Question

Winston is married, has four children, owns his home, and has a roofing business. One of Winston’s children has a hereditary heart condition that requires monthly hospitalization for monitoring. (20 points) In addition to car insurance, what are other types of insurance coverage Winston would be wise to purchase? Explain WHY he needs each type of coverage .

Answer 1

1. Life Insurance

Assuming that Winston being the sole bread winner of the family, he must get his life insured for a suitable cover based on his age and annual income and his affordability. A life is taken mostly for protection purpose so when some uncertainty happens to the bread winner of the family, the family shall not suffer to meet their livelihood. Upon uncertainty of the life of bread winner the family shall receive a lump sum claim from the insurance company. Here winston atleast needs to take a basic protection cover such as a Term Plan.

Health insurance.

It is advisable to get the whole family covered by health insurance at an early age so that the risk of disease is reasonably low which in turn shall reflect in lower premiums. Health insurance is mainly taken up to get claim during hospitalization treatment or surgery. It is know that one child has a hereditary heart problem whether the cover is given or not for such a child is something based on various parameters. It is since one child is affected by a hereditary problem there is an equal chance that the other 3 children may develop such a condition in future. Therefore it advisable that Mr.winston get himself, his wife and 3 children get covered by a health insurance.

General insurance.

A general insurance is taken up to get claim for the losses incurred through car, business, house etc. It is given the Mr. Winston has already has a Car insurance. A general insurance for his house and business shall also be taken up because the same shall help him indemnify his losses if occured due to uncertain circumstances.

The whole concept of revovles around taking precautionary steps to make good any kind of loss.