No one can predict when a disaster will strike. A single disaster causes significant financial strain on a family. Depending on the amount of savings and the amount of money needed to recover, this can lead to bankruptcy. Insurance is meant to provide financial protection in time of crisis. If a person is insured, these serious events will not cause as much burden and should not send them into a downward financial spiral. Many people will say that insurance cost too much, but do not look at this as losing money, look at it as a savings account, an investment in the security of your future.
On May 8, 2009, a super derecho hit southern Illinois. My grandparents had a lot of damage to their home and the surrounding land. They spent several days without power as did many people in the affected area. My grandparents live in a rural area and there are limited resources. Many people in the area did not have insurance. This was devastating to the community.
The families that had insurance had faster repairs and they also had other resources available to them, such as hotels being paid for them in neighboring towns while their homes were being repaired. Others, who did not have insurance were left in their storm ravaged homes without power. Without electricity there is no way to store or cook food. This left little food available to these people. Many people were forced to cook over campfires.
Those without insurance did not have shelter. Some had no roofs on their houses, or like my grandparents, had trees that landed across their homes. This occurred in spring and several other storms blew through the area during this time. Several family had to live in tents as their home were uninhabitable. Some used tarps to keep the rain from causing more destruction to their homes and possessions. The town looked more like a third world country than rural America.
In addition to being forced to “camp out” and heat their food over a fire, those that did not have insurance had limited access to supplies to repair their homes. Insurance companies had resources and contracts with other companies to get repairs completed more quickly. Without the insurance, some of the residences were forced into neighboring town to get supplies to repair their homes. Because the destruction was so widespread and involved several counties, some people had to travel quite a distance to get their supplies. So many people were needing building materials that the store were running low on supplies. This created a problem with finding items needed to complete the repairs. All of these repairs cost a substantial amount of money; however, incomes were also affected.
It was not just houses that suffered damages, but many businesses had to close for a few days for clean-up and repairs. This would mean lost wages for the employees. When a family is already suffering financial burdens the loss of income increases that burden. Depending on the family’s savings, this could be enough to cause the families expenses to spin out of control.
When a family has additional expenses which exceeds their available funds, this has a similar effect as a whirlpool. The family beings to spin downward and are pulled under. This is not easy to recover from. This will take several years to recover, if the family ever can recover. This puts a strain on a family and many times can break the family apart.
My Grandparents were one of those families who did not have insurance to help repair their house. They did have savings which helped them fund the repairs; however, the repairs took most of their savings. There was plenty of family that has background in construction so they were able to complete most of the work themselves. My grandfather was able to take time off work with the vacation time he has acquired over the years so he did not lose wages. Within a week, before power was restored, they were able to move back into their home. If the damages to their house was more extensive, they wound not have been as lucky.
My aunt and uncle did not fare as well. They also did not have insurance. My uncle does not work in the area and was not home at the time of the derecho. My aunt was initially left to take care of much of damages on her own. Their house had less damage then my grandparents’ home did but the difference is that my aunt and uncle did not have savings to help with the repairs. They ending up declaring bankruptcy in order to recover from the hardship. Because they were spending money to repair the damages to their home, they were not able to spend money on their bills. This caused them to be pulled under and “drown” in their financial debt.
After watching the struggles of my family following the super derecho in Southern Illinois, I find it is important to have insurance. This insurance is my “savings account” to protect me from going into debt in case of a disaster. The insurance that I believe is important is what will cover my expensive items such as my home, my car, and myself. I cannot see into the future to avoid loss to myself or my property; therefore, I will provide protection in the form of insurance.
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