Protect Your Assets with Insurance- Part 1

Every day, people are exposed to risks which can cause a financial loss. Accidents, property damage, illness, disability, and even death are risks they need to consider. Without a risk management plan, people often have to go into debt or use funds set aside for other financial goals in the event of a financial loss. Below are four insurance recommendations:

• Insure Against Large Potential Losses- Purchase insurance for large financial risks that could deplete your savings or future earnings. This includes at least $300,000 ($500,000 is better) of liability coverage on property insurance policies to cover the risk of court judgments resulting from an accident at your home or with your car and disability insurance to protect against the loss of income due to illness or injury.

• Consider Life Insurance- Purchase life insurance if you have dependents who would suffer financially if you died. Another good candidate for life insurance is a young adult without dependents whose parents co-signed private student loans which are not forgiven in the event of death. An online life insurance calculator or worksheet can be used to determine the amount of life insurance coverage that is needed.

• Protect Real and Personal Property- Purchase property insurance with a replacement cost rider on personal property to replace items at their current cost up to the policy limit. Otherwise, only the actual cash value after depreciation will be reimbursed in the event of a loss.

• Build Relationships- Establish an ongoing relationship with one or more insurance professionals who can provide a periodic review of coverage and information about available cost-saving options such as discounts for military service and short commutes and “bundling” of auto and homeowners insurance.