Insurance, in general, is often considered the foundation to a solid wealth building plan. If you have managed to build wealth for yourself and your family through an accumulation of monetary savings, purchasing of real estate, multiple successful businesses or similar investments, it becomes critically important to obtain insurance vehicles that will help protect and preserve this wealth.
Obtaining various types of insurance, essentially shifts some financial risks to insurance companies, allowing your precious savings to be used for other wants and needs. This article discusses the various types of insurance plans individuals may use to keep their savings from being eroded by high medical expenses, disability and other life and/or business events that may or may not be outside of our control.
1. Loss of Income from Disability
Disability income coverage helps replace the loss of personal income due to a disability. This type of policy can be issued on an individual or group (i.e. employer sponsored plans) basis.
2. Medical Expense Benefits
Provides benefits to cover the expenses related to in-hospital medical treatment, surgery, outpatient expenses (i.e. doctor visits and lab tests). Premiums paid by the business for sole proprietors and partners are generally, tax deductible to the business, but considered income to the individual.
3. Long-Term Care Policies
Pays for the care of individuals with disabilities or other ailments that require health and social services to be rendered by medical professionals. This type of insurance covers nursing home care, home-based care and respite care.
4. Whole Life Insurance
Is a permanent life policy that covers individuals usually up to the age of 100 to 120. It consists of an accumulation of cash value and net insurance protection. Policy loans can be taken on these types of insurance policies tax free to help cover living expenses.
5. Automobile Coverage
A quality auto policy can reduce or completely eliminate your out of pocket costs if you or other covered individuals are in an accident. Review your coverage amounts, make sure to add any under-aged drivers in your household to your policy and ensure a solid understanding of the provisions written in your policy.
6. General Liability for your business
Protects your company from incidents that can arise in your business that are outside of your control (or within your control). Many general liability policies cover employee theft and other events that can cause financial damage to your business.
In summary, it takes time, sacrifice and commitment to build wealth, only to have a single incident take place in our lives that can greatly diminsh it. These policies may not be able to protect you from every mishap, but they will certainly help to minimize the financial hit of the events that can be covered.
To learn more about safeguarding you and your family, check out the articles below:
3 Reasons to Consider Life Insurance for your Business
The Best Way to Protect your Family with Life Insurance
