WHAT INSURANCE PROTECTS. The purpose of insurance is to protect against the loss of something of value Designed to restore you to your financial position to where it was before the loss NOT to allow you to profit from the loss!. Insurable Interest.
Before you can insure your property, its value must be measured in financial terms.
The insurance company can then compensate you based on its value.
Your life and health don’t carry a price tag like property does.
Health and Life insurance are sold in different amounts.
The greater the amount of coverage you choose, the higher the premiums.
Your goal in buying insurance should be to protect yourself from a loss that could put you in financial difficulty. It should not be to protect from any loss. The more insurance coverage you buy, the higher the premiums. At some point, the premiums themselves could put you in financial difficulty.
**You should only buy enough insurance to cover the losses you would have trouble paying for yourself.**