Risk management and insurance

RiskLife is full of risks. As the saying goes: nothing ventured, nothing gained.

Life’s risks range from the not-so-serious through to the deadly serious. From the risk of missing the bus or being late for a meeting through to the risk of catching the flu, getting cancer, having a serious accident or dying at a young age.

Most risks can be avoided, minimised or managed. For example, the risk of missing the bus can be avoided by leaving home earlier, and the risk of getting run over can be minimised by exercising a bit of common sense when crossing roads.

Insurance is all about getting cover for the risks that you can’t totally avoid.
With insurance, you ‘offload’ the financial cost of risk to an insurance company, while the insurer absorbs that risk by spreading it among all its other policyholders.

While it may not seem like it, insurance is really the opposite of gambling. With gambling, the winners collect off the losers. But with insurance the losers – that is, those who die early, have their cars stolen or houses burgled, etc. – collect off the winners, those who don’t suffer those misfortunes.

Everyone has varying chances of having their car stolen, their house broken into or burned down. On a more serious level, around one in three people will at some stage be off work for three months or more due to illness or injury, and not everyone lives long enough to collect New Zealand Super. If those odds are of concern, you should take out insurance.

What happens if you die before the mortgage is paid off and the children have become financially self -sufficient? Life insurance can fix this issue. All Milestone advisers have subscribed to specialist insurance research so we can analyse all personal insurance policies and identify the best value for money policy for each person. It is certainly not a “one size fits all” situation when it comes to purchasing insurance.

Give us a call to discuss your needs.