Welcome to Insurance Planner .com!!! This site is probably not what you might expect. The purpose of insurance Planner .com is not to sell you insurance, as the title insurance planner might imply. Rather, it is a primer on various types of insurance, when buying insurance makes sense and does not, and how much insurance makes sense. Many people greatly over-insure, and pay out a small fortune over time unnecessarily. Some people selling insurance for a living might take issue with some of the discussion. Page 4 of the site contains a blog, and they can feel free to express their opinions by writing articles on insurance topics. This site will discuss car insurance, life insurance, home insurance, health insurance, motorcycle insurance, annuities, and other forms of insurance.
Many people believe insurance is a good investment. It is generally not an investment at all, and when it is partly an investment, as in the case of annuities, it is usually a poor investment. At it’s foundation, insurance is paying to transfer risks you are unwilling to take. You buy car insurance in case you get in an accident and need insurance because you cannot afford to pay for someone’s injury or to replace or repair damaged cars. It might surprise you to know that, on average, you pay out much more to the insurance company than you ever expect to get back, but it allows you to sleep better at night. People often buy much too much insurance, and lenders play a large role in this process. Home lenders and car lenders usually require more insurance than you need, to protect their investment, their loan to you, not to protect you! They want you to pay back your loan, even if something bad happens to you, your house, or your car. The insurance company calculates the probabilities of a loss, charges you the average amount they expect to pay you for losses, plus amounts to cover their operating expenses, and their profits, so they charge you much more on average than they expect to pay you.
Insurance makes sense to transfer risk for catastrophic losses. Non-catastrophic losses can be self-insured. The definition of a catastrophic loss varies from person to person. A millionaire can probably afford to fix a damaged fender on his car with little trouble, but might consider causing a personal injury a catastrophic risk, so he might get car insurance with heavy liability coverage, but have no need for collision coverage. Someone else with little money might need full auto insurance coverage to transfer all of the risk and sleep better at night.
If you find this discussion interesting, please read on. The insurance discussion goes into greater depth on other pages.