Would you fly in a single-engine plane without a parachute? Would you go white-water rafting without a life preserver? Would you travel the desert without a canteen? If not, would that show a lack of faith in God? You may say that’s absurd, but many people consider insurance a lack of faith.
Many people choose self-insurance or go without insurance while others take on too much insurance. During downtimes, insurance can be a financial lifesaver. But is it wise and godly to protect against illness, death, accident, or theft? Many Christians refuse insurance simply because they argue that it takes God out of the picture. However, God’s Word instructs us to prepare for good and bad times.
When insurance is used properly it can help a family during a major illness or disability, it can provide replacement income for the loss of a spouse, it can rebuild a damaged home, and it can pay medical bills during an extended stay in a nursing home. Insurance will never cover every catastrophe, but it can be a wise way to protect the assets and income God blesses you with. You should also be careful not to allow insurance to be a replacement for God. Balancing wise planning and faith in God should be the goal of every protection plan—enough to protect your family, but not so much as to limit your dependence on God.
Balancing Insurance and Faith in God
In his book Money, Possessions, and Eternity, Randy Alcorn asks, “But where does God fit into all this? The greatest danger in insurance is that it so easily undermines our sense of dependency on God. Is insurance a God-given means of provision, or is it in reality a theological end-run that makes trusting God unnecessary?” The act of buying insurance in itself doesn’t show a lack of trust in God; instead it demonstrates proper planning. God clearly wants us to provide for our families as demonstrated in 1Timothy 5:8: “If anyone does not provide for his own, and especially for those of his household, he has denied the faith and is worse than an unbeliever” (NASB).
But we cannot be too greedy and slothful with our insurance policies either. Life insurance is a financial tool just like a mutual fund, a stock, or a CD. These tools are morally neutral. The attitude in using the tools determines whether insurance is being used properly in God’s eyes. Insurance should not be bought because of fear but rather with faith.
Jeff worked at a telephone company for nearly twenty years after graduating from high school. At thirty-seven, he was the sole breadwinner for his family. He always thought that his company would take care of him in the event of an untimely death. He was confident that his family was secure. He was a family man and loved spending time with his wife, Julie, and their two young children. They were fortunate that Jeff’s income allowed Julie to stay home with the children.
When he came in for an appointment, Jeff was shocked that he was underinsured. If he passed away, his group term life insurance would have covered only two times his yearly salary. This would last only four to six years with his family’s current expenses. His wife would have to go back to work and put the kids in day care. Jeff opted to buy additional life insurance to cover his income until the kids were through college. Sadly, this was the wisest investment that Jeff ever made.
Less than a year after being accepted for insurance, he was diagnosed with brain cancer. Jeff never reached his thirty-ninth birthday. The silver lining in the story was the policy that Jeff bought for his family. He prepared and planned and left his family in a sound financial position. Julie says, “Had Jeff not met with you, a tragedy would have been made worse. Yes, God could have performed a miracle. He could have used the church family to bail us out, but through this policy, He was able to carry us through the toughest loss we ever faced.” Julie has since gone to nursing school at night and become an RN. The insurance proceeds allowed her to pursue a passion rather than forcing her to take a job.
Insurance provides protection for unanticipated expenses you couldn’t otherwise pay. For example, in the case of Jeff and Julie, insurance was used to produce needed income after Jeff’s death. Buying insurance is like looking ahead. If you knew you would face a financial problem down the road and could afford to protect your family and your assets at a fraction of the replacement cost, why would you not at least consider it? Insurance also frees up surplus funds.
In Jeff and Julie’s case, Jeff made $85,000 a year. When he died, the family still needed at least $75,000 in yearly income. Social Security provided around $12,000 a year for dependent care. The family still needed $63,000 a year to cover the gap. Where would these funds come from? Jeff and his family could have saved over time, but in this case he had less than a year to live. The other alternative was to buy life insurance, which he did, and that turned out to be the wise choice. No one knows what the future holds, but planning ahead is prudent and resourceful.
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