How does insurance benefit a financial plan

Thus, it will not only provide protection but also allow you to generate returns that can help you meet your financial goals. The policy proceeds received from the life insurance company are also exempt from tax. Medical Insurance: Unforeseen medical emergencies and critical illnesses can put you at a disadvantage. Firstly, they can reduce your ability to earn, and secondly, they can increase your medical expenses.

The appropriate medical insurance policy can help you mitigate these risks such that you do not have to dip into your savings to meet your medical expenses. There are also medical insurance policies that pay a lump sum amount for the treatment of critical illnesses. This can help you not only meet the expenses but also support your family in case of reduced or loss of income. Auto insurance: While this policy is not for everyone, it can be an important category to consider if you own a vehicle.

An auto insurance policy can protect you from considerable liability in the event of auto theft or damage.

It can also provide coverage for meeting the expenses of another vehicle that you might have damaged in an accident. Having this policy will ensure that such events do not burn a hole in your savings and investments. The insurance policy that you purchase should consider your overall financial plan, your asset and liabilities, the return requirements of your portfolio, and your risk profile. However, before purchasing the policy you must understand all the features, terms, and conditions of the policy to ensure that it fits into your overall financial plan.

Annually, you should also review your insurance and make required adjustments. If you require any help, consider seeking the assistance of a financial adviser. Being aware of financial implications and potential risks is critical. It could also help in covering the expenses you or others in your vehicle might incur due to an accident with the uninsured motorist.

Auto insurance is crucial for people owning a car. Most of the countries require you to have auto insurance before you could register your vehicle. Your medical insurance policy could reimburse all medical expenses during your hospitalization.

It is not intended as investment advice and does not necessarily represent the opinion of Protective Life or its subsidiaries. Learning Center articles may describe services and financial products not offered by Protective Life or its subsidiaries. Descriptions of financial products contained in Learning Center articles are not intended to represent those offered by Protective Life or its subsidiaries.

Neither Protective Life nor its representatives offer legal or tax advice. We encourage you to consult with your financial adviser and legal or tax adviser regarding your individual situations before making investment, social security, retirement planning, and tax-related decisions.

For information about Protective Life and its products and services, visit www. Companies and organizations linked from Learning Center articles have no affiliation with Protective Life or its subsidiaries. Why get life insurance. Life insurance not only provides peace of mind to you and your loved ones but can be an essential part of a sound financial plan. As you grow and move through life, you could appreciate the many benefits.

The following are four common areas in which life insurance can play an integral part of your financial plan: Paying off a mortgage Payments, taxes, insurance and interest.