Insurance & Protection
3 guides and tools on insurance & protection.
Which risks are worth insuring, which are not, and how to avoid paying for cover you will never be able to claim on.
Which Insurance Is Worth Buying
Insure what you cannot afford to lose. Everything else is a transfer of money to an insurer in exchange for peace of mind you may not n…
Insurance & ProtectionFinancial Emergency Planning: What to Sort Out Before You Need It
Financial resilience is mostly a small number of boring tasks, each of which takes an afternoon and none of which feels urgent until it…
Insurance & ProtectionFinancial Scams: How They Work and How to Refuse Them
You cannot recognise every scam. You can adopt a process that defeats most of them without needing to.…
About this section
Insurance is a transfer of risk, and insurers charge more than the expected cost of the risk because that margin is their business. On average, buying insurance loses money. It is worth doing anyway when the loss would be catastrophic rather than merely annoying.
That single test sorts most of it. A phone screen is an annoyance your emergency fund can absorb. Losing your income for two years is not. This is why extended warranties, gadget cover and similar products are consistently poor value — they insure amounts you could absorb, at a high margin, often duplicating rights you already hold under consumer law — and why income protection is the most commonly neglected cover of all. The probability of being unable to work for six months at some point in a career is considerably higher than the probability of dying during it.
The other recurring theme here is preparation rather than product. A will and a power of attorney solve two different problems, and most people need both. Someone should know what accounts exist and where the documents are. Knowing what employer sick pay and state support you would actually receive changes how much cover you need to buy.
These guides also cover financial fraud — the categories, the psychology each exploits, and a process that defeats most of them without requiring you to recognise every trick.