To put it bluntly, insurance is to help each other and help each other solve economic difficulties. In our traditional society, when something unexpected happens at home, we will inform our relatives and friends and ask them to help, but their relatives and friends are limited and their power is limited.
The poor need insurance more, because they don't have enough money to deal with risks, accidents and diseases, which will have a devastating impact on them. They have no money to treat diseases and injuries. High medical expenses can be said to be beyond the reach of the poor without insurance.
Having a suitable insurance can largely resist the disaster caused by the occurrence of risks, ensure the money for medical treatment after illness and injury, and ensure the continuation of family life after accidents.
How to buy insurance reasonably
For the general insured, only by clarifying the six core issues can we buy the most suitable insurance.
The answer to this question is simple: people of any age need to buy insurance. Some people will ask, I am so young, do I need to buy insurance? In fact, anyone at any age who encounters accidents and diseases may cause extra expenses to the family economy. Although we will have some basic protection, which may come from our own income, family or social security, many times these are not enough to resist risks, so we need a commercial insurance to supplement them. Except accident insurance, everything is cheap when you are young. If you need to buy insurance, the sooner the better.
If the child is underage, parents should consider accident insurance, critical illness insurance and medical insurance. Choose those insurance products whose insurance coverage is increasing year by year or with dividends to offset inflation. Some educational products with investment function can also be considered simultaneously when parents are well-off.
Parents of minor children should establish adequate protection for themselves. You need to buy yourself higher life insurance, accident insurance and critical illness insurance, because the protection of parents is the real insurance for children. Young people who have not been married for a long time should pay attention to their own accidents and accidental medical insurance. You can consider a certain amount of term life insurance to make full preparations for repaying your parents' kindness. If the income is acceptable, you can also consider critical illness insurance together. After marriage, family responsibilities are the heaviest, and it is also the peak of income. Security should be comprehensive and sufficient. In addition to security products, endowment insurance should also be included in the agenda.
Insurance for retired people seems to be dispensable. Due to the high insurance premium rate at this stage, we should mainly rely on the pension and child support accumulated in the early years. In order to reduce the pressure on children, you can also insure some types of insurance such as accident insurance with lower premiums. If inheritance tax is levied in China, in order to pass on the property to children as much as possible, you can also buy high life insurance to avoid tax.
Security is the most basic function of insurance, and we should also pay attention to its other important function-financial management. China is in the era of negative interest rates and is expected to raise interest rates. The financial management function of insurance is in the weakest period, and the yield of traditional long-term life insurance with return function is at the bottom of history.
The first step: the original intention of insurance is protection. The most suitable choice to buy insurance now is to buy guaranteed products, mainly life insurance, accident insurance, medical insurance, critical illness insurance and so on. When choosing insurance products, it is recommended to give priority to dividend products, because such products can resist inflation and prevent the policy from depreciating.
Step 2: After the basic guarantee is established, you can supplement some investment-oriented insurance products as a sound financial management method.
Insurance products are as valuable and useful as the goods in the supermarket, but not everyone needs them and has the strength to buy them.
What is the best coverage?
How much insurance should a person buy? This is a difficult question to answer accurately. Because life insurance (60 1628) is different from property insurance, its object is human life and body, and its value cannot be measured by money (although some scholars have put forward some calculation methods). The demand for insurance protection will change with the changes of family structure, income and external economic situation. It is recommended to check the insurance contract frequently and increase or decrease the insured amount and types of insurance in time.
Generally speaking, the estimation methods of insurance amount are divided into life value method, family demand method and pension reserve method, and the combination of the three determines the level of insurance amount:
The law of life value is to consider how much insurance should be purchased according to a person's life value. It can be divided into three steps: estimating the average annual income of the insured in the future; Determine the retirement age; Deduct various taxes, premiums, living expenses and other expenses from the annual income, and estimate the insured amount with income × age.
The family demand method can ensure the family's total living reserve when the accident occurs. The calculation method is to deduct the living expenses, education expenses, alimony, external liabilities and funeral expenses required by the family from the existing assets, and take the balance as the rough estimation basis of the insured amount.
The estimation method of pension reserve method is to determine the demand first, and then calculate the gap. When determining the amount of old-age insurance, we should examine our own old-age planning, measure the demand and estimate the income. Determine the actual demand for old-age care, and then determine the funding gap for old-age care. See if you have social security pension, fixed assets investment income (such as rent), dividends, child support, etc. It is suggested that the supplementary pension obtained by purchasing commercial pension insurance accounts for 20% ~ 40% of the total pension expenses. Finally, determine the actual coverage of old-age insurance. Generally speaking, high-income people can mainly rely on commercial endowment insurance. Low-and middle-income families mainly rely on social endowment insurance, supplemented by commercial endowment insurance.
How much premium is the most suitable for each year?
Different life cycle, family structure and income and expenditure require different insurance products, and the premium expenditure will be constantly adjusted.
Generally, family funds can be arranged according to the simple family financial management rule of 432 1, that is, 40% of income is used for housing and other investments, 30% is used for general family sexual life expenses, 20% is used for bank deposits in case of emergency, and 10% is used for insurance. Insurance is a security requirement. Too low premium expenditure means that it can't bring enough security, while too high premium will bring more pressure. Therefore, it is most appropriate that the premium expenditure is equivalent to about 10% of the annual income.
Further reading: How to buy insurance, which is good, and teach you how to avoid these "pits" of insurance.