Do rich people need insurance?

Question

I was just wondering..if they have so much money....do they really need insurance?

Answer 1

Insurance is a financial tool.  Rich people tend to get rich, by using financial tools.  

They'd rather pay a fixed $300 a month for their health insurance, than risk a possible six or seven figure health condition.  

That's what money management is all about.

Even in states where you can post a bond instead of buying auto liability coverage - wealthy people measure what that bond could be earning, vs. what they could be out of pocket in a major loss, and auto insurance is still a really good deal.  The only people I know of that don't want to have to buy insurance, are the ones that need it most - they're just really rotten money managers.

Answer 2

Yes........risk management.......they can pay 1K per month until they die.........one serious illness and all thay money will be paid back and then some.......heart bypass.......a real issue these days will cost $100K............long term care will eat your shorts........

Answer 3

all human are a dream, rich man or poor man no problem ,they have the dream like, poor man want to richman and rich man want much much richer, so find out what is the dream and remember all reach man take maximum loans from banks or any financial institutions, if he take the maximum insurance coverage that her family life is safe otherwise he is a rich man , but after her death her family may be ?

Answer 4

Insurance is really a way to displace a risk that you cannot or would rather not afford.  It works because of a mathematical principle called the Law of Large Numbers.  Most rich people have the business sense and free-time to understand that an individual could not have the Law of Large Numbers on their side unless they paid for it.  So yes, rich people need insurance for the risks they either could not afford or would rather not afford themselves.  In fact, they seem to like it better than poor people.

There are also certain tax advantages that come into play with insurance products that make the opportunity costs of insurance contracts more appealing than the IRS.  Here's to hoping you'll need to make that type of choice one day....

Answer 5

The rich get richer by purchasing insurance and transferring wealth. The beauty of life insurance is that it can be used to leave an inheritance tax free.

Answer 6

Do poor people eat food? Of course. No matter how much money you have, insurance is a relatively cheap way to ensure you get your money back in the event of illness, accidents, etc. PLUS -- personal liability insurance is huge if you have assets to protect. People know you have money and they will not hesitate to drop a stupid lawsuit on you for any little thing.. and the way the justice system works, they will get rewarded for it.

Answer 7

They especially need insurance.

Think about it......a rich person hits another car. Does not really matter how bad the damage is or if the person was actually hurt. They are going to run to the Dr -- run up a big bill -- hire an attorney and sue. Folks are more likely to come down with lottery syndrome when they realize they were hit by a rich or famous person. A rich/famous person has assets they need to protect.

Therefore, a rich/famous person would be wise to purchase a very very large insurance policy. The policy would pay for defense costs (which can be  very expensive) and for judgments up to the policy limit.

Answer 8

no but it is a lot easier to make payments monthly then it is to to pay a large sum all at once

rich people don't need it but it is not a bad thing

Answer 9

Of course they do.