Protecting your assets
Protecting your assets
Life is full of risks and uncertainties. That is why people buy insurance that will protect themselves, their families and their property. Of course, the decision to purchase insurance involves weighing the costs and benefits.
- If your home is damaged by fire or a storm, having insurance would help pay for repairs.
- If you become sick, having health insurance will help pay your medical costs.
- Insurance that people elect to buy is private insurance.
There are Social Insurance Programs provided by the government that also protect individuals and their families against hardships and uncertainties such as unemployment, disabilities, retirement, health care, and death of a family’s wage earner.
- Social Insurance is required by state and federal laws, and it is, therefore, mandatory that individuals and businesses (employers) pay for these programs.
|Type of insurance||What it protects|
|Health insurance||Health insurance is a type of insurance coverage that pays for medical and surgical expenses incurred by the insured.|
|Auto insurance||Auto insurance is a contract between you and the insurance company that protects you against financial loss in the event of an accident or theft.|
|Life insurance||Life insurance is a contract between an insurer and a policy holder in which the insurer guarantees payment of a death benefit to named beneficiaries upon the death fo the insured.|
|Property insurance||Property insurance is a broad term for a series of policies that provide either property protection coverage (such as damage from natural disasters or fire) or liability coverage.|
|Disability insurance||Disability insurance will provide income in the event a worker is unable to perform their work and earn money due to a disability.|
|Long-term care insurance||Long-term care insurance is coverage that will pay for assisted living, nursing home care or home healthcare in the event you are unable to care for yourself because of a chronic condition or disability.|
|Government provided insurance||The US government funds a number of insurance plans paid for by taxpayers: Medicare, Medicaid, Children's and Veteran's healthcare, Unemployment insurance, Social Security including Disability.|
How insurance works
It is important to become informed about insurance types and costs.
- Choosing insurance will require a financial commitment on your part and you want to make sure the costs are affordable.
- You can keep costs low by engaging in behavior that protects against risk. For example, a clean driving record will lower the cost of your car insurance.
Buying insurance is basically a contract that we enter with an insurance company, e.g. Geico, State Farm, Prudential and many others.
- We purchase an insurance policy and pay the insurance company fixed PREMIUMS over time in order to maintain insurance coverage.
- Payments to maintain your insurance policy would be a fixed expense in your budget.
Let’s say you buy auto insurance (mandatory for car owners in many states). Each month you would pay the insurance company a certain amount of money to insure your car and to cover you as a driver.
- If you get into an accident, the insurance company will pay for your loss in that situation. That could mean paying for repairs to your car or someone else’s car. It could mean paying for damaged property.
- Very often, there will be a DEDUCTIBLE associated with your policy, that the insurer will require you to contribute toward the overall cost.
Ultimately, the insurance company wants to make money on your policy. So, they want to collect your premiums and hopefully not have to pay any money out.
- The amount of your premium is based on a determination by the insurance company of how much of a risk you are.
- It is always the case that when an insurance company needs to pay out on your policy, your premiums will likely go up.
Major insurance companies sometimes have millions of policyholders who pay premiums, but only a small percentage might ever receive a payment for a loss.
- This is how they can take in relatively small amounts of money from individual consumers for premiums and yet pay out very large sums if an accident or other hardship occurs.
Protecting who you are
IDENTITY THEFT is a growing problem in the U.S. and worldwide affecting millions of people every year. Thieves can steal critical information about you, like your name, address, telephone number, bank account, or credit card numbers, and—most dangerous—your Social Security number.
- Although individuals probably cannot entirely prevent this theft, risks can be minimized by being vigilant and careful about protecting your personal information, especially when using computers and smartphones.
Protecting your computer
For example, if you get a supposed IRS email asking for personal or financial information, delete it or send it to the IRS at firstname.lastname@example.org for investigation. The IRS never initiates contact with taxpayers by email, text messages, or social media.
Don't be fooled by links to what looks like the real IRS website—that too could be a fraud.
If You're a victim of Identity Theft, visit identitytheft.gov Also, keep an eye on your credit report and respond to any inaccurate information. It’s always a good idea to file your taxes early—as soon as you can—before a scammer does.
Resources for learning more about insurance
Protect your identity
Never give out personal information without knowing the reason and with whom you are dealing. Once someone gets your personal information, you may be in danger of identity theft.
Identity theft is when someone uses your personal information (your name, Social Security number, bank and credit card account numbers, address) to steal from you or create new accounts in your name without your permission. Identity theft can ruin your credit.
How do thieves steal identities?
- They steal wallets, purses, and briefcases to gain access to your credit cards, driver's license, passport, and other personal documents.
- They look for personal data by going through your trash. This is also known as• dumpster diving.
- They steal your mail, including your bank statements, pre-approved credit card offers, new checks, and tax information.
- They pose as legitimate companies or government agencies to get your personal information.
- They use personal information that you shared on the Internet. Through an e-mail attachment that you open or download, they could release a virus on your computer. The virus acts as a spyware program that records what you type and the Web sites you visit and allows the thief to acquire your personal information.
- They are sometimes someone you know, such as a roommate, relative or friend because you may share your information with them without knowing they will use it for other purposes.
Identity thieves commit fraud or theft once they have your personal information. Some examples:
- They withdraw money from your bank accounts.
- They open a new credit card account in your name and run up charges. This can lead to overdue credit card payments appearing on your credit report.
- They apply for a loan in your name and take the money. This can lead to overdue loan payments appearing on your credit report.
- They buy a car by taking out an auto loan in your name.
- They may give your name to the police during an arrest and if you don't show up for the court date, a warrant for arrest can be issued in your name.
- New accounts appear on your credit report. Note: You are entitled to one free credit report each year from www.annualcreditreport.com.
Some signs that your identity has been stolen.
- There are unexplained withdrawals and charges on your statements.
- You haven't received your bills, statements or other important mail in a long time.
- You've received calls from debt collection agencies about products or services you qidn't buy.
My identity has been stolen. What should I do?
- • Place a fraud alert on your credit report with one of the three major credit bureaus.
- P.O. Box 740241
- Atlanta, GA 30374-0241
- Phone: 1-800-525-6285
- Web site: https://www.equifax.com
- P.O. Box 9532
- Allen, TX 75013
- Phone: 1-888-EXPERIAN
- Website: www.experian.com
- Fraud Victim Assistance Division
- P.O. Box 6790
- Fullerton, CA 92834-6790
- Phone: 1-800-680-7289
- Web site: www.transunion.com
- • Continue to check your credit report regularly to make sure no new fraudulent activity has occurred.
- • Close all fraudulent accounts.
- • File a police report.
- • File your complaint with the Federal Trade Commission (FTC).
- • Submit an online complaint.
- • Call FTC's Identity Theft Hotline toll-free:
- 1-877-ID-THEFT (438-4338);
- TTY: 1-866- 653-4261
- Identity Theft Clearinghouse
- Federal Trade Commission
- 600 Pennsylvania A venue, NW
- Washington, DC 20580
- Don't give out personal information to someone you don't know.
- Monitor your statements and check your credit report.
- Shred important documents.
- Protect your credit and debit cards.
- Protect the information you enter in a computer.
- Create complex passwords and change them regularly. Remember: If your password or PIN# falls into the wrong hands, you may be in danger of identity theft.
- Equifax (397-37 42)
- Trans Union
- Mail your complaint to: