Financial Consequences of Living Without Insurance | Welcome to Linda Ikeji's Blog

LI_Leaderboard_4

LI_Leaderboard_1

LI_Leaderboard_2

LI_Leaderboard_3

Wednesday, 31 May 2017

Financial Consequences of Living Without Insurance

It’s finally payday and you've gone ahead to withdraw some cash to head out for your much needed weekend thrills. Everything has been running smoothly so far until a few moments into your trip, as you make your way from work to your parked car, you step on a piece of glass and have to get several stitches at the hospital...




Driving out, a speeding car brushes past yours and damages your headlights, leaving you to call the mechanic to fix the damage. After all you’ve been through, you still had to foot the bills directly and you're left without enough for the rest of the new month. Things is you would still have had your money intact, if you'd only gotten insurance.

Eventualities like having a car theft or an accident, a property stolen from your house, theft in your business, flood in your property or a health emergency always happen, and being financially capable of sorting them out is not enough. When cash is scarce and revenues are down or even if the money is available, the sudden need to spend money on unplanned issues can leave you exposed to financial risk. In a crisis, almost anything without insurance or that which is under-insured can be totally destroyed.

Insurance cover like health, car, home, life and other forms of insurance are designed to protect you from financial risk and not just to save you from eventuality. No matter how money never seems to be enough, never have property or valuable uninsured; that valuable can be your or your loved one.


How Does Being Uninsured Affect Your Finances?


Insurance is important for your peace of mind, with it, you can minimize the effects of unexpected and often unwelcome future events. It also helps you to organize your personal finances and business life with more confidence. If you are uninsured, you are prone to one or more of these financial woes;

       The Risk of Unplanned Expenditure
It's common knowledge that only about 1 percent of the populace actually have a net worth that can afford them a carefree life of expenditures without worry, being that their earnings . And for the average person who earns relatively less, such financial liberty of carefree expenditures would be a hard hit to absorb. Even if you’re relatively wealthy, if you have a serious illness or a bad accident, your medical bills or bills paid to replace the damages or loss of property could be unmanageable if you have to pay from your pocket because you chose to go without insurance.

       The Risk of Bankruptcy
There's lots of scary statistics about bankruptcies today and studies that show that bankruptcy filers are usually uninsured at the time of filing. Currently, uninsured people constitute 31% of bankruptcies recorded annually while that of the insured is about 10.8%. Evidently the reason uninsured people have such a high percentage risk of bankruptcy is because they don’t purchase insurance policies that cover areas that would have otherwise prompted unplanned expenditures. Which means that obtaining insurance might potentially cut the risk of experiencing a bankruptcy very significantly.

       The Risk of Indebtment
Needless to say, for most uninsured people, the biggest financial risk is indebtment. With inflation costs on the constant high, it’s also become harder to out-rightly manage these unwanted situations and some come with a high cost of settlement. Waiting until crisis means subjecting your immediate finances to the cost of the time which may leave you with a huge debt to pay off.


Being Uninsured Affects More than Your Finances


Living uninsured also goes beyond your personal finances and affect other areas of your life in the following ways;

Health Risks: In health Insurance, uninsured people are far more likely than those with insurance to postpone health care or forgo it altogether. The consequences can be severe, particularly when preventable conditions or chronic diseases go undetected.
Risks to Your Loved Ones: You’re not the only one put at risk when you’re uninsured. How you live your life affects those around you, your loved ones are at risk when you go without insurance. For example, they’ll suffer financially if they help you with medical or repair bills. If they depend on you financially and you have a financial crisis due to health care bills, they’ll suffer the repercussions of your financial crisis. Worse, you could suffer pain if your dependent loved one is ill or was in an accident.
Risks to Your Local Community and society as a whole: In the bigger picture, if you can’t pay your medical bills because you’re uninsured, your community and society as a whole suffer. For example, your business or other businesses in your community will suffer when you change your spending habits due to large medical bills. Your co-workers and your work will suffer when you are sick more often because you don’t have access to health care or if your health deteriorates and you’re not as productive at work.

How Being Insured Can Changes Things



Insurance should be perceived not only as a protection mechanism, but more importantly as a partnership that allows you and your businesses to spread your wings and go where you might not have otherwise dared to go. Insurance contributes to society and economic growth and it can be summed up as follows:

       It allows different risks to be managed more efficiently;
       It encourages loss mitigation;
       It enhances peace of mind and promotes financial stability;
       It helps relieve the burden on governments for providing all services of social protection to citizens via social security systems;
       It facilitates trade and commerce, supporting businesses and economic growth;
       It mobilizes domestic savings; and,
       It fosters a more efficient allocation of capital, advancing the development of financial services.

With the rise in the cost and standard of living these days, it has become essential to have provision of finances to support your needs.

In conclusion, an insurance plan carefully selected as per your need not only works as a steady means of investment, but also provides the much needed protection of your immediate finances. Living without insurance is definitely a setback on your personal finances and can affect you in more ways than you might know.
This article is provided bycompareinsurance.com.ng, the online insurance portal for buying insurance from Nigeria’s most serious insurers in 3 simple steps


4 comments:

Sunday Simon said...

Hmmmm. Insurance companies in Nigeria hardly pay claims

Sunday Simon said...

Hmmmm. Insurance companies in Nigeria hardly pay claims

anselm okpara said...

@Sunday Simon you must be in Cameroon or does not understand the concept insurance

Anonymous said...

Sunday Simon, Insurance in Nigeria is changing for the better. Insurance companies do pay claims in Nigeria. There might be delays in time frame, but they do. Buying your insurance from Compare Insurance platform, they assist with your claims by following up with the insurance company you chose.

Recent Posts