What is insurance and why do I need it?

Insurance by definition is a contract in which the insurer agrees to compensate the insured for specific losses and specific perils. In some cases insurance is mandatory – such as when you want to get a mortgage or drive a car. Otherwise, it’s a wise choice for four main reasons:

1) Peace of mind. With the right type and amount of insurance, you can be protected from the risks inevitable in everyday life.

2) Makes it easier to obtain credit. Lenders may be more willing to extend your credit if they know that proper insurance is in place.

3) Helps to prevent loss. Brokers and insurers work to help prevent loss with information and advice on road safety, anti-theft, fire prevention and fraud reduction.

4) Frees up capital. Because insurance protects your assets, you do not have to put money aside in case of future losses.