Introduction

Every financial decision involves risk. While risk is unavoidable, it can be managed. Insurance plays a key role in balancing risk and protecting your net worth from unexpected losses.

Understanding Financial Risk

Financial risk includes:

• Medical emergencies
• Accidents
• Property damage
• Loss of income

Without insurance, these risks can reduce net worth quickly.

What Happens Without Insurance

When risks are not insured:

• Savings are used for emergencies
• Investments are sold early
• Debt increases

This creates long-term financial stress.

How Insurance Manages Risk

Insurance works by spreading risk over time.

It helps by:

• Limiting financial losses
• Providing predictable costs
• Offering peace of mind

Combining Insurance With Wealth Planning

Insurance works best when combined with:

• Savings
• Investments
• Emergency funds

Together, they create a strong financial system.

Conclusion

Insurance is not about fear. It is about smart risk management. By reducing risk, insurance helps protect and grow your net worth.