Why do I need insurance?

There are lots of different types of insurance and you can insure almost anything, if you can find an insurer that will agree to cover it.

To decide whether you want to get insurance or not, you need to consider a few things. Take the time to think about is important to you, and what you do and don't care about.

To use some basic examples, imagine you had a brand new mountain bike. It would:

  • Cost about $3000 to replace

  • There is quite a good chance that someone might attempt to steal it or that it may get damaged

  • You use that bike on the weekend for your business. No bike, no business!

Weigh up these questions - do you think insurance would be worth having in this situation?

However, imagine you had a graphic calculator. It would:

  • Cost about $90 to replace

  • Might get stolen, but it isn't as likely

  • If you lost that graphic calculator, you might not miss it much - and it would be easy borrow someone

Now weigh these up - do you think insurance would be worth it in these situations? Now imagine if it was a car, a house, a building, travel plans or some other expensive asset.

You are probably more likely to want to insure your assets

Am I at risk if I'm not covered?

You may not realise it, but you are constantly managing and assessing risks in your daily life. For example, you might ask yourself:

  • Is it safe to leave my laptop in a car while I go to the mall?

  • Is it a good idea to stay up an extra hour to watch your favourite TV shows when I have an important meeting, exam or event tomorrow?

  • I'm always losing things, should I buy a second hand phone that costs little to replace or should I buy an expensive one and hope that I don't lost it?

My Risk Online Tool

My Risk is a tool on the Know Risk https://knowrisk.com.au/ website that helps you understand you and your circumstances to guide you in discovering your areas of risk and how to deal with them. Answering the following simple questions could save you time, money and heartache!

https://knowrisk.com.au/myrisk

Credit: ANZIIF