The value of insurance during a crisis

When the coronavirus disease 2019 (COVID-19) global health crisis gravely hit the economy and stirred future uncertainties, many have become more conscious about their financial security.

During the first six months of the pandemic, the share of retail consumers who ranked financial security as one of their top three concerns grew from 36% to 50%, according to a 2020 research report by professional services firm Accenture on how the pandemic changed the behavior of consumers towards insurance.

The research also revealed that the value for money rose among consumers in 2020, climbing to the top priority from its fourth place in 2018. It reported that money becomes the most important factor when consumers deal with banks and insurers.

“Health, safety, and financial security are more important than ever to consumers during the COVID-19 era,” Accenture observed. “While consumer reactions vary, preventing and recovering from losses through insurance has become essential to consumers’ well-being.”

As the attention over personal and family health and the fears for finances are escalating, the research stated that insurers could therefore broaden and deepen their relationships with their consumers by providing protection to their finances during this uncertain time.

Having insurance mainly functions to avert and recover from financial loses. Insurance can also support people, including their loved ones, not just in financial aspects.

Currently, as everyone struggles due to the public health crisis, “getting health insurance in the Philippines can be one of the smartest decisions you can make,” wrote BPI-Philam Life Assurance Corp. on its website.

The insurance company warned that hospitalization costs could put a significant damage on one’s savings. And as the risk of COVID-19 still persists, bills could also continue to increase.

“Getting a comprehensive health insurance plan means you can be prepared for most of the hospital expenses you may incur because of the illness,” BPI-Philam said.

There are health insurance plans that do not just cover COVID-19 costs, but other illnesses as well. Hence, it is important to look for a plan that can help and protect oneself and the family even after the pandemic ceased.

Additionally, BPI-Philam believes that “investing in your health can also help you grow your wealth if you choose an insurance plan with investment options tied to it.”

It perceived that this kind of set-up could make two winning results such as decrease in medical bills and increase in long-term savings funds.

“With your apprehension for medical expenses out of the way, you can go ahead and continue planning for your family’s future,” BPI-Philam said.

Moreover, keeping health savings in place could likely aid one’s health too by getting rid of issues that cause worries. “Without that added stress and pressure weighing down on your shoulders, you will indeed have a more positive disposition and feel safer no matter the situation,” the insurance company added.

While health insurance is apparently useful amid this crisis and other medical issues, another category known as life insurance can provide financial security for various matters. It is also a kind of insurance that supports during and beyond the holder’s lifetime.

According to another story from BPI-Philam’s website, life insurance is like a “fool-proof protection” for a person and his/her loved ones upon the occurrence of most threatening situations.

“By getting insured, you have the ability to prepare for anything that may happen in the future — be it illness, hospitalization, retirement, or even death,” it said.

This insurance drives a person to save and therefore enables him/her to curb the tendency of spending more. Afterwards, it will protect one’s income when unexpected expenses happen.

Furthermore, life insurance can be reliable when the holder begins to fulfill his/her significant plans. “With money set aside and safely put away in life insurance, you can be confident that when you decide to bring your future plans to fruition, the funds will be there and ready for your use,” BPI-Philam said.

And when the chosen type of life insurance has a built-in cash value, which is invested in stocks, bonds, and mutual funds, it can also allow the person to earn higher returns and eventually attain his/her financial goals in a shorter period of time.

Yet, most importantly, life insurance maintains to support a holder’s dependents in financial terms even if he/she is not around anymore.

“[It] secures your family’s future and frees them from financial worries. It takes care of expenses like mortgage or a college education, which you would no longer be able to support,” the insurance company explained.

Since life insurance can guarantee assistance for potential finances, it can thus deal with one’s concerns over the lives of his or her loved ones and if there are sudden events that would involve large expenses. This protection can let the holder experience a peace of mind in spite of the constant uncertainties at present and in the future. — Chelsey Keith P. Ignacio