MANAGEMENT Of RISK WITH INSURANCE:
Risk plays a very important role in our lives.. Even God cannot reduce the risk because risk is important for growth in any segment of life .. Nobody can grow without taking Risk..
But it is advisable to reduce the risk and safeguard ourselves and our business/Family ..
Its very important to understand RISK and it’s significance in our lives…
Most of the common risks are:
1.Risk to Life
2.Business Risk
3.Reinvestment Risk
4.Interest Rate Risk
Most people understand this existing risks but they behave differently when it comes to Risk Management.
There are 4 types of behaviours in dealing with Risk:
A] This 1st kind of person tries avoiding Risk by ignoring it…
B] This 2nd kind of person accepts Risk but doesn’t manage it. He will have a careless attitude towards it and always try to live with it..
C] This 3rd person will try to cleverly reduce the RISK by taking certain precautions in life but not reduce it completely.
D] This person who is intelligent will always take a wise decision of Transferring Risk to a financial instrument which will take over his RISK..and this is INSURANCE..
All the above mentioned risks can be mitigated with different types of Insurance plans:
1.A businessman can transfer his Business risk with Business Continuity Plan .. Future of his business in his absence is safeguarded by this planning.
2.An individual can take life insurance to transfer his Risk…This provides protection to family In his absence.
3.A Young person can transfer his Interest rate risk with Guaranteed returns income plans..
Today deferred annuities can reduce this risk in a retired person’s life..
To Enjoy Life it’s Important to take Risk but always Transfer your RISK Wisely and Timely with adequate LIFE Insurance..
Mangesh Hari Nayak
Founder & C.E.O.