Mika
VIP Contributor
There are different kinds of insurance plans that you can buy for financial coverage for different kinds of situations. For example, health insurance will provide financial coverage when you have to spend money on medical bills. Auto insurance will provide coverage if you encounter accidents.
Is insurance saving or investment?
Insurance does not look like savings because if nothing happens to your house or car, you cannot claim insurance and the premium you paid will be lost. However, also does not look like an investment as there is no guaranteed return if you are not in a position to make claims.
Interestingly, if you buy term life insurance, it can be some sort of savings. That’s because even when don’t make claims, you will still receive your insurance amount after the period ends. Term life can also be called investment because the return is guaranteed either in terms of financial coverage or by claiming insurance amount.
Is insurance saving or investment?
Insurance does not look like savings because if nothing happens to your house or car, you cannot claim insurance and the premium you paid will be lost. However, also does not look like an investment as there is no guaranteed return if you are not in a position to make claims.
Interestingly, if you buy term life insurance, it can be some sort of savings. That’s because even when don’t make claims, you will still receive your insurance amount after the period ends. Term life can also be called investment because the return is guaranteed either in terms of financial coverage or by claiming insurance amount.