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Follow on Google News | David Goran answers when to self insureWhen you choose to bear the financial burden of an adverse event, you are engaging in self-insurance.You may self-insure by assuming the entirety of a financial risk, or a portion of it.
By: FMG When you choose to bear the financial burden of an adverse event, you are engaging in self-insurance.¹ You may self-insure by assuming the entirety of a financial risk, or a portion of it. For example, the deductibles you have on your insurance policies are an expression of the portion of financial risk you are willing to assume. If you want to self-insure, you should consider two action steps. The first is to attempt to manage risks, such as installing a home alarm or not texting and driving. The second step is to create a cash reserve to have available for expenses that are associated with any losses you may suffer. If you choose to self-insure, here are some tips that might help you manage the costs:
The reserve fund you may create to pay for potential financial losses should be kept in highly liquid assets, such as money market mutual funds.³ Money market mutual funds are sold by prospectus. Please consider the charges, risks, expenses, and investment objectives carefully before investing. A prospectus containing this and other information about the investment company can be obtained from your financial professional. Read it carefully before you invest or send money. Ultimately, the decision to self-insure— https://www.pipelineinsurance.com/ End
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