The WAY to WOW Shows
Do You Need Insurance?
August 23, 2023
Automatically generated from YouTube captions; names and wording may contain errors.

[0:15] good afternoon and welcome to people making money I'm your host Kevin bemel and we are here every Wednesday at 12 30 p.m Pacific Time 3 30 p.m eastern time this is the show with the easiest uh you know transition so um but an easiest transition in the times from uh you know Pacific to uh west to east coast anyway it's uh you know private joke you all know my sense of humor basically doesn't exist but you know I amused myself I suppose anyway welcome

[0:52] thank you for being here so as I kick off today's show I'm reminded of um a line from uh I think it's an old Woody Allen movie about um you know the ultimate boredom being stuck in an elevator with a life insurance salesman or something like that um and uh um oh gosh you know now that I'm sorry I was something resonated when I said that and and indeed I've been watching old episodes of the television show wings

[1:29] that was uh very popular in the 1990s and there's uh there's an opening to an episode where um Brian the sort of more wacky of the two brothers who run the airline uh is flying with just one guy in the plane and the guy is an insurance salesman and he's going on and on and on about insurance and Brian periodically pretends to fall asleep and the plane takes a dive and the guy freaks out and Brian wakes up and he writes the plane and um you know look insurance is certain

[2:05] well it can be a very boring subject it's certainly dealing with the types of issues that are shall we say something less than Pleasant in in all circumstances right I I mean aside from the fact that when something bad happens we're typically glad we have insurance to help us um I think we would agree that we just rather the bad things didn't happen right but the reality of life is

[2:40] bad things happen from time to time and so we need to have insurance in order to make sure that those bad things do not damage us financially or do not damage us you know worse than they otherwise would have if we didn't have insurance so I'm going to go through the the various types of insurance for an individual or family okay I'm not going to be talking about insurance on

[3:16] investments like real estate that's that's a I mean there are similarities of course but it's really a different topic um and and one that would probably really require a show of its own or at least a good portion of a show of its own okay and I'm not going to get into business insurance either okay again that's a separate um category if you will there's a lot of other types of issues that come up with a business that wouldn't apply to an individual and in some cases vice versa

[3:52] okay and also of course you've got a range of size of businesses and such so that all makes it much more complicated so we're going to focus on insurance for in individuals and families now if you have an insurance agent or you've met an insurance agent oftentimes they will tell you about all these numerous coverages that you need that may or may not be the case and the reality is each of us has our own

[4:28] situation and depending on what that is that will um Define dictate if you will what types of insurance coverage we need to consider carrying okay now here's here's the reality of the situation there may be types of insurance that it would be wise for you to have and you may not be able to afford them and so you're gonna have to go uninsured in those areas okay and by the way

[5:06] that's the reality for a lot of people okay uh I mean it's I'm not saying it's a good thing but it is a thing so part of what I I hope to help you with today is to understand what types of coverages you may need and what types of coverages you don't need to worry about okay and which ones may be more important for you to focus on especially if you have limited financial resources or you're in a financial rebuilding phase or

[5:43] something like that where you know you can't spend as I used to joke when I was in business you know A month's income on the various types of insurance that you need Okay so I prepared a little PowerPoint um to to do this because I think it's a little bit easier to see some of these terms um you know as we go through them okay so and and and and this is really it what insurance do you need now as always I'm giving you general

[6:18] information this is not meant to be you know a specific insurance review for you as an individual that's something you need to do with your financial advisor your insurance broker okay whoever it is that you work with to handle your specific situation okay so this is general information that you can use to answer this question what insurance do I need if I were you know asking a question myself okay so um as as always

[6:53] um I just noticed the metaphor I've got here this is a field right it's got to be fertile for planting right so the three pillars of attainment is really that um methodology perhaps we call it for determining how how are we going to use the fertile ground that is each one of us to live the most um uh wonderful life the life that we most want to live okay this is the three pillars of attainment is really a way of

[7:29] thinking about the various questions we ought to be asking in order to figure that out okay so I'm not going to get into it in depth I there's a whole show on my YouTube channel that talks about that I invite you to take a look at it we with insurance of course we're dealing as we always do on and people making money oops and there it goes backwards um we're dealing primarily in the Pursuits pillar and in the finances realm uh however it's going to impact Health it's going to Impact Family and perhaps you

[8:04] know some of the other things plague comes to mind as as you'll see toward the end of today's uh episode okay so let's let's get into now the meat of what we're going to talk about so there are for all intents and purposes two major categories of insurance okay one is Life Health and disability and the other is Property and Casualty now as the names say they're dealing with in a way two different Realms of Our Lives

[8:40] okay so Life Health and disability is dealing with our physical well-being or lack thereof right I mean life insurance presumably is there not presumably life insurance is there right for when we pass away okay but it's still dealing with our physical well-being Property and Casualty Insurance on the other hand is dealing with our property okay and accidents that can happen because of it to it those kinds of issues okay so as we get further into

[9:16] the presentation you'll see how these two categories work out in practice now another reason for identifying these two categories for you is there are insurance brokerages that are comprehensive and they handle all types of insurance in both categories but there are other types of insurance brokerages that only handle one or the other okay so for example you

[9:54] um if you're dealing with a life insurance agent okay typically that person will not deal with Property and Casualty Insurance now their company may have a program you call a number and you'll and you'll talk to a property in Casualty agent but your life insurance agent probably doesn't have much of any background and knowledge in the property in casualty sector okay as well in some states it requires different licenses to

[10:31] sell these two different categories of insurance okay so you may have someone who has a life insurance license trying to think of I believe Virginia is a state like this so someone who has a life insurance license in Virginia that does not permit them to sell Property and Casualty Insurance that's a separate license so you have to have both in order to advise you and sell both types of insurance so that's another distinguishing characteristic between the two and why is there a separate license in some states it's

[11:07] because the issues that are dealt with in the two different categories are significantly different okay so it takes a a separate body of knowledge in order to advise people appropriately in these two categories okay so we're going to start out and we're going to talk about the types of insurance under the Life Health and disability category and then we're going to talk about uh Insurance under Property and Casualty category story and then I'm going to talk about a couple of others that don't really fall into either uh they you know and and

[11:45] they're not the most common well I shouldn't say that it's not that they're not the most common it's a it said they they tend to be I don't know after thoughts maybe that perhaps that's the best way to explain it okay so let's let's get let's get into this now all right so under Life Health and disability I'm going to talk about four types of insurance and there I I would say in in order of their importance okay generally speaking now now again

[12:21] your situation your specific situation may require a different priority of coverages okay so this is not meant to apply to you specifically this is general information okay having said that health insurance in the Life Health and disability category is probably the most important insurance that we should have okay I would say most of us are probably familiar with health insurance whether we have an HMO with something like Kaiser whether we have a PPO

[12:57] through maybe Blue Cross Blue Anthem okay health insurance is there to defray the cost of staying healthy right now there's a huge huge range in types of plans okay there are some plans that only cover so-called major medical like you know surgeries and those kinds of very expensive procedures but otherwise they have very high deductibles and and higher co-pays so for your kind of routine Medical Care

[13:34] most if not all of that is going to be paid out of your own pocket but as a result the cost of the major medical health plan is relatively low okay and then there are health plans that that are that have very broad broad coverage very low deductible low out of pocket okay and they they cover in some cases virtually everything okay so when I was um still in the military I had insurance through what's called Tricare that's the government military

[14:09] um health insurance system and through Tricare I mean it was virtually a hundred percent uh coverage for for everything I don't even think I had co-pays if I recall I think I I think for my family at the time we had a family deductible I want to say of about three hundred dollars maybe something like that okay and then and then a hundred percent of everything else was covered okay so I mean it was as Cadillac as they call it Healthcare as as you could get especially since I didn't live near a a

[14:46] military facility so I didn't have to go on base to get my health care because the nearest base was more than an hour away right so I could basically go to my regular doctors and everything was paid for now the premiums for a um a family at the time were around I think I want to say 300 a month maybe 500 a month still far far far far less expensive than anything that was available in the civilian Insurance Marketplace okay uh so now and it is the case that

[15:22] um government uh provided insurance plans tend to be better um in terms of what they cover and how much they cover Etc than private sector plans Union plans tend to be better than other types of private sector plans Okay so these are all things to keep in mind okay when you're dealing with health insurance right also what categories of health does it cover so does it cover a medical it probably

[15:57] covers does it cover dental does it cover Eye Care what what how does it cover prescription medications right uh how does it cover medical devices all of these things okay go into a health care plan so you know if you're if you're not sure what your plan covers then if you have an employer-sponsored plan right you should be able to talk to your benefits manager and they'll be able to tell you okay if you don't have health care right you can go to Health Care exchanges now and

[16:32] you can get health care through the exchanges in some cases you may qualify for a subsidy in order to get the uh in order to get health care insurance okay um the main thing is for most of us this is probably the the you know if we don't have any other insurance health insurance is probably the one that we want to have for ourselves and our families okay now the next type of insurance is disability insurance so some states for example California

[17:07] have something called SDI state disability insurance okay and and as an employee okay your uh gosh I don't recall now if if your employer or you actually pay the SDI uh tax but in any event that SDI tax is paid and therefore you are entitled to get disability coverage from the state of California now I don't think all 50 states have SDI but probably most

[17:44] of them do okay so the question is how extensive is that disability coverage so if you get hurt and by the way disability can be temporary it can be permanent okay and and Social Security also has a disability program as well that's part of the overall Social Security uh scheme if you will Okay so looking at that disability coverage is that enough to sustain your lifestyle if

[18:23] you had to rely on that in lieu of your income in lieu of your salary okay so that's something that you're going to want to investigate okay these this these State plans are I mean they they provide you know reasonably decent benefits but you know if you live in a high cost location like Los Angeles like New York um Washington DC Chicago okay what you get may not be enough to sustain your lifestyle in which and by the way if you

[19:01] are self-employed so if you're a gig worker for example or you're self-employed in the sense of you know you do you know contract work for this person that person whatever okay you may not be covered under estate disability insurance plan okay so in that case too you may need to look at private disability insurance now the thing about disability insurance is the older you are are the more expensive it is to get this coverage Okay so

[19:36] it's one of those things that you're probably less able to afford it when you're younger and you have a more limited income on the other hand the sooner you can get started with disability and and potentially lock in your premiums the better off you'll be down the road okay so with disability insurance okay this is not the first thing you want to buy the first thing you want to do is is find out am I covered for disability through the government or through my union or through you know

[20:13] some sort of Professional Association do they have a disability insurance plan okay and if and if the answer to that question is yes then how much coverage do you have and how what does it take to become eligible is there a waiting period do you have to be disabled for 90 days before it kicks in something like that okay so check out all those things to see how will the disability insurance work and is it going to allow you to continue living how you're living now with with the

[20:49] income that you have okay and if it does you're in good shape so this is not you you you don't have to buy private disability insurance now if you don't have any kind of disability insurance okay or what you have what you can access through through the state or through your union or whatever isn't enough so then you may want to look at additional private disability insurance coverage okay all right so that's that's disability insurance I want to keep keep an eye on the time here next is

[21:26] long-term care insurance now this is different than disability okay so let's say that God forbid you're injured in a way where you need long-term care maybe in a nursing home maybe in some kind of congregate Care Facility maybe at home care okay so it's not only that you're disabled okay you need ongoing long-term Health Care okay that's different than health

[22:02] insurance care okay and again the older you get the more likely it is that you may need long-term care Okay so um to the best of my knowledge um there's no government program certainly not here in California for long-term care insurance now do you are you covered for long-term care through your employer maybe if you're a union member are you covered through your union maybe okay

[22:37] that's something you need to take a look at okay now I know in the military if someone was injured while on active duty for example and it required ongoing Health Care so they might be transitioned out of the military but they would retain health care services for that injury or or whatever it was that was sustained while they were in the military okay but that's not necessarily true of other government insurance

[23:12] okay so you may need to get long-term care insurance okay now the thing about long-term care insurance that is kind of similar to disability is that the earlier the younger you get it the less expensive it will be so if you're going to try and get long-term care insurance for the first time when you're 65 or 70 the cost is going to be very high most likely on the other hand if you first get long-term care insurance when maybe you're in your 30s it's probably going

[23:48] to be much more affordable okay now that doesn't mean that therefore you can afford it you may not be able to Okay so you also you know examine your overall health examine the health of of members of your family especially older members did they live a long time and do they live pretty healthy lives did they spend lots of time in nursing homes and that kind of thing those are some of the questions that you're going to want to investigate before you decide whether you need to get long-term care insurance

[24:23] okay but but keep in mind one of the scary parts of being sick is running out of money for the health care that you need right so that's why long-term care insurance is there okay just as as an aside I mean I I've had long-term care insurance now for gosh 20 some odd years okay so I first got it when I was in my very late 30s or early 40s I don't recall exactly now um and so my cost is pretty low and in in

[24:59] my case it has a writer on it that each year they'll bump up the amount that I get by an inflation Factor okay it bumps the premium up a little bit but what I'm paying for my long-term care insurance now is uh far less than it would have been if I went to try and get the coverage now okay as someone in his early 60s okay so again something to look into you may not need to get it right away okay but you

[25:34] may want to educate yourself about it so that you can make a you know an informed decision is this something I really need to take a serious look at or you know is this something I really I really don't need okay it's a it's it's a bigger financial burden perhaps now than it I really want to Bear given my other priorities okay now by the way if you have huge assets okay and you're you know you're not concerned about running out of money then you may not need long-term care insurance

[26:10] I mean you may not by the way you may not need disability insurance either okay if you've got tons of assets so then then it may come down to if you can support yourself without working do you really need to pay insurance premiums for these other types of coverages okay that are there in essence because you can't work and or need ongoing somewhat costly or very costly Health Care okay so you can what we might call self-insure in the sense that you've got big assets and so you don't need to necessarily pay for an insurance policy

[26:47] in in in these areas okay all right last of the in the category of Life Health and disability is life insurance okay now um I did a show on life insurance I think it was a I want to say if quite quite quite a few weeks ago okay and I talked about the different types of life insurance why you should have it et cetera et cetera so I'm not going to go in as much detail today as I did in

[27:26] in that uh particular episode because you can always go and and watch that if you want to get into more of the uh uh oh no you know what I take that back it was not a show I wrote a newsletter about life insurance that's what it was okay so life insurance comes in basically two well let me first of all let's talk about what life insurance is for life insurance is there to make sure that if you die your family or whoever your

[28:02] beneficiaries are and continue their lives financially in your absence okay so let's say um you know you're you're a man you have a wife and two children okay and you provide I don't know two-thirds of the family income okay if you die how is your family going to continue to live with your loss of income well you may say well I'm not going to be there so they're not it's not going to cost them

[28:37] as much well that's true okay but they're they're housing cost probably isn't going to decline just because you've passed away unless they you know get smaller housing or something okay yes less food but many of the expenses of supporting a family are are fixed in the sense of whether there's four members of the family or three doesn't make a a big difference so for a family to lose two-thirds of its income would make it very difficult for that family to survive so life insurance is there in

[29:13] essence to compensate for the loss of that income okay now there's a couple of ways to look at it one is to provide some temporary funding while the family sort of re-juggles itself to be able to live with you not there any longer okay and another is to provide what amounts to a permanent replacement for your income okay so let's say that you're you are

[29:50] making a hundred thousand dollars a year okay if you were gonna do kind of a stop Gap measure so you so you might consider getting say two hundred thousand dollars of life insurance and that will allow your family to go for two years without your salary and get themselves kind of reorganized so that they can live going forward without your salary okay another way you could look at it is to say well let's see I was making a hundred thousand dollars a year if I get

[30:27] a million and a half dollar policy okay and then that policy when it pays off is turned into what amounts to an annuity at about say six percent so that's gonna throw off an income of about ninety thousand dollars a year in in perpetuity as long as the million and a half dollars is there okay and so you've replaced your income essentially permanently okay as long as the as long as the million and a half in in in capital from the insurance policy

[31:02] paying off stays intact okay so in the first case your the um the benefit of the policy is going to be spent in the second case the benefit from the policy is going to be invested and only the interest thrown off from it or the return thrown off at from it is going to be spent but the principal is going to be kept intact those are basically two of the those are two of the basic ways that life insurance can be used in order to help your beneficiaries stay financially stable

[31:39] after you have as Shakespeare says shuffled off this Mortal coil okay so there are two basically two categories of life insurance there's term life insurance and then there's all the others which are basically life insurance with some kind of investment plan built in okay term insurance is just that you're buying it it's it's very much like um you know Auto automobile insurance okay

[32:15] in the sense that you pay a monthly or a quarterly or an annual premium and as long as the premium is paid the coverage is in Force if you stop paying the premiums basically the the policy will get canceled at some point and the coverage goes away okay you don't build any equity in a term life policy it's there purely for financial protection okay and most I I would argue most prudent

[32:52] financial advisors would say that that that's what life insurance is for okay life insurance when they talk about they really mean term life insurance the ability to replace lost income now on the other type of life insurance policies whether they call it variable life insurance universal life insurance uh variable universal life insurance I mean there's all kinds of names whole life is an another type of of of the in the other category of insurance all of these essentially share

[33:29] a couple of characteristics one is they have embedded in them what amounts to a term life policy and in addition part of the premium you pay is put into an investment account now it may be the master investment account of the insurance company or it may be an individual investment account that you start it depends on the type of policy okay and as a result the life insurance policy can build up Equity meaning it can a value to that

[34:06] policy can be built up when the policy matures you'll get that equity you can also borrow against it but you're going to pay interest if you borrow against the equity in your policy okay and you can in some cases sell the policy and get your Equity out as well so the question comes down to and and this is kind of a an argument in finance the financial services business there are certain companies that will say never if you're gonna buy life insurance term life insurance is the only kind to

[34:43] buy so buy term and whatever additional premium you might have paid for some other more elaborate type of life insurance just invest that directly in an investment account okay other people say no no no no no no that that's a breach of fiduciary duty to say that because some people you know whole life or universal life may be the right choice for them okay I'm not going to get into that argument today um because it's it's it's really it

[35:19] really comes down to perspective what does someone see life insurance or I shouldn't say perspective I mean philosophy what does someone see the purpose of life insurance being is it to replace income as I've been talking about or is it to replace income but also build itself up as an asset and if so is that the best way to do it okay so if you're talking to a life

[35:54] insurance agent these are the kind of questions you're going to want to ask okay um and and I would encourage especially if they're talking to you about something other than term insurance I would encourage you to ask okay how much of the premium I'm paying is actually going to pay for the insurance and how much is going to be invested and if I were to get a separate Term Policy would the pop would the the insurance premium be higher or lower than the premium part of the more

[36:31] complex insurance policy do you see what I'm saying okay those are the kind of questions to ask the additional amount of money in the complex more complex life insurance what kind of return will I get how much access will I have to that money could I put it in a mutual fund instead and would I end up better off doing that okay these are the kinds of questions that need to be answered if you're going to consider some kind of life insurance policy other than term life okay so

[37:08] these are the four most common type of um life insurance policies now by the way with life insurance too as I mentioned with disability and long-term care if you have a substantial net worth okay you may not need life insurance okay if you are if you're already worth a million dollars two million dollars four million dollars something like that you may not need life insurance what is it that you're trying to replace okay if you if you if you've got a couple million dollars in assets already

[37:46] you could probably replace your income okay with just the assets that you have on hand okay without defraying the assets okay so in that case paying for life insurance may not make any sense you're better off investing that money um and and continuing to build your wealth rather than using it to ensure your life in in the event that you know you're you die and now your family you know has to replace your income well if you've got significant wealth so then may not be an issue okay so that's

[38:23] another that's another thing to discuss with an agent is do I even really need life insurance okay so please keep that in mind as you consider your specific situation all right so these are the four most common types of uh life health and disability insurance let's move on to the second category now okay Property and Casualty now you're gonna oh just just like with the previous category probably you're familiar with automobile insurance okay if you drive

[39:00] you're required to have automobile insurance okay certainly that's the case here in California I believe it's the case in all 50 states okay now automobile insurance is is a type of Property and Casualty Insurance in that it's there so that if you get in an automobile accident a casualty there will be money there to pay for the damage whether it's damage to property or whether it's damage to people okay now um there there are several

[39:37] um parts potentially to an automobile insurance policy so first of all there'll be liability okay liability is if you hit someone and you're liable for damages to them it'll pay for the the damages there's um comprehensive if you um if you get in an accident and it's your fault how are you going to pay to have your car fixed well comprehensive coverage covers getting your car repaired okay whereas if you get hit they're gonna they're the person who hit you their

[40:12] insurance should pay for your car to be repaired but if you hit someone it's and it's and the accident is determined to be your fault okay your liability coverage is not going to pay for your car to get fixed I'm sorry not comprehensive Collision Collision will repair your car okay um and then you have comprehensive coverage and now I'm going up on what comprehensive is ah okay but there's comprehensive coverage there there may be Towing there may be medical coverage okay that the medical coverage applies specifically if you get into an

[40:47] automobile accident so you don't have to necessarily access your health insurance for that okay so there can be several types of coverages within an auto insurance policy all right and part of the policy too deals with what are your coverage limits so the the higher your net worth the higher your limits may need to be okay now if you have no assets you're what's you know sort of tongue-in-cheek and legal circles called um judgment proof because somebody can

[41:23] sue you and they can win but you have no assets so they're not going to get anything from you okay and so if you have a big huge limits on your insurance policy all that's happened is you're paying a lot of premiums so that if you get into an accident the person gets a bigger chunk of money okay but you know you're not if you're not protecting any assets you may not need real High coverage limits okay so that's something to look at when you're dealing with automobile insurance you may also want to get uh uninsured or

[41:59] underinsured motorist coverage now that's very useful if you get in an accident it's the other person's fault but they don't have insurance or they don't have enough Insurance to take care of how you've been damaged so then your policy will kick in and cover the dis the difference okay so if you live in an area where there's a lot of uninsured motorists okay for sure you want to consider getting uninsured motorist coverage in your auto insurance policy okay I'm not going to go into

[42:36] anything more than that um presumably most of you are familiar with automobile coverage okay so we're just going to leave it at that okay next homeowners or renters insurance okay and they're they're just what they describe if you own a home you need to have homeowners insurance if you rent the place you live you can't get homeowners insurance because you don't own it but renters insurance can be extremely important for a number of reasons okay

[43:12] number one if you get burglarized okay it's unlikely the owner of your building is going to be liable for you being burglarized you need to cover your own possessions that's that's one of the things renders insurance will do it'll cover your possessions okay renters insurance typically also has a liability provision so if you have some guests over and they trip and fall in your apartment okay or maybe you're

[43:47] renting a house they trip and fall in your house okay your renter's insurance will cover you for that liability and and depending on how the coverage is written it may also by the way pay for insurance uh pay for not I'm sure pay for the cost of a lawyer defending you okay which can get pretty cost okay and in many cases by the way it's the cost of the defense that's so expensive and so that even if you win you could still be out you know a hundred thousand two hundred thousand dollars or more right so renters insurance can cover you for

[44:23] that as well some renters insurance has a limited amount of um uh um I'm going up on what it is but if you have someone come in and do work on your let's say you have someone come in and mount some bookshelves workers compensation that's what I'm looking for it may have a limited amount of Workers Compensation Insurance so that if you have someone coming in and doing a repair or something in your apartment or you have someone coming in to clean your apartment okay they may be covered uh if

[44:59] they get hurt while they're working for you okay now homeowners insurance it's just what it says is if you own a home own your residence okay it could be a two unit it could be a condo could be a three unit building okay not only does it cover all the things that I just mentioned under renters insurance but typically it's also going to cover damage to the building itself okay depending on how that damage happened okay so if there's a fire typically a fire would be covered okay

[45:36] if there's a flood typically a flood wouldn't be covered flood insurance typically is is is an exception um in a homeowner's policy that requires separate coverage a separate flood or flood flood insurance policy okay so when you're dealing with both homeowners and renters insurance you need to look at the coverage carefully what does it cover what does it not cover okay let's say you have a broken pipe okay and and it and it sprays water all over the place and the water maybe the

[46:12] water damages you have hardwood floors and now the floors buckle and you got a whole mess okay so you call the plumber the plumber comes in they shut off your water they have to replace a length of pipe and you know three thousand dollars later at least the plumbing is fixed but now you've got damage to the property the floor of the walls or whatever okay some homeowners policies will cover the damage to the floors in the wall but they're not going to cover the source of the damage the pipes themselves others

[46:47] cover both okay it depends on how the policy is written okay so these are the kinds of questions that you need to ask when you're securing these types of coverages okay so um um like you I'm sure you've seen the the um uh commercials for like all state State Farm Farmers okay historically these companies were Property and Casualty companies I'm I think all of them now have life insurance uh

[47:23] divisions as well okay but historically like they covered Auto they covered homes some of them had renters insurance okay um just because they're a well-known carrier does it mean that they're they necessarily are offering you comprehensive coverage okay so you need to look at the details to make sure you understand what all is being covered in a homeowners or renter's policy okay um having said that you know I mean if

[47:59] you're going to be driving you need to have an automobile insurance policy you can lose your license if you don't have one um but after that you know I mean if you have a home well if you have a home and there's a loan on the home your lender is going to require you to have a homeowner's insurance policy now if you rent your landlord may require you to have a renter's insurance policy some do some don't okay if you're not required to have one you may not have one and and if you're you know living on a tight budget you just may not be able to afford it okay on the other hand

[48:35] you know if you don't have a lot of possessions so then it may not be that expensive it depends on the jurisdiction you're living the the zip code you live in ETC okay so you know do you absolutely have to have renters insurance it really depends on your specific circumstances okay now but before I leave the topic of homeowners and renters insurance there are certain types of property that you may have on your premises that are excluded from a typical homeowner's policy or there's limits on how much will be covered for

[49:11] example jewelry so if you have a lot of valuable jewelry on your pro you know in your home okay your policy may only cover it up to five thousand dollars or something like that and so you may need to get what's called a writer which is an additional coverage specifically for the jewelry that you have or you may need to you know keep it locked up somewhere where it can't be stolen okay the same is true of musical instruments Firearms um uh technology computers and that kind

[49:50] of stuff okay many of these types of properties a typical homeowners or renters policy will have a limit or an exclusion or we'll exclude them from coverage all together and so if you have any of these items that are particularly valuable you may need to get either a separate policy for them or you may need to get a rider on your homeowners or renters policy in order to make sure that they're covered Okay so some of you may be familiar with USAA USAA has limits on like a musical instruments okay so

[50:27] um um I I when I was stationed in Okinawa um I had a a musical instrument my father had given me and I never really thought anything about it um and then I um I needed to have some repairs done on it and so I I actually shipped it back to the United States to have the repairs done and when the fella who's doing their pairs got it he said he sent me an email he said do you have any idea what this thing is worth I'm like no and he said yeah it's worth at least X I'm like wow he said and the next thing he said was you may want to check

[51:02] your insurance because you're probably not covered and indeed I wasn't but I could go on to the USAA website and for a small additional premium I could add a rider onto my renter's policy to make sure it was covered okay um and when I say small I think it was I don't know 10 20 bucks right because How likely was it that this you know musical instrument was going to be stolen okay but still if it had been stolen I would have been heartbroken right so sometimes you need to deal with um certain types of property um not not necessarily separately per se

[51:38] but in addition to your homeowners and renters policy let's see how we're doing on time here okay all right let's move on so identity theft um I don't even remember the statistics on identity theft it's like tens of millions of people I think have their identity stolen every year okay I've had mine stolen it was an enormous headache it took me two years to get everything fixed from it okay so there are identity identity theft policies out there okay um there are things like LifeLock which

[52:13] that's not really Insurance um but it can help you prevent your identity being stolen okay if if this is a concern you know it I I you know may not be the number one top priority but if you can afford it um you may want to look into identity theft Insurance okay now there are all kinds of of laws rules regulations about how much you can be held liable for if you know money is if your identity is stolen and and people use your credit cards without your authorization all

[52:48] that kind of stuff there's only so much you can be held liable for all of that needs to be checked out um within I mean there are certain laws that are National but there are certain state laws as well so you need to look within you know where you're living to find out you know do I really need identity theft coverage okay finally I'm going to talk about something called an umbrella policy now if you have substantial assets to protect let's say you're worth a couple of million dollars okay and let's say you know you've got an

[53:24] automobile insurance policy and you've got pretty hefty limits on it maybe you have something like uh you know 125 250 50 000 or something like that okay so you get into an automobile accident you're covered up to 250 000 okay but you've got assets worth two million bucks okay if the person if the accident is your fault and the person who hits you finds out you have substantial assets guess what they're going to sue you to try and get some of those assets okay so you may need to get what's called an umbrella policy which covers

[54:01] you for liability on a whole range of potential issues it could be an automobile accident it could be someone slipping and falling in your house um all kinds of different potential casualties could be covered by that umbrella okay and it typically will cover you no matter where you're located okay so maybe you're you know you live here in you know Los Angeles where I do but you're on vacation in Texas and you get into an automobile accident there the umbrella typically will cover you for any liability you have there as well

[54:38] okay now an umbrella policy like if if you don't have a lot of assets it's unlikely you're going to need an umbrella policy okay but if you have substantial assets that's really something that you're going to want to take a look at and see if it makes Financial sense okay all right so I'm not going to get into them any much more than that but just I want you to be familiar with that concept because we're also yeah we've got about five minutes here okay so those are the four most common types of of Property and Casualty Insurance for

[55:13] an individual in a family all right now a couple of others I mentioned that I I said I would talk about toward the end and that is pet insurance and travel insurance so um Veterinary Care can be very expensive these days okay I know when when when my dog jiggers was still alive he had to have operations two or three times to remove kidney stones okay and and each one costs anywhere from about eight hundred to fifteen hundred dollars okay now I I didn't have pet insurance back then

[55:49] um if I were to get a if I were to get another pet I think I would probably consider getting pet insurance okay because like I said pet Healthcare can be very expensive okay and and the reality is we love our pets and if we are going to have to do some kind of expensive medical procedure Insurance may make sense in the same way that we have health insurance you know for ourselves okay um I'm I candidly am not um familiar with terms in Petco Pet Health Care insurance policies I have

[56:26] seen a couple of them over the years um but it is something I just want to kind of put the bug in your ear if you do have a pet I mean I've heard of things by the way insurance policies for pets to get mental health care I have to say I do think that's a little nuts but I've I've heard of them I don't know that I've ever seen one of those policies maybe it's an urban legend okay but um um I guess if you're gonna send your uh you know your your cat to a shrink which which you know I can't imagine you know giving mental health care to a cat

[57:01] but but whatever um but in any event if you have a pet especially a beloved pet then that may be something you want to consider travel insurance it's it's been around for a long long time you see the the travel insurance uh dispensers I think still at airports and it's it's it's exactly what it says um uh well well there's a couple types of travel insurance one is like travel casually insurance which you could also like if you're gonna take a trip but you're concerned that for some reason you may be may not be able to go on the

[57:36] trip and you're gonna lose your money so then you can get travel insurance that will pay you back summer all of the cost of the trip if you have to cancel um a a ticket that's non-refundable okay um I you know I think sites like Priceline and such offer it when you you buy a ticket I've been traveled in a long time so but my recollection is you know they'll offer it um and again you know it's it really comes down to your particular situation are you you you know absolutely certain you're going to go on this trip is there

[58:11] a chance you may get canceled has your health not been great and so there may be some kind of Health thing that'll come up that prevents you from taking it well maybe then it's worthwhile to spend the money for the travel insurance okay but it's just again something to keep in mind um you know if especially if you do a lot of traveling so then you probably want to be familiar with it so you know whether it's something that you you you uh you know want to deal with each time all right so that is that's 10 different types of insurance okay if you have any questions

[58:47] you can contact me at our various social media Outlets as well as you see um my my email address there I'm happy to answer any questions that you have um including if if you um you know um need a financial advisor be happy to introduce you to somebody who can help you um and if you have questions comments good bad whatever feel free to post them if if something you're asking um isn't personal and may have kind of broad applicability to you know to a lot

[59:24] of people that's somewhat redundant um please you know post it so that other people can see the question in my response to it um because that'll that'll help them out as well um and we'll all you know learn even more together okay so that's that that's and these all of these will be um in the show notes as well oops and I'm not sure what happened here okay there you go here's all the legal stuff and that ends it and let's go ahead and stop the sharing so that is my show for today your uh Insurance primer if you will what insurance coverage do you

[59:59] really need you know I wanna I want to reiterate this before we end and that is um while I went through 10 different types of insurance coverage I do not mean to imply by any means that you need all 10. okay you may only need a couple out of that list and or you may only be able to afford a couple you may not be able to afford any of them right now that's that's understandable those are look when I was first out of college you know I didn't have health insurance couldn't afford it and I didn't work for an employer Who

[60:36] provided health insurance I just didn't so if I got sick I took care of myself you know as best I could and eventually I you know I got to the point where I could afford health insurance and then when I started my company more formally I had you know I had health insurance I had disability insurance I had long-term care insurance I had life insurance um and then I had all of the business insurances which we didn't even talk about today so over time as you as you your finances improve so it may be prudent for you to consider and or get

[61:13] more types of insurance than you had before okay on the flip side as you get more affluent certain types of insurance that maybe you carried before you don't need anymore like life insurance Okay so you do want to be reviewing this subject periodically I would say at least once a year um you know or once every two years at the lease you know at the least frequent okay so you know your circumstances change and you know it's like if if you're single but then you get married you want to you know look over your you

[61:48] want to do an insurance review if you have a child you want to do an insurance review okay um if there's a substantial change in your wealth you probably want to do an insurance review and and I I want to reiterate that doesn't mean you necessarily need more Insurance it may mean that you don't need a particular type of insurance anymore and it would be better to take that money and invest it rather than spend it on insurance premiums okay it all depends on your individual circumstances so there you

[62:24] have it again if you have any questions comments please feel free to let me know and that that's that's our third and final show of the way to wow shows for this week so we will start again next week on Monday at 10 A.M with trusts and Estates weekly Tuesday at 11 A.M with business uh lessons from the military and then a week from today on Wednesday at 12 30 p.m these were all pacific times by the way will be the next edition of people making money so I

[62:59] thank you very much for joining me thank you for watching and One Last Thing Before I Let You Go if you are not already a subscriber to our YouTube Channel please do consider subscribing that way you will never miss an episode you'll always know when new ones come out thanks again wishing you a wonderful rest of the week and signing off Marie darling you are my inspiration You Are My Bell all the best folks