Introduction

Building net worth is not only about earning and saving money. It is also about protecting what you already have. Understanding basic insurance concepts helps prevent financial shocks that can slow or stop your progress.

Why Insurance Basics Are Important

Without basic insurance knowledge, people often:

• Buy the wrong coverage
• Pay more than needed
• Face unexpected expenses

Insurance basics help you make smarter financial decisions.

Essential Types of Insurance

Health Insurance

Protects you from high medical costs and keeps savings safe.

Life Insurance

Provides financial support to your family and protects long-term goals.

Property Insurance

Covers homes, vehicles, and valuable belongings.

Key Insurance Terms You Should Know

• Premium: The amount you pay for insurance
• Coverage: What the policy protects
• Deductible: The amount you pay before insurance applies

Understanding these terms prevents confusion and mistakes.

How Insurance Supports Net Worth Growth

Good insurance:

• Prevents debt
• Protects investments
• Keeps emergency funds intact

Conclusion

Learning insurance basics is essential for building net worth. When protection and planning work together, financial growth becomes more stable and secure.