04/10/2022
Let's go back to the basics. How insurance protects the ones you care about.
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What Is Insurance?
Let's go back to the basics.
Q. What is insurance?
A. According to Oxford Languages, insurance is an arrangement by which a company or the state undertakes to provide a guarantee of compensation for specified loss, damage, illness, or death in return for payment of a specified premium.
It is important to protect your greatest asset, which is your ability to earn income.
If you die today, how will your family survive, with you being the sole breadwinner?
2) if you are diagnosed with a major illness, what will happen? Permanent disability.
Any individual should be able to protect themselves against risks that we have no control over. Risks that affect our ability to earn an income - diseases. people liquidate assets to offset bills.
Your family will still need finances even if you are not there.
If someone is diagnosed with cancer, what will happen if you had taken the insurance policy? What solution are you offering?
A. Critical illnesses as an insurance. You get paid a lump sum to help you meet a portion of the medical costs so that you are not financially strained.
When you have insurance, there is also peace of mind. It's like having a roof over your head, so that even if it rains, you are relatively safe.
Protect your ability to earn income, your ability to protect your people and your ability to meet your financial obligations.
Take care of your family even if you are not there or if you are unable to go to work to earn an income.
Consider a parent whose family has an expense amount of 100,000 shillings every month, and this parent is the sole income earner. If this parent can no longer earn this money, there will be negative 100,000/- every month in that family's budget.
If this person had 12m shillings cover - and insurance is paid. Life insurance is an immediate estate which pays immediately in the event that a protected risk occurs - the family can invest this money and generate 100,000 per month.
An example of such investment is unit trusts. If the unit trusts gives 12% per year, that is equivalent to 1% every month. 1% every month is 100,000/ so the family can meet the needs the way the parent used to. The 12m will act as the source of the income that the parent used to give them.
Q. If someone is diagnosed with critical illness, they get a lump sum?
A. Yes, they are given a lump sum. Basically, we are trying to alleviate the financial burden that you might be having.
