When Insurance Is Useful
Identify the risks that would cause the most financial hardship if uninsured — and prioritise covering those over lower-impact risks when budget is limited.
In this lesson
When Insurance Is Useful is part of Sharing the Cost of Risk. This preview shows how insurance-intro connects to everyday family decisions such as earning, saving, spending choices, goals, approvals, or parent-guided money conversations inside Progress Penguin.
Think about this money choice
Ngozi's family is deciding whether to insure their old television or their health. They can only afford one right now.
How it works
When choosing what to insure first, prioritise the risks that would cause the most financial hardship if they occurred. Health risks — illness, injury, hospitalisation — are typically more financially devastating than property risks. An insured health risk means a major illness does not destroy the family's finances. An uninsured one can.
Try a real-life example
Real-life money moment: Ngozi's family can afford one insurance policy. Option A: health insurance at 3000 in local currency/month. Option B: television and electronics cover at 1500 in local currency/month. Their television is three years old and worth 80000 in local currency. A hospitalisation could cost 300000 in local currency+. Which risk is larger — and which insurance is more important? — Health. The potential loss is four times larger and cannot be funded by selling assets.
Activity preview
Choose the best money move
Use what you just learned. Choose the option you can explain.
Try one real money action
Open Tasks and submit proof for one task, or open Requests and make a deposit request. Parent approval can happen later.
Quiz preview
When Insurance Is Useful is when:
Which situation best justifies buying insurance?