Insurance: The taboo word for many

Insurance: The taboo word for many

Often, we cringe about certain words that we dislike. It feels like pans and saucers come flying and go straight to the floor, clanging like it is Chinese New Year! This is the social phenomenon whenever we talk about insurance to the public.

“Insurance is for the dead people.” is an everyday tune to just about every insurance agent all over the world. A large majority of people correlates it with dying, illnesses, and accidents – all sorts of bad events that you can hear of. This connotation is a product created by the superstitious generations before us. They falsely believed that if you buy insurance, you will die. They thought that it was a waste of money since your beneficiaries are only those who will benefit from it while you were the one who paid for it. They also thought that insurance companies and its agents are all scams – that they are only after the money of the people they “insure.” They claimed that only God is the only one capable of insuring people.

While the last statement turns out to be true, this is only true if we are referring to insuring our spirit to have a guaranteed ticket to Heaven. Not being blasphemous but God, as omniscient as He is, is not responsible for protecting your loved ones if ever He calls out for you to go Above. It is not the workload of your church pastor, of your aging parents or worst, the savings account of all your relatives, but is yours.

This responsibility is one of the most “cunning” things on earth since it creeps out of the shadows while you are busy basking under bright light. It is like an assassin with its katana sharpened to cut all your financial sources and juices you up with whatever is left on you to spare. In the end, it will make you feel devastated and incapable of doing anything.

For all that it is worth, we can do something. We need to know our true allies and the real enemies. We should be educated financially. We should know where to put our funds aside from partying, gadgets and other “useful now, useless later” equipment. We need to become the generals in our own battlefield – with your insurance agents, financial advisors, and the insurance companies as your pieces to win the game of life.

We have three basic enemies – dying too soon, living too long and being disabled. We have three fake allies – saving up money in banks, binge-shopping and being close-minded. We have three main strategies to point out – to beat inflation, to know the different investment mediums and to know money management. And lastly, we have things to delete in our system – getting rid of the “no” thinking, being reliant on our parents, promoting impulsivity, making “saving up” as the last priority and being too crooked with debts and loans! We should start looking for the best offensive piece you have – a stable and committed insurance company.

We ought to look for some factors in an insurance company. First, know the Net Worth. It is basically the assets minus the liabilities of your company. Then we have Net Assets or the things that the company owns benefits from or has use of in generating income. Next stop is the Net Income or the company’s total earnings minus all expenses and taxes. A nearby criterion is the Net Reserves or the actual money of the company in case it needs to liquidate all its assets for all its clients. We might also go and look for the paid-up capital or the amount of money received from shareholders. Lastly, we should not turn an eye away on the company’s investment at cost. It comprises all investments in forms of variable unit-linked insurances, mutual funds and stocks.

After looking for the best insurance company, we should go for your messenger. Just like in Greek and Roman wars, you need to have your Hermes or Mercury. Find a trustworthy insurance agent. Usually, there are insurance agents in your network. In case there are none, contact the insurance company for an appointment with one of their best agents so that your case will be handled.

Well, we have both the company and the agent but what are we worried about? Why do we need to avail insurance? To answer: Insurance is your “other self” in case you die – it would be the one to provide for the financial needs of your family. It is also your shield against critical illnesses, premature accidents, disabilities, dismemberment, and hospitalization costs. Insurances are also used for matriculations, preparation of retirement funds and estate planning. It can also incur savings in the form of dividends. Basically, these are the main benefits of insurances. It provides for your long-term goals like retirement, health funding, and extra savings.

But insurances today modernized up to the point that you can avail investments on its side as well. VULs or Variable Unit-linked plans are insurances with investments through the partner mutual funds of the insurance company. It means you get to invest in fixed securities, money markets, government and corporate bonds, company stocks and shares. While it may cost a bit, it quickly erased the lackluster of traditional insurances. It can also provide passive money for the attainment of your medium-term goals like traveling, owning a car, buying a gadget or pursuing a hobby. It is also the best option if you have spare cash sleeping in piggy banks and savings account.

It may seem hard to start, but a small step is all that matters. Aside from all the benefits mentioned, we will gain the discipline, the love for the family and the preparedness against financial burdens.

So, the next time you come across an insurance agent, instead of being afraid or aloof to him/her, try to listen first to what s/he will tell you. After all, we believe that one life saved is one less individual to deal with. It is a war, and we are oftentimes neglected and rejected as allies. The worst event is seeing you being dwelled by all sorts of financial burdens, then you quickly go looking for us while saying “I need you now, let’s talk about what you offered before.” – but only to find out that the only thing that we can do is to console, as we helplessly reach out to you with sympathy.

Jose Angelo, or simply “Gelo”, is an advocate of financial literacy and is a firm believer of insurances and investments. He is working as a premier financial advisor of one of the strongest insurance companies in both the Philippines and in Asia-Pacific: AIA-Philam Life. He is currently taking up his M.A. in Psychology and is a registered Psychometrician. He is also a teacher, a researcher, a musician, a badminton enthusiast, a writer, a mental health affiliate and a social ingredient during parties!

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