The Rock

“The prudent see danger and take refuge, but the simple keep going and suffer for it.” (Proverbs 27:12)

Do you take heed of warning signs or plow on ahead?
Do you take heed of warning signs or plow on ahead?

Let’s look more closely at the roots of your Fruitful TreeAs mentioned, this is the protection of your tree.  In your financial life, protection is garnered through the use of contracts.  The two primary types of contracts are insurance policies and legal documents (wills, corporations, etc.) drawn up with an attorney.  We’ll focus on your insurance first.

There are two major categories of personal insurance that you should have.  The first is insurance that covers your Property Value.  The second covers your Human Life Value.

Let’s define Human Life Value (HLV) first.  Of course in a spiritual sense, each person is uniquely and perfectly created by God and therefore has an infinite and unquantifiable HLV.   On the other hand, in this world, financial institutions and courts of law assign value to things and so quantify each person’s value in the world based upon their age and income.  So your financial success will be based on how much you make, and for how many years will you be making that amount.  A present value is then calculated for this amount based upon the Time Value of Money concept (a dollar today is worth more than a dollar in the future). This value shows the economic impact your life will have.  In reality, this number typically undershoots the actual HLV of a person over time because people usually earn more and more income over time, and this calculation must be readjusted, but companies most often choose the more conservative math.  However, most people are shocked at how big the number is when they hear their own Human Life Economic Value as a dollar figure.

When it comes to personal insurance, most people are good at covering the property value of the things that they own.  Often this is required by the bank that owns a property’s collateral.  Even so, people seem to easily grasp the idea that they paid a certain amount for their property and, thus should insure this amount in case something happens to their property.  But many are not so quick to understand the value of insuring their own human life value – which is far more important and valuable.

Life parallels this oddity.  Most of us go about our lives far more concerned with our physical/material life than our spiritual life.  We’re obsessed with what we can see and touch, but not with who we are.  And yet, someday soon, this life will be over and we will live an eternity reflecting the choices of this life. (1 Peter 1:24)

The choices most people make in insurance reflect this carnal tendency to value that which is immediate and obvious over that which is truly important.  Which is more valuable – something you own, or your ability to produce the income that bought it?  This is the essence of the difference between insurance focused on property value vs. insurance focused on HLV.  If everything you own is destroyed, you can recover from this major financial setback, but where will you be if your ability to earn an income disappears?

Philosophically, this may seem like a simple question, but as we look into the specifics in the days ahead, you will see that it is counter to the way most people are currently doing things.

This post is _Part 1_ in the series The Rock. To continue with this series, click on Pt 2.

Photo credit: Chris C. Gray

Get Instant Access To