You work hard for your money, and the wealth you accumulate needs protection. Protecting yourself is a key principal that we briefly discussed in our introductory email of the Financial Literacy Series.
A major illness, automobile accident, or fire may leave you with unexpected expenses. Insurance can help cover some or all of these costs and reduce your risk. It’s important to be familiar with these common types of insurance:
Car insurance. Not only should you never drive around without car insurance because it’s illegal, but the average out-of-pocket expense for an accident will set you back thousands. Look into maxing out your liability insurance since that’s usually inexpensive compared to what you’d pay out-of-pocket for an accident.
Homeowners insurance. Also mandatory, you must have it to qualify for a mortgage. There are extra options like extended dwelling coverage, which increases your home’s insured value 25% to 50% above its current value. If you live in flood- or earthquake-prone locations, talk to an agent about these coverages to your existing plan.
Renter’s insurance. Most people think they only need insurance if they own a home. If you’re renting, renter’s insurance provides coverage for your personal property in the event that it’s damaged or stolen through fire, vandalism, or burglary. It also covers you if a person gets hurt or their property gets damaged in your rental too.
Health insurance. There will most likely be a time in your life when you get sick or injured. When it happens, you want to have the peace of mind that you’ll receive the care you need. Even if you have an employer-sponsored plan, health insurance is a balancing act with coverage on one side and premiums on the other. Carefully consider your circumstances before signing up so you can ensure you have the right plan for you.
The are many other insurance products to consider based on your personal circumstances. There’s no better way to prepare for a financial disaster than to buy insurance that reimburses you for the potential costs. The peace of mind you’ll have knowing you’re ready for any scenario that could otherwise leave you drowning in debt will be priceless. If you need help to determine the right types of insurance to have based on your current needs, please reach out!