The Psychology of Insurance and the Financial Risk of Being Without It

A large part of having insurance is peace of mind. Without it, we would worry about what might happen that could spell financial ruin. We purchase insurance because we can afford the premium whereas we would not be able to afford the financial burden should our vehicle end up being written off or our business getting sued.

So, let us think of different scenarios relating to the different kinds of insurances that are available from the likes of onesureinsurance.co.uk for our online convenience.

Motor Insurance

A part of motor insurance is about insuring for road risks. It is also a legal requirement to insure ourselves against the damage we might cause to the vehicles of others. Another element to it is to have a fire and theft cover. If we reside in an area where theft is rife, then it is a weight off our mind that the financial side of our asset is protected. Some will become attached to vehicles for sentimental reasons, which insurance does not cover, but many will see them as merely a means for commuting from A to B. So, it might be about balancing a vehicle’s value, thinking perhaps about its age and mileage, alongside the need for greater cover. In terms of fire, we cannot rule out the fact that arsonists exist everywhere. It is their burning desire to watch something burn, and particularly if it is someone else’s property.

Comprehensive insurance is important where vehicles are newer, on finance agreements, or where luxury models would mean a great loss should they sustain significant damage. A comprehensive policy provides the ultimate insurance package in that it protects a vehicle in every way. The rise in premium can be kept to a minimum by the compulsory and voluntary excesses that can be applied to the policy.

Home Insurance

It is a parent’s job to not only protect their children but their property and inheritance too. If you own your home, then you will want to protect it for future generations to live in. This is where building insurance will be important to make sure that we can afford to repair any amount of damage. A house can be at risk from storm damage more often because of location, as well as fire because of the gas and electrics inside our home. We can ensure that we maintain these as we are required to but this will only reduce the risk. It is an extra peace of mind to have insurance too. Insurance can protect our homes and contents. Most of the possessions inside our homes are likely to have been bought by ourselves and so our money is tied up in them. We cannot recoup the money if the item is lost and we do not have insurance.

It has to be said, though, that we cannot insure against sentimentality, we can only insure against financial loss. An insurer can only promise to put us back into the same position financially before a damaging event occurred. We can, however, feel better in the knowledge that we will not lose everything when we can be insured against most of what life could throw at our home.

Liability

It seems to be trending everywhere that where blame can be established, someone will be trying to sue us for compensation. No matter how well we try and live our lives personally, or in business, we are never fully protected from that person who thinks we have been incompetent. Our workmanship will be judged by customers with different standards and expectations who may prove to be our enemy. Then, it only needs a third party in authority to agree with them then compensation can be due. A business may or may not be able to deal with its amount.

Substantial sums of money have been paid out in cases of negligence. For injuries that have been life-changing or life-limiting in particular. If the accident occurred on or around business premises, then it is the responsibility of the owner to keep employees and members of the public safe. If all precautions are deemed by health and safety executives not to have been taken, then compensation claims can be high and unaffordable by businesses. We can prevent this possibility as a business by insuring against such an eventuality. As much as we train staff, we cannot rule out something happening. Equally, a piece may fall off our roof and injure someone when we thought we had it well maintained. One just never knows what will happen. Life is never predictable.

So, some thoughts above on how insurance can help us through its financial and psychological protection. The financial protection it offers can be seen as defining insurance services as also peace of mind services.

We then just have to think about which optional insurances provide us with greater peace of mind.

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