4 Types of Insurance Policy Products You Need – Insurance can give you peace of mind if you know you are protected from the unexpected, because we all won’t know what tomorrow will bring. You can find insurance products or policies to cover almost anything imaginable but some are more appropriate than others from somewhere in your financial plan. When you map your financial future, these four types of insurance policies should actually exist for your next financial goal.
1. Health Insurance
The type of insurance product or policy that you need first is health insurance, this is one of the most important types of insurance products to have. Your good health allows you to always be able to work, earn money, and enjoy life. If you have a serious illness or have an accident without insurance, you may not be able to receive good treatment or even owe money to the hospital and your relatives.
Thankfully, many employers and companies provide health insurance benefits to their full-time employees and even some part-time employees. If you don’t currently have health insurance coverage, this is the first place to check as it will generally be the most affordable. If you are married, you may be able to receive coverage only under one of the plans from your boss. When your employer provides health insurance, careful comparisons can help you decide which plan to use. Always consider looking at co-pays, deductibles, premium fees, network coverage and covered costs to determine which plan yields the most benefits.
If your company does not offer health insurance or you are self-employed, you should explore your insurance options. The federal health care market is a good starting point; alternately, you can contact the insurance company directly to see what type of coverage is offered to you. Again, the same criteria used to evaluate your company’s plans need to be taken into account when you compare policies, in terms of costs and coverage.
While buying health insurance privately may cost more than getting it through your company, there may be a silver lining. If you are self-employed or freelance worker, the health insurance premiums you pay qualify as a tax deduction. A deduction reduces your taxable income for the year, potentially lowering your tax bill or increasing the size of your refund.
2. Life insurance
This type of life insurance policy product is more important if you are married and / or have children, but even single people can benefit from having life insurance. Although none of us would expect to die young, having life insurance is important for good reason.
Life insurance can meet several financial needs. In the case of someone married to the family, it can replace lost income, help pay off debts left over after your death or pay for your children’s college education. If you are single, life insurance can pay for funeral expenses and pay off any debts you left behind.
If you don’t currently have life insurance, your best bet is to check with your boss first. Many employers offer basic group life insurance as a benefit and some even allow you to purchase additional coverage at a very affordable price. If the company does not have such a program, then there are dozens of insurance companies that can provide the right protection for you.
One thing to consider is whether to buy term insurance or permanent life insurance. Term life insurance covers you for a specific period of time, usually five to 30 years. Permanent insurance protects you throughout your life, as long as the premium is paid. This type of coverage also allows you to build up a cash value that you can borrow or invest for growth. Of the two, term life insurance tends to be more flexible and less expensive but if you are looking for an investment component you may prefer permanent coverage.
Remember, with most types of life insurance, your ability to get coverage depends on your age and health profile. The younger and healthier you are, the lower the costs but be prepared to take a short medical exam as part of the life insurance application process. There are several life insurance companies that offer life insurance policies without exams. While this may be easier to implement as you may only need to fill out a short health questionnaire, this type of coverage can carry a higher premium.
3. Property insurance
One type of insurance policy that most people are actually required to have is home owner insurance when you have a mortgage. If you borrow money from the best bank To buy your house, they will need assets to be insured. For many people, this insurance premium is included in the mortgage payment. For many people their home is their greatest asset so it is very important to protect it adequately by signing up for insurance.
If you rent and don’t own your own, a tenant insurance policy is just as important. Your belongings in the dwelling can add up to a significant amount of money. In the event of theft, fire, or disaster, you should at least have a policy that can cover most replacement costs. Home owner and tenant insurance can also protect you from personal liability if someone is injured in your home.
As with other types of insurance policy products, take the time to compare coverage and premiums. Homeowners insurance, for example, may not cover you in the event of damage from a flood or damage from an earthquake. If you live in an area prone to these types of events, you may need to supplement your policy with additional natural disaster coverage.
4. Car Insurance
Another type of insurance policy product that is often needed is car insurance. Most states require by law that you have basic car insurance that covers liability. If you’re buying a car on loan, you may also need to add collision coverage to your policy. If you have an accident, liability insurance covers damage to other vehicles, while the collision covers damage to your vehicle.
The most common reason for having car insurance is to cover expensive asset replacement. Like homes, cars can be very expensive and if they break down you will want to be able to repair or replace them. But there is a lot more to car insurance than just covering the damage to the car itself.
Most types of automotive insurance policy products cover bodily injury or death of another person in an incident for which you are legally responsible. Although it generally pays for the medical costs associated with the incident, it can also cover legal defense costs. You will also usually find medical payment coverage that pays for medical care for you and your passengers during an accident regardless of who is at fault. You can also include car rental coverage in your policy in the event of an accident that renders your car irreparable.
Remember, the more coverage you add to your policy, the higher the premiums will be. However, there are possible solutions to make any insurance more budget friendly. The higher your deductible, the more you can lower your monthly premium costs. However, you don’t need to force yourself to have all types of insurance products as written above. Think and choose which one is most important to you and within your abilities.