What is Insurance?

 What is Insurance? This is a simple enough question to most people fair enough, but very often insurance is a word that might be easy to explain in theory but not in practice. The term is thrown around loosely by many people either being sold as a package or used to describe certain investments only to realize the disparity between the package that we bought, an investment we made, or what we were told during a pitch and the true meaning is worlds apart. In this post, we seek to look at the true meaning of insurance from the financial services sector perspective and the true definition of the word itself.

According to the Oxford Advanced Learners Dictionary, insurance is an agreement with a company in which you pay them regular amounts of money and they agree to pay the cost, in the event that you die or there is loss on your part. Other authors suggest that insurance is simply a contract between an insurer and the insured on which the former is to guarantee protection in line with certain terms and conditions for a fee, this is the generally agreed definition from the financial services sector. In its truest form insurance is simply the protection from loss and before going into technicalities or being charmed I believe this is what we must look for every time the word is put forward. 

Most young adults remain uninsured today because insurance seems like a burden on their wallets and the fundamental reason stems from the flawed definition of what insurance is and how it has been packaged. In its simplest form insurance is perfect for everyone, let's face it who wouldn't want to be protected against any loss but the monthly commitments and the technical nuances might be disconcerting for most. I'm no stranger to the feeling.

In conclusion, whatever thoughts you have on insurance we all want protection from loss, we all want guarantees that when things go wrong there are going to be little disruptions to our normal lives. So next time the word pops up in your circles seek the truest definition of the word in what is being proposed, look for the protection, the guarantee, and recovery. In my eyes, that is what insurance is and as a young adult, this is the version I want to hold to heart and brace myself to face the world. Life is full of uncertainties we can rest easy with some protection.

Thank you for reading through this article friends, I believe insurance is an aspect that affects our daily lives whether we have insurance or not and it is a topic that I want to explore further to help you and myself understand insurance better in order to make informed decisions. So stick around and let's continue to learn together.

Don-Insurance