Even rich people have insurance

Many people said to me, "rich people don't need insurance, since they have so much cash already in the bank. Even if something bad happened, they can pay whatever medical bills and even if they can't work anymore, they can continue to live without worrying about money". I can say yes, that is partly true. Rich people don't need insurance, but I can tell you that insurance can give so much benefit to them.

First, they are rich because they know how to properly plan and budget their money and business. They know how to protect and grow their money. Who said that rich people do not want their medical bills to be paid by the insurance company, who said that rich people do not want huge insurance pay out if they are disabled or critically ill, who said that rich people do not want to leave a huge legacy to their loved ones if they passed away? The answer is most of them want.

Second, it is simply about leveraging their money. Rich people know how to use their money to the fullest potential. Insurance is one way they diversify their financial portfolio. Insurance can do what his stocks, bonds, mutual funds, unit trust, precious metals and businesses cannot do. With so little premium, they can create a huge estate.

Third, in some country there are inheritance/estate tax. So when rich people passed away, the tax that need to be paid to the government from his final estate can be very huge. Only the balance of the estate will be given to the family. Life insurance will help to pay this cost and the family can get the full amount of the inheritance.

Let's have a look at this news article from Singapore Straits Times. A Singaporean has more than $20 million insurance coverage.


He said that he do not want his family to be saddled with any debt whatsoever if something happens to him. In a different page he also said that he will want his family to maintain their current lifestyle even when he is no longer around. This shows that he has planned well for him self and his family.

If rich people have insurance, don't you think people who earn less and have less savings in the bank should have too? If you want to be rich, follow what the rich do, as long as you don't break the law.

Just 1 more example of rich people who have insurance.


Yup, that's Mariah with $1 billion insurance. Taken from http://www.independent.co.uk/news/people/news/1billion-legs--celebrity-insurance-policies-1958121.html?action=Gallery

Cheers! Have a great day.