Insurance against debt
Insurance protects the various affairs of our lives. Our usually mandatory automobile policies ensure that an accident would not require the purchase of a new vehicle. Health policies allow us to receive medical care at restricted costs. Our homeowners’ policies protect valuables against damage or theft. Policies on our lives provide for our loved ones and also serve as a valuable investment resource for the insured. Unfortunately, our financial affairs are not so neatly regulated. Even with a job and without splurging, many of us find ourselves facing an unaffordable level of debt. Most often, the level of debt arises because we have been extended credit for a house or card account we cannot possibly afford given our means. Unexpected circumstances can also throw our finances off balance. A period of unemployment without steady income might require over-reliance on credit cards. A medical condition might make good use of health coverage, but even if provider charges are written off over covered insured amounts, such conditions might require time off work and frequently result in large amounts of uninsured expenses. It is easy to get into such debt but more difficult to find the resources to successfully deal with it. The under-regulated debt settlement industry thrives off consumers who are looking for “easy” fixes to avoid the supposed shame and temporary credit damage caused by a personal bankruptcy filing. These people would be pleasantly surprised to know that even the restrictions under the current bankruptcy law allow liberal amounts for household income by localilty to qualify for bankruptcy. Moreover, means testing is available for over-income households who still face too high a level of debt. Property exemptions are limited, but the material possessions of another era have increasingly in an era of overwhelming debt given way to a more spartan lifestyle.
