Protect Your Assets: Insurance Policies You Should Have


5 September,2011

One of the realities of life is that there are a lot of unexpected expenses and surprise problems. While it might not be such a big deal when your car needs a couple of new tires for $200, it can be financially devastating if you are in an accident with an uninsured motorist and need to come up with $1,000 or $2,000 for a down payment on a new car.

Insurance can help you cover the costs of the big expenses that can sometimes crop up unexpectedly. While not all insurance is necessary, there are some types of insurance that you should have:

Auto Insurance

Nearly all the states in the U.S. require you to have some sort of auto insurance. You are supposed to have liability insurance so that if you cause an accident, your insurance company will pay the costs associated with your accident. This protects you as well, since it can prevent your having to come up with thousands of dollars on your own.

It can also help to have other types of insurance, such as collision and comprehensive, so that you are protected even if the damage is only to your own property, or if an uninsured driver hits you.

Home Insurance

Insuring your home can be a rather important thing to do. Your home is your biggest asset. If it is damaged, you might not be able to afford to pay for repairs. Home insurance can help you pay these costs so that you aren’t doing it all out of your pocket. Renters insurance can also be a big help. Renters insurance can protect your belongings from damage that the landlord’s policy may not cover.

Health Insurance

You do want to make sure that you are able to pay for medical expenses. Health care can get quite pricey — especially if you end up in the hospital. You can quickly end up owing tens of thousands of dollars in some cases. At the very least, a major medical policy can help you pay these costs. You can combine your health insurance plan with a Health Savings Account to help you control more of your money, and save a little bit in premiums.

Also, it might be worth it to consider disability insurance in some cases. That way, if you are unable to work, you can still receive some income for your family. The self-employed can especially benefit from disability insurance, since they won’t have access to the Workers Compensation that other workers might benefit from.

Life Insurance — For Your Family

When you get life insurance, you aren’t getting it for yourself (unless you are looking for peace of mind); instead, life insurance is about making sure your family is provided for. Get enough life insurance so that your family can pay funeral expenses, pay off debt, and have enough to provide for their needs for a few years. This is especially important if you have young children. Life insurance is a necessity for those who want to make sure their families have the financial resources they need in the event the primary breadwinner passes on.