http://reborn-babies-dolls.com/reborn-baby-doll-allison-a-lilly-sculpt-by-denise-pratt/ Six insurance policies you need to have and four you likely don’t
Insurance is necessary, but what types of coverage do you need and how much? This can be a tricky question, and one many people struggle to understand. Your home, car, and family are the obvious needs, but what falls under the category of unnecessary coverage?
Here is a comprehensive guide on the insurance you need and what you don’t.
buy cheap generic provigil Six types of insurance you need to have
1. Homeowners or renters insurance
Homeowners’ insurance is meant to help you replace or repair your home and belongings if they are damaged. It also includes liability coverage to protect you if someone else is injured on your property.
When purchasing a policy, be sure you understand what is covered and what is not. For instance, some states require you to purchase separate policies for flood or wind damage caused by a storm such as a hurricane. The same goes for earthquake coverage.
If you rent a house or apartment, it’s a good idea to buy renter’s insurance to help replace your belongings if they are lost or damaged. Some landlords require tenants to buy renter’s insurance.
2. Auto insurance
Most states require you to buy auto insurance. It’s meant to help pay for repairs or injuries if you cause an accident. There are a few options when it comes to auto coverage. You are required to have some policies, while others are optional. Be sure you know the laws in your state regarding what auto coverage is required.
3. Umbrella insurance
An umbrella policy covers you if an incident exceeds the coverage limits of your homeowner’s or auto insurance. If you are someone with a high net worth (over $500,000), it’s a good idea for you to have a personal liability umbrella policy in case you are ever sued.
4. Health insurance
Health insurance helps you pay for medical expenses, from doctor’s appointments and hospitalization to prescription medications. Most employers offer health benefits, but if yours doesn’t – or you don’t qualify for their group coverage – you need to have an individual policy.
5. Long-term disability
What would happen if you were injured or got sick and couldn’t work for some time? How would you continue to pay your bills?
Disability insurance provides at least part of your income until you can get back to work. Your employer may offer short and long-term disability, but if they don’t, consider buying a policy on your own.
6. Term life insurance
What would happen to your family if you passed away? How would they pay for your final expenses and survive long term? A term life insurance policy can protect your loved ones and dependents financially, so they never have to worry.
Experts recommend that a term life insurance policy should include 10-12 times your yearly income.
Four types of insurance you might not need
We’ve looked at necessary and required insurance coverage. Now, let’s think about coverage you don’t necessarily need. Please note that these are general recommendations. It’s important to consider your circumstances when assessing the need for any type of policy.
1. Private mortgage insurance
This type of insurance is designed to protect lenders who are dealing with high-risk borrowers. If you have poor credit or put down less than 20% of a home’s value, you are required to buy private mortgage insurance.
However, it ends up increasing your monthly mortgage payments. If you can, ensure your down payment is at least 20% of the total value. This way you will not have to buy coverage.
2. Extended warranties
If you own a car or appliance, you might have been offered an extended warranty. These policies help pay for repairs or replacement of goods once they’re no longer under warranty. Most experts see extended warranties as unnecessary as they are rarely used. These policies often have an extensive list of exclusions, as well, so you might never see money anyway.
3. Collision insurance
Auto liability is required in most states. Collision insurance is not. It’s meant to help cover the cost of repairs or replacement if your vehicle is damaged in an accident. If you have a new or expensive car, this type of coverage might help you.
However, if your car is older or paid off, the extra money in monthly premiums might not be worth it.
4. Mortgage life insurance
This policy is designed to pay off your house in the event of your premature death. While this might seem sensible, you are better off getting term life insurance, which can help do the same thing. There’s no need to buy a separate policy and pay an extra premium every month.
Many kinds of insurance are necessary (and even legally required). However, some might not make sense for your situation and are not worth the extra expense. Speak to an insurance specialist to determine your specific needs. If you have any questions or you would like a quote, contact us today.
This blog and website are made available by the publisher for educational and informational purposes only. It is not be used as a substitute for competent insurance, legal, or tax advice from a licensed professional in your state.