Introduction
Personal risk management is about being aware of the risks in my home and in my life, and then prepare myself how to manage those risks. Insurance plays a big part in risk management. A lot of people don’t like to pay insurance premiums, but when an accident occurs and the insurance pays them for a covered expense, they thank God they had it.
Importance of risk management
By recognizing and managing risk, I save myself and my family from a possible financial failure. A risk management will allow me to live a life free of worrying about how to handle a sudden loss.
Types of risk
Property and casualty risks include my car and other vehicles, home, furniture, electronics, jewelry, cameras, etc. I have to protect these belongings
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At the same time, the premiums should be an amount I can comfortably afford in my budget. First I should decide what I need to insure, how much to insure it for, and how much I am able and willing to pay in deductibles and premiums.
I should consider that my family’s needs for insurance will change over time. For example, I will definitely need more life insurance when my children are young; I have to take into account that I will need long-term care insurance as I am close to retiring although I can purchase it for less at a younger age; I may not need as much personal liability and business insurance when the kids get older and when I sell my business.
There are multiple ways I can use to reduce my premiums such as installing a home security alarm which may save on my homeowner’s insurance. Also by increasing my deductibles, my premiums will be lower. Some risk might be acceptable. Risk budgeting is about considering what I lose if the worst happens and see if I could live with the loss. Health care and long-term care costs are increasing at an alarming pace, people are living longer, and many older Americans have seen their retirement savings decline in recent down markets. A professional can help me evaluate my health care risks and determine how to plan for
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I currently only have the coverage required by state of Michigan due to financial reasons. Other than that I have an old car that is not worth the collision, comprehensive and endorsement/riders insurance premiums.
Property insurance
As there are different home styles, insurers offer different kinds of home insurance coverages.
Since I have a single-family house, I found that the most appropriate policy is the HO-3. This policy insures all major perils, except flood, earthquake, war, and nuclear accident.
A house is the most important property a person can own, therefore a 100% replacement cost coverage is a must have. Insurers generally cover the home content between 50 to 75% of the home’s value. The most appropriate action is to make a list of home’s contents and estimate exactly the coverage needed.
Picking deductible amount could be tricky. Although as I raise my deductible I get lower premiums, I should consider how much I can afford to pay before the insurance kicks in.
One last thing to consider is coverages that don’t cost lots of money but may break my budget if it happens such as sewer back up coverage. This might cost me only $5 a month, but if the sewer backs up as it did last summer it may cause to pay a fortune to fix the damages.
Life
At one time because of being a part time student and employee, I could not get insurance though my parents, my work, or my school. I was not eligible for Medicaid, and found the cost of private insurance was completely out of my budget.
Goodman, John. Is Private Health Insurance More Costly Than Public Health Insurance? Five Principles . 9 1 2013. http://healthblog.ncpa.org/is-private-health-insurance-more-costly-than-public-health-insurance-five-principles/. 28 4 2014.
insurance coverage is important and can be obtained through government sources, employer benefit programs, or private providers.)
Health care costs affect family finances in two major ways: out-of-pocket spending, such as co-pays, deductibles, and prescriptions, and the family’s share of the health insurance premium. The United States health care spending growth continues to annually increase in expenditures that have stabilized at less than 4% per year. Rising cost-sharing is largely at...
Health insurance is currently an important issue in the United States. Everyday more and more Americans become uninsured due to job loss and an increase in premiums. These Americans add to the ever growing population of 45.7 million people who are currently uninsured (Bialik). Moreover only 27% of those uninsured are under the age of 65 (NCHC). This is staggering considering most of those who are uninsured have, or soon will, suffer from some sort of illness or injury. As a result they will not be able to afford proper treatment. Insurance premiums can range in cost from fifty dollars per month, to fifteen hundred dollars per month (Kreidler). An individual’s premium is determined by factors they choose as well as other factors looked at by their provider. The cost of health insurance in America varies depending on the controllable factors, like particular insurance policies, and uncontrollable factors, like age.
Secondly, health insurance policies are inconsistent, expensive, cumbersome, hard to discern, full of fine print and contain many loopholes. Most Canadians face a huge tax burden, rising cost of living and will not be able to pay for these additional medical expenses out of the pocket. To offload risk, most indiv...
There are huge impacts of the rising costs. Many people can not afford health insurance. Of the families that do have health coverage, 50 percent are concerned about having to pay more for that coverage in the future, while 42 percent fear they will not be able to afford coverage at all. (National Coalition on Healthcare, 2005, Facts on heal...
1. Indemnity - This can be a most expensive plan. It allows you to choose your own health practitioner and hospital. It 's the most bendable plan because it allows you to make your own decisions about well being care. You pay your bill after services are rendered and they are then reimbursed by your insurance vendor.
Although health insurance can be beneficial because providers get paid for the services they provide to the patient the insurance premiums and deductibles are in many instances way more than many families across the United States can afford. With these extremely high costs for insurance statics show that over 40 million families’ can’t afford or have access to needed health care systems. “It shows that one-fifth of Americans couldn 't afford one or more of these services: medical care, prescription medicines, mental health care, dental care, or eyeglasses (R...
Rather, it is centered around comprehension the key risks an organization confronts then going for broke at the best time in the wake of utilizing the most suitable safety measures (Valderrey, 2016). Even in the best of times, in the event that you are to oversee risk successfully, you should make to a great degree decision making ability calls including information and measurements, have an unmistakable feeling of how all the moving parts cooperate, and convey that well. In the most noticeably awful of times, risk management can go into disrepair. Recorded models can come up short, liquidity can become scarce, and relationships can get to be more grounded all of a
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Risk Management allows us to identify the problems which are unknown during the start of the project but may occurs later. Implementing an efficient risk management plan will ensure the better outcome of the project in terms of cost and time.