Your 20s are the most exciting years of adulthood. You are young, full of energy and have probably just started your career. The world is your oyster, and the endless opportunities available to you are more than enough to fuel your ambitions.

But your 20s are also the time to set the foundation for your financial future. Many of the financial decisions made in your 20s have a lifelong impact. One of the best financial decisions you can make is applying for insurance.

Why do I need insurance?

Insurance is all about managing risks. When you have insurance, the cost of a potential loss is transferred from you to the insurance company in exchange for a fee called a premium. Premiums are collected and invested to pay for their client's losses.

How are Insurance premiums calculated?

Insurance companies calculate your probability of being involved in an accident or the likelihood of the vehicle being stolen. The insurer can then take into account certain risk factors such as where your car is usually parked, your driving experience and the security measures put in place to protect your car. Once that is done, a premium is assigned.

Car insurance providers (or any type of insurer, for that matter) calculate their premiums using unique risk calculations. Therefore, you may not be offered the same premium at all insurers, which is why it's important to shop for the best insurer. When you're browsing the internet for car insurance quotes, make sure you don't settle for the first deal you see. Just remember to balance price and protection โ€” a cheaper premium can mean less comprehensive cover. That said, being offered the cheapest car insurance premium might have more to do with your good risk profile than inadequate coverage. Read through your policy carefully before signing on the dotted line.

What are the benefits of being insured?

The most obvious benefit of being insured is being indemnified for loss or damage. But there are other benefits. These include:

โ— Managing financial uncertainty: Insurers cover the costs of unexpected damage, which drastically reduces the uncertainty of paying for emergencies out-of-pocket.

โ— Promoting risk management: Most policies have incentives and rewards programmes that encourage risk control activities such as sticking to the speed limit or discounts on your premium if you donโ€™t need to drive to work.

โ— 24-Hour Emergency Assistance: Depending on whether you have comprehensive home or car insurance, you may have access to your insurerโ€™s 24-hour emergency call centre, who will be able to assist you when youโ€™re locked out of your car, in an accident or your geyser bursts.

What should I consider before getting Insurance?

Your needs define the type of coverage best suited for you. For instance, let's say you work from home. That means you don't leave the house as often as most people. If you're looking for car insurance, you need to choose a policy that will give you reduced premiums based on your working situation. MiWayโ€™s MiWheels at Home cover allows you to save up to 20% on premiums if you work from home.

Insurance is not a luxury โ€” it is a necessity that allows you to go about your day with the complete assurance that you'll be covered in the event of an accident. Simply put, it gives you the peace of mind you need to live your way.

MiWay is a licensed insurer & FSP 33970. Ts & Cs apply.

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