accidentally while on the road their insurance company will pay to have whatever (or whomever) got damaged replaced and in the event that this was someone, they can claim medical coverage. People also seem to see why they need health insurance so that just in case they need to go to the doctor because of illness their insurance company will help to offset the cost. So essentially insurance is your back up plan, just in case something does happen. It is your ‘what if’ safety net.
What still puzzles me however is that the majority of people persist to disrespect financial advisors saying they are just out to get their money 👀 Hello??? It is a job. All businesses are out to get your money. Everyone of us as adults are ‘out to get’ each others’ money. That is the reality of the world. We survive because we have found a medium of exchanging value. Once upon a time we traded/bartered our goods and services among each other. In this new age we trade using money. It’s a job like any other.
All occupations seek to meet a need. What financial advisors try to do is help you to put aside money for the known and the unknown. In the case of life insurance aka death benefit insurance it is an opportunity to set money aside to take care of your dependents (wife, children, elderly parents, etc.) in the event you pass on before they do. After all, we all will die at some point however we never know when it will be our time. It is like any other asset, a legacy that you can leave within your family.
Most Jamaicans believes it makes better sense to keep their money in the bank. Well, my friend, you only get what you put into the bank and sometimes even less. With an insurance policy, say with a 2 million dollar coverage, if you die suddenly (accident) after only 2 years of contributing to the policy having been contributing only 1000 JMD per month your beneficiaries still get the total sum you were insured for upon making a claim after you pass on. So you see, comparing it to a savings account is a bit of a stretch.
Think about it like this:
- Your insurance policy has cash value – which means you can withdraw funds from the policy while you are alive to take care of any immediate need. Eg. It can be used as a saving tool towards a dependent’s education while keeping it’s long term benefits.
- Most policies have critical illness coverage – so if you should be diagnosed with a serious illness (usually listed under the policy details) you can make a claim upon diagnosis and use that money for sustenance while you are unable to work.
- You can use a policy to supplement your pension after retirement (annuities).
There are a number of other technical benefits especially for businesses. Do some research online. And if you have questions, there is nothing wrong with making an appointment with an advisor who can better explain the intricacies. CONSULTATIONS ARE FREE!!
Since something is likely to happen to any of us at anytime, why not set aside funds for when it does.
DISCLAIMER: This is my basic understanding of something I consider a relevant asset. I am not a Financial Advisor. Here is the contact for my agent: firstname.lastname@example.org She's also on Facebook (Meila) Twitter and LinkedIn (Meila Mckitty Plummer)