Why Insurance Is Important

Insurance is a foundational element of a sound financial strategy. At its core, insurance is about protection: protecting your health, your income, your property, and your loved ones against the financial consequences arising from unexpected and often costly events. While no one can predict the future, the right insurance policies can help reduce the financial impact of accidents, natural disasters, illnesses, or other claims.

Insurance can help individuals rebuild after loss, allow families to maintain financial security during difficult times, and enable businesses to continue operating even in the face of certain setbacks. Without adequate insurance coverage, a single event—like a car accident, house fire, or medical emergency—can have devastating financial consequences.

Why Insurance Is Important for Individuals and Families

For individuals and families, insurance plays a critical role in helping to safeguard well-being and ensure long-term security. Different types of insurance fulfill different needs. For example:

Health Insurance: Health insurance can help cover costs associated with doctor visits, hospital stays, surgeries, and prescriptions. Without it, healthcare expenses can quickly become overwhelming.

Life Insurance: Life insurance helps provide financial support to surviving loved ones after the insured's death. Depending on the type, it can help cover funeral costs, pay off outstanding debts, and provide ongoing income for dependents.

Homeowners Insurance or Renters Insurance: Property insurance like homeowners insurance or renters insurance helps protect against losses arising from property damage, theft, or natural disasters. It can also cover liability in case a third party is injured on your property.

Auto Insurance: Different auto insurance types can help protect you against the high costs of accidents, including vehicle repair, medical expenses, and other liabilities. And auto liability insurance is required in most states.

Flood Insurance: Flood insurance helps cover the cost of repairing or replacing your home and personal belongings after a flood event. Policies are available through the National Flood Insurance Program (NFIP) and private insurers.

Insurance helps families navigate life's uncertainties with greater confidence. For example, the birth or adoption of a child, purchasing a new home, or starting a new job are all significant life events that may warrant changes to your coverage.

National Insurance Awareness Day is a great time to revisit these changes and ensure your personal insurance is evolving with your life.

^{*Note: the terms, conditions and coverage of each policy may vary; the above represents a brief summary of each example.}

Why Insurance Is Important for Businesses

Businesses, regardless of size or industry, can face a host of risks on a daily basis. From property damage and employee injuries to lawsuits and cyber attacks, potential threats can arise suddenly and unexpectedly. Insurance serves as a key part of a risk management plan for business owners, helping to ensure continuity and financial resilience.

Here are some of the core types of insurance that businesses should consider:

Commercial General Liability Insurance (CGL): CGL insurance helps protect against claims of third party bodily injury or property damage that could occur on your premises or due to your products or services.

Commercial Property Insurance: Commercial property insurance covers physical assets such as buildings, equipment, and inventory in the event of damage or loss due to covered events such as fire, theft, or natural disasters.

Workers' Compensation Insurance: Workers’ comp is required in most states and helps provide medical and wage benefits to employees who are injured on the job.

Professional Liability Insurance: Also known as errors and omissions insurance, professional liability insurance can help service-based businesses by covering legal costs arising from claims of negligence or inadequate work.

Cyber Insurance: Increasingly important in today's digital age, cyber insurance helps protect against loss due to data breaches and cyberattacks that can compromise sensitive information.

The right business insurance policies not only help protect a business's bottom line but also boost credibility with clients, employees, and investors. A well-insured business demonstrates that it's prepared to handle challenges responsibly and sustainably.

^{*Note: the terms, conditions and coverage of each policy may vary; the above represents a brief summary of each example.}