Using your insurance

So we left off giving our money to an insurance company to keep for us if our barn burns down.  Assuming this is a good company and they don’t run off with your money, they will pay you to rebuild your barn IF it burns down.

This is an important distinction: IF. This is where the risk comes in.  You have to decide if paying a specific amount of money is worth it.  Sometimes it is and sometimes it isn’t.  Everyone’s situation is different, and unfortunately, the future is unclear for most.

The same is true for the insurance company.  They decide if it’s worth it for them to collect and manage your money.  If the barn is already burning, can you call and buy insurance?  Nope, that’s not worth it to the company.  They are upside down before they begin. Think of it as a preemptive strike – protecting yourself BEFORE something happens and not having to worry about paying for it AFTER.

Please understand, just because you pay insurance doesn’t mean you are entitled to get that money back.  I hear all the time, “Why do I pay insurance anyway?”  It’s for that ONE TIME bad accident, fire, tornado etc.  If insurance companies paid out on everything, I guarantee,  you would be paying  A LOT more money than you already are.

-Kristin Francy, Insurance and Financial Service Agent