Why I love to pay insurance premiums
BY BOB LAND
Monday, May 20, 2019
Everyone loves paying their insurance premiums, right? Sort of like going to the dentist.
I dislike those invoices from the health, life, disability protection, auto, home and long-term care plans as much as anyone. And I am an independent insurance and investment agency owner, soon beginning my 27th year. Why do I pay for them?
■ It comes down to love. That is what insurance represents to me. Keeping financial promises to those I love the most. I can guarantee my wife and my kids absolute financial guarantees. When I am sick, if I become disabled, one day die or when I likely chronically age .. . it does not matter. I am prepared. My intended financial outcomes are going to occur. Because I have planned. Our home is secured. My kids stay in the same schools. Our cars are paid for. One day I will be able slow down a little and enjoy the grandkids. We have "Peace of Mind" now because of insurance.
■ It comes down to personal responsibility.
On our wedding day- I said to my wife, "I do". I pledged a promise. Like the famous Platters song "With this ring," I promised to always love her. But it was more than mere adolescent emotion. Maturing love is practical, is patient, kind, changes diapers, de-ices the windshield, is available to help, pays bills and plans. Insurance and Investments help me do that, within my budget, by multiplying my financial resources to cover likely risks in life. It was no longer my parent's role to pay for my life. It was not my neighbor's role or the government's role. I celebrate the opportunity to build a wonderful life for my family through planning.
As Teddy Rosevelt penned: “I choose not to be a common man. It’s my right to be uncommon if I can. I’ll seek opportunity, not security. I do not wish to be a kept citizen, humbled and dulled by having the state to look after me. I want to take the calculated risk, to dream and to build, to fail and to succeed.”
■ It comes down to maturing. Over time I learned, with discipline, I could lower my insurance premiums. I could adjust it as my financial world improved. How? Through progressive short term self-insurance. My initial goal was to save $500. Later $1000 was in the emergency fund. Then shoot for three months of living expenses. This is possible when you live within your means. As my savings grew, so could my health insurance and car and homeowners deductibles also be raised. I did not need to have a super low 500 deductible, when I had an Health Savings Account or emergency fund of $1000 in cash. I have fortunately gotten to where I can afford to have a 6 month elimination period on my disability and long term care insurances. But that took us a while. It is possible to increase your savings over time and just use insurance for the liabilities your cash won't handle.
■ In summary: So pay those insurance premiums for the right reasons: Love, responsibility and maturity. Over time, build your cash and retirement savings. Work with a professional you trust to show you how to progressively wean yourself off of low deductibles and other unnecessary insurance premiums. Bet you didn't expect an insurance adviser to tell you that!
Bob Land is president of Landmark Financial Services LLC, a 26-year-old executive and employee benefits independent agency firm based in Rocky Mount and Raleigh.