Explain the roles of insurance in financial planning.
DefinitionExplanation should include the following insurance roles:
- Protection against the risk of financial loss due to disability, unemployment, long-term care, death, or other occurrences
- Provision for retirement income
- Accumulation of savings (e.g., for family expenses)
- Provision of cash value that can be borrowed
Other Related Standards
Economics and Personal Finance Standards of Learning
The student will demonstrate knowledge of the role of insurance in risk management by
- evaluating insurance as a risk management strategy;
- distinguishing among the types, costs, and benefits of insurance coverage, including automobile, life, property, health, and professional liability; and
- explaining the roles of insurance in financial planning.