Is Insurance a Waste Of Money?

There are some people that think that insurance is a waste of money. They feel that the money would be better off being invested in the bank and then it can be used if necessary. Alternatively, they think that it is just too expensive and they can spend their money better on other things.

It is worth thinking about what insurance will actually do for you though. In the worst case scenario it could pay for your house to be fully rebuilt if it burns down, for your car to be replaced if it is a write off or give you a lump sum of money to help you manage financially if someone dies. These sorts of amounts of money are not something which most people could find easily.

You could start saving the money that you would pay on insurance in a bank account and then if you do have a problem, you could use that money rather than making a claim on an insurance policy. This sounds good in theory, but it is possible that you will not have enough money to pay for it, especially if you need it quite soon. It could also be a great deal of money, especially if you need to rebuilt your house or replace a lot of damaged possessions and so it could take too long to save up. You also need to be well disciplined and make sure that you never spend any of that money, which can be extremely difficult.

It is a gamble, as there is a chance that you will never need to make a claim on an insurance policy. However, it can give you a lot of peace of mind, knowing that it is there in case you need it. It is worth considering what you might do if you were in a situation where insurance could protect you and what you would do to manage. Some insurance may not be necessary and some very necessary, it all very much depends on your circumstances. So it is worth giving it some thought and deciding what might suit you best in your present situation. Remember that things do change though and you may find that you need insurance in the future. It is therefore worth keeping it in mind, even if you decide that you do not need to take it out at this moment in time.