The 5 types of insurance you should have

Insurance protects us if something unexpected happens, but which types are the most important? Please review the policies outlined below and consider what coverage you may need.

Tenant insurance

Renters Insurance - Types of Insurance You Should Have
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If you are renting a house or an apartment, it is essential to have insurance for cover your property. But most renters don’t get tenant insurance, probably because they assume their landlord’s policy covers them.

In addition, many people greatly underestimate the value of their property. If you add up the value of your electronics, clothing, and furniture, it can easily run into the tens of thousands of dollars. When you buy a good tenant insurance policy, you know that you will be reimbursed for the loss of your property in the event of fire, water damage or any other covered peril.

One more reason to take out tenant insurance: civil liability. If your friend slips on your kitchen floor and breaks their arm, they might be chasing you. Renters insurance also protects you in this situation.

Home insurance

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Home insurance protects your home against damage and theft, and it also covers your belongings. If you have a mortgage, you are required to have home insurance, but you should have it even if you own your home.

This insurance covers damage inside or outside the home caused by hurricanes, fires, lightning, vandalism and other covered issues. However, damage caused by improper maintenance, flooding or earthquakes is not covered.

Life insurance

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Life insurance is important because it pays for funeral expenses and provides for the financial needs of your loved ones you leave behind. This is essential if you have a family that relies on your income to pay off the mortgage and other major expenses.

Many industry experts recommend buying a life insurance policy which covers ten times your annual salary. If you can’t afford it, just make sure you buy enough to cover the mortgage, car payments, and other major obligations for at least five years. This will give your family the time they need to get back on their feet financially.

You can buy whole life or traditional term insurance. Whole life insurance is an investment instrument and insurance, while term life insurance only offers the life insurance part. Term is the cheapest insurance and what most people buy.

Health insurance

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Studies show that most Americans are just one major disease of bankruptcy. “Two-thirds of people who file for bankruptcy cite medical problems as a key factor in their financial downfall,” according to CNBC.

The best choice for most people is to participate in your company’s health insurance program. But if you are self-employed, check with professional groups or associations about purchasing group coverage.

Car insurance

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Every state requires you to have auto insurance if you drive on public roads. It is wise to have auto insurance not just because it is the law; the typical loss per car accident claim is around $ 5,000. Can you imagine if you have to pay this out of your checking account?

There are several types of auto insurance to consider:

  • Liability: If you cause a car accident, this coverage covers the costs of property damage and injuries to other parties. Each state requires that you have a minimum level of liability insurance, typically $ 25,000 for bodily injuries per person and $ 50,000 per incident.
  • Collision: This pays for the replacement or repair of your vehicle if it is damaged in the accident. This is optional coverage if you own your car, but it is mandatory if you finance or lease the vehicle.
  • Full: This covers damage caused by vandalism, hail, fire, etc. It also pays in case of theft of the vehicle.

Now that you know the types of insurance you should have, talk to your insurance agent to get a quote or compare policies and prices online.