Protect Yo'self: Why Insurance Isn't The Enemy

resized_nyc_condom.jpg

PROTECT THAT SHIT!!  That’s right.  Just like you learned in sex ed. Wrap it up.  Protection first.  I could keep going like that but then this would be a very different post.  Here’s what I mean: Having stuff (money, things, income, couches, health, pets…) is awesome.  I am a staunch materialist.  But having stuff that could end up bankrupting you or that can vanish isn’t really having it. 

Let’s take the example of renters insurance.  My roommate and I love to have drunken brunches.  Minnie Driver called one of them – it was an epic 12 hour brunch, the full details of which will never be shared.  Anyway we love brunch.  And we have dancer friends.  And our dancer friends love brunch and booze but not so much food.  So, good for them, they get super drunk. (No judgement.)  Now what if one of them tripped over my pug, broke their own leg and in the process knocked over a candle starting a fire that not only destroyed all my stuff but my neighbors too? 

No seriously.  What would happen?

What would you do if you were my neighbor?

Yeah, I’d have my ass sued 7 ways till Sunday! (is that the right expression?)  So let’s break it down.  My dancer friend can sue me for medical bills and lost income.  My neighbor will sue me for the loss of all their stuff plus anything else they can get.  And I’m going to need to replace all my stuff. (Stuff clearly being the technical term.)  I know this sounds outlandish but each piece of this individually could bankrupt you.  Renters insurance for a one bedroom apartment in NYC that doesn’t have a lot of expensive property in it (ie. You don’t collect Faberge eggs) will run in the ball park of $20 a month.  Worth it?

Health insurance.  Get it.

Disability Income Insurance. Awesome.  Long Term Care Insurance. Get it while you can.

Life Insurance. Absolutely.  As much as you can, as young as you can.  No, you don’t need it but trust me, implemented the right way, you’re gonna love it.

Legal documents.  I’m not a lawyer.  My brother is.  My cousin is.  My uncle is.  My grandfather was.  (I’m Jewish) Here is what I do know.  There is no time in your life when having the following legal documents would be a bad idea.  Living Will, Power of Attorney, Will.  Most people don’t get any of the above unless they get a will.  I actually think that when you get a government ID or drivers license you should be required to get the living will and power of attorney. 

Let’s say for example, I didn’t have those two documents.  I, for some reason (a hot guy), am distracted while crossing the street.  I get hit by a car and am in a coma. Who can make decisions for me?  Do I want to be kept on life support?  Do I want to be revived?  Without those papers, no one knows.  And for me there are a lot of people who may have an opinion.

Mom

Dad

Brothers (2)

Sisters in Law (2)

Business Partners (2)

Best friend

That’s 10 people who all have a vested interest and could be the person I entrust with this responsibility.  But who has authority?  Only the person listed.  If you have no legal documents, this becomes a shit show.  And it can make a really tough situation even tougher.

 

I know, I know some people just “hate insurance” but here’s the deal.  You have insurance whether you purchased it from a company or not.  Insurance is basically just saying this is who has the risk.  Ifyou don’t lay the risk off on a company, you are essentially choosing to self insure.  Which means if there is an incident, you are on the line for the whole shebang.  If you own an insurance policy with a company you have laid that risk off onto someone else.  And insurance isn’t as evil as everyone thinks.  Check out this little story about the evolution of insurance companies. (My version but based on fact – look it up.)

Once upon a time, a long time ago, there was no insurance.  So when bad stuff happened to someone in your village, the village busybody would come around a take a collection to help the family in need.  After years and years of this, people got tired of being called upon for money and thought “isn’t there a way to plan ahead for this??”  And they came up with the following: we know bad stuff is going to go down, so what if everyone puts in a little bit of money every month into the pot.  This way when something does happen the family who is in need can draw the appropriate amount from that and we don’t all have to be on the hook.  Yay team!!!

And that boys and girls, is my version of how insurance happened.  Isn’t it kinda heart warming?