The role of insurance in your financial well-being

You can never predict – and most often – prepare for what will happen in life? One day you feel completely fine. The next day, you get sick all of a sudden. Or your home might suffer from a fire, in which case, you would need major repairs. These unexpected events can have direct effects on your personal finances. It will eventually take its toll on you mentally, and emotionally.

This is where insurance comes in.

Insurance is a way to protect you from unexpected events – and secure your hard-earned savings from getting depleted when emergency strikes. No one wants something bad to happen to them or their family, but a sudden unforeseen financial expense, brought about by a disaster or an accident, can put you in personal debt – that is, if you’re unprepared.

Insurance is also meant to protect your financial well-being and your overall sense of security regarding your capacity to meet your financial obligations.

So having insurance under your name is important.

Think of insurance as a financial safety net for your health and properties. It is one way to manage risks in life. Examples of unplanned events where insurance coverage applies are medical emergencies, home fires, vehicle theft, and even asset loss. Assets could be anything that you own that has a monetary value. When these events happen, your insurance provider will pay you or your beneficiaries a corresponding amount to cover for the value insured, as stated in your policy. An insurance policy is a written agreement that details your insurance coverage.

There are different types of insurance in the Philippines. The most common ones are life and health insurance. As their name suggests, these insurance help cover expenses caused by a sudden illness or death. Other types of insurance are home and vehicle insurance, which you get once you buy a new vehicle.

Another type of insurance offers financial protection to your small business, tools and equipment used, and other assets that are critical in your operations. There are also insurance offered, which covers personal assets, like an expensive camera or a gadget that you use for sidehustles or freelance work.

Depending on your needs and age, insurance coverage can be anywhere from a few hundred pesos a month to thousands. You may choose the ones that fit your lifestyle.

When choosing an insurance provider, you should always choose one that offers the best terms for your specific needs. Speak to an insurance representative about the exact coverage for each policy.