The saying is "Lies, damn lies, and statistics" but when it comes to planning your future and protecting your family, finding the probability of an outcome is key to painting an accurate picture and achieving your goals.  So let's take a look at some odds.

You buy a house.  It's exciting and probably the biggest purchase of your life, aside from the money for your retirement, so of course you insure it.  No question.  But do you know the odds of actually claiming on your house insurance by age 65?  Only 1 in 2,766*. 

Now car insurance is a necessity.  You cannot drive without it, of course, but even with all the accidents out there the odds of using your insurance by 65 is still only 1 in 1,685*.  Hopefully, that makes you feel a little safer next time you hit the road.

When it comes to protecting your family in case of your untimely death, the odds are unfortunately much greater than the car insurance claim at 1 in 146 people by age 65*.  The good news is that protecting your family's financial future in the worst case scenario is less costly.  For example, a 35-year-old male non-smoker in average health for his age could purchase $500,000 of life insurance on a ten year term for only $26.10 per month.  I don't believe there's a car on the road in BC that is paying that little for their insurance.

You are your own money making machine but the odds of you not being able to work and having to claim on some sort of disability insurance policy before the age of 65 is merely 1 in 14*.  If you play a team sport, it's likely that at least one person on your team has been affected by a disability at some point in their working lives.

The most costly form of personal insurance is also the newest form: critical illness insurance.  This insurance pays out a lump sum to you if you are diagnosed with and survive one of the covered critical conditions.  Most insurance companies policies cover the big three illnesses of cancer, stroke, and heart attack as well as 20+ other critical conditions such as paralysis.  The reason this is the most expensive type of protection is because the odds of claiming on it before age 65 are 1 in 3*.  That's it.  And even though critical illness insurance is more expensive than life or disability insurance, when purchased at younger ages, it's still quite affordable.  Take the same 35-year-old man from the life insurance example and give him a critical illness policy for $100,000 with level premiums till age 75 and the cost would be approximately $78 per month.  You might find that a bit high but add on the return of premium benefit for $14 per month and if you are one of the lucky 2 out of 3 who does not need to claim on the critical illness policy, you get all your money back at age 75.  You can consider those premiums paid as protection with a forced retirement savings plan.
 
Speaking of retirement savings - how long will you need your money for?  The average retirement age in North America is 63 and if you take a look at the chart below, you can see that means the average Canadian male has just over a 50% chance of living past age 86.  That means that between him and his neighbour, one of them is going to be funding their retirement for over 23 years.  Have you taken a long life into account when making your retirement plans?

Maybe you are a bit of gambler but when you take a look at some odds, it's probably best not to bet against your future.

* Source of statistics Manulife Financial presentation on Dec.1, 2009