Hakuna Matata means “No worries for
the rest of your days” to the vast majority of people from the Disney classic,
‘The Lion King’. Hakuna Matata also comes from a Swahili phrase meaning “There
isn’t a problem or trouble”. It’s to have a peace of mind in life, to know that
everything will be fine regardless of what happens. Some people call it a
vacation, I call it insurance.
Insurance was a $1,041.5 billion
industry, in just the US, in 20131 and continues to grow at a rapid
pace as the world’s population increases. A very large industry when they
market the only product that you can’t see, hear, taste, smell, or touch.
Insurance companies have always had the struggle of selling piece of mind to
consumers, the very essential of what Hakuna Matata is at its core. When you
walk into a fast food restaurant and buy a meal, in exchange for your money,
you receive a product that hits all five of your senses. With insurance, you pay,
what some would say is a very steep price in exchange, for a product that you
may never use. “On average, a driver will have an accident claim once every
17.9 years”2 says enhanceinsurance.com. I would say most people
would say their money could be better spent elsewhere and that’s just not my
opinion. According to a 2012 study by the Insurance Information Institute,
every one in eight drivers were uninsured with some states having up to 26% of their
drivers being uninsured1. Most states are changing their laws to
decrease this number, but this is a trend amongst all types of insurance. The
underlying issue here, and not just with auto insurance, is that more and more
people do not understand the true value of having insurance.
The purpose of insurance is to make
one whole again after life happens, not make them rich. This is the first myth we
need to understand, insurance doesn’t exist to pay you more than the cost of
what is being covered. So when we have a loss, we shouldn’t expect this to be our
big break towards financial freedom, but rather insurance picking us up,
dusting us off, and allowing us to go on our merry way.
Insurance comes in many shapes, sizes,
and forms; we need to understand that every type of insurance depends on our
direct needs and that our needs will change over time. This means that insurance
doesn’t follow a one size fits all model. We need to fully understand our
policies and coverages and actually attend policy reviews to update our
policies and coverages as life events occur. Do not overlook the benefit and
value of having these meetings.
Your auto premium will probably
increase. This is a simple fact that we need to come to learn, accept, and
expect. It doesn’t necessarily mean you filed a claim the prior year and in
some cases, your premium may even decrease. We should look at insurance in a holistic
way. When we are stuck in traffic and realize it’s because of an auto accident,
we need to realize that insurance is paying to cover the losses in that
accident. That means our premium is going to help settle the loss from that
person’s accident. The same can be said when we’re the person involved in the
accident and other people’s premiums are paying for it. Holistically, when the
cost to settle claims is greater than the premiums being received, insurance
companies raise everyone’s premiums to be able to continue to cover all the
losses for the upcoming year. The best way to look at a premium increase is
that we’re all in this together just like how the cost of living continues to
increase, which affects all of us.
Life insurance is seen as another bill
to some, but it should be seen as an investment and even a gift to all. Many
Americans believe they don’t need life insurance. In fact, 41% of US adults
don’t have any life insurance, that’s equivalent to 95 million Americans3.
The biggest gift we can give to our family and those we leave behind when we
move on is Hakuna Matata, the peace of mind that their standard of living will
not change and that they will still be able to live without incurring any
hardships from our departure. Life insurance allows us to do this and the death
benefit our loved ones receive far outweighs the premium we pay. It’s hard not
to call it a gift when we can ensure our child’s education, the mortgage being
paid off, our spouse not having to pay out of pocket for our funeral, and so
forth when we’re not around.
If we simply take the time to learn
and uncover what our needs are, take the steps to ensure we are adequately
covered and don’t just have coverage, understand our policies and coverages and
revisit them as life events happens, leave the best gift we can for our loved
ones in life insurance, then we will then find Hakuna Matata, ‘no worries for
the rest of your days’. Insurance is our worry-free philosophy.
References:
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