{
    "success": true,
    "data": {
        "id": 1607421,
        "msgid": "living-in-disaster-prone-areas-is-emergency-fund-or-insurance-more-important-1773298379",
        "date": "2026-03-12 13:25:02",
        "title": "Living in Disaster-Prone Areas: Is Emergency Fund or Insurance More Important?",
        "author": "Sakina Rakhma Diah Setiawan",
        "source": "KOMPAS",
        "tags": "",
        "topic": "Social Policy",
        "summary": "Financial planners in Indonesia advise residents of disaster-prone areas to prioritise building an emergency fund (equivalent to 6-12 months of expenses) before purchasing property insurance, as emergency funds provide broader coverage including living costs and relocation expenses. However, a hybrid approach may be necessary when homes are financed through mortgages, as banks typically require insurance coverage whilst families build their emergency reserves simultaneously.",
        "content": "<p>Jakarta \u2014 Living in Indonesia means coexisting with various natural\ndisaster risks, ranging from earthquakes and floods to landslides.\nIndonesia\u2019s geographical location in the Pacific Ring of Fire makes\nthese risks unavoidable and potentially creates significant economic\nlosses for communities.<\/p>\n<p>In this context, financial preparedness becomes an important factor\nin mitigating the impact of losses. Financial planner Rista Zwestika\nstated that families living in disaster-prone areas need to understand\ntheir priorities when preparing financial protection.<\/p>\n<p>According to her, emergency funds should be prioritised over property\ninsurance protection related to disaster risks. An emergency fund is\nmoney set aside to face urgent situations such as job loss, health\nproblems, accidents, or house damage caused by disasters.<\/p>\n<p>She explained that emergency funds have broader protection coverage,\nincluding living costs, relocation expenses, medical costs, and other\nemergency needs. In ideal planning, families are advised to have an\nemergency fund equivalent to 6 to 12 months of monthly expenses.<\/p>\n<p>After these needs are met, protection can be supplemented with\nproperty insurance that includes natural disaster coverage extensions.\nHowever, Rista noted that certain conditions allow insurance to take\nprecedence over emergency funds. One such situation is when a home is\nstill under a mortgage scheme (KPR), as banks generally require\ninsurance protection.<\/p>\n<p>\u201cBanks typically require insurance,\u201d she said.<\/p>\n<p>Under such circumstances, the strategy that can be applied is a\nhybrid approach by building an emergency fund gradually whilst having\nbasic insurance protection.<\/p>\n<p>\u201cBuild emergency funds gradually, whilst obtaining basic insurance,\u201d\nRista said.<\/p>\n<p>She also revealed that a common mistake among people in\ndisaster-prone areas is having neither emergency funds nor insurance\nprotection. When disasters occur, this condition causes communities to\npanic due to lack of financial preparation.<\/p>\n<p>Financial planner Mike Rini from Mitra Rencana Edukasi emphasised\nthat emergency funds and property insurance with natural disaster\ncoverage extensions have different functions. Emergency funds serve to\nanticipate income loss, whilst property insurance aims to anticipate\nasset damage.<\/p>\n<p>\u201cIf you have your own emergency fund, you can use it anytime.\nProperty insurance requires a claims process,\u201d Mike said.<\/p>",
        "url": "https:\/\/jawawa.id\/newsitem\/living-in-disaster-prone-areas-is-emergency-fund-or-insurance-more-important-1773298379",
        "image": ""
    },
    "sponsor": "Okusi Associates",
    "sponsor_url": "https:\/\/okusiassociates.com"
}