I don’t know about you but whenever I hear a new word or something I am not very familiar with, I like to do my research on it and find out everything that I can about it. I think this case applies to that. We know a little about what insurance is but, do you know insurance risk management is? Probably not! I mean obviously when you read the word you might get an idea of what it means but, vaguely so, I want to further your knowledge and tell you everything you need to know about insurance risk management. You are welcome.
What does it really mean to manage risks?
In today’s financial world, there are many risks involved in any financial decision that is made but, there are stops and controls a company can implement to minimize these risks. For example, if you own a company that is surely at risk of catching fire, then getting insurance would be the obvious solution for this right? Exactly! Now, risk management in the financial world is a term that it is more related to money loss and even though when a person gets insured, money is also involved in the process, but with insurance you are covering risks that are more like risking accidents, death, etc. But, at the end of the day the same goal is being reached, diminishing risks by taking the necessary steps and decisions to do so.
Do I really need insurance to manage risks or are there any other ways to do so?
If you are currently in a big family with children and financial things to cover, wouldn’t you want to family to be covered on a financial level at all times whatever happens or not? Obviously! So, I think the most mature and wise decision you can take is to at least get a life insurance because by doing so, you are definitely guaranteeing that whatever happens to you (which I hope does not but we are all at risks of accidents), your family will not have to worry about inheriting all the debt and bills you had to pay as you already had made smart decisions before this event so, the best way to go at all times when risks want to be managed is to get an insurance, seguro, whatever you want to call it but, just get an insurance before you regret not doing so and it’s too late!