Q: 5 types of insurance you need to know
Learn about the different types of insurance you need to know, including health, car, life, home, and disability insurance.
Q: – Insurance Type 1: Home & Auto Insurance
Home insurance provides protection for your property, possessions, and valuables in the event they get damaged due to natural disaster, fire, theft, vandalism, etc.
Auto insurance covers any damage done to your vehicle(s) and its contents in case of an accident. All states require both home and auto insurance.
In addition to these two major insurances you may want to purchase general liability insurance to protect yourself from legal claims when someone gets injured at your house/property.
There are many companies out there who will sell you these various insurance policies, so shop around. You don’t want to end up with something that doesn’t work for you!
Q: – Insurance Type 2: Life Insurance
Life insurance can help pay off outstanding debts, provide for medical bills, cover loss of income if you pass away unexpectedly, or even leave money to your loved ones after you die.
Most people choose term life insurance over whole life insurance plans because term plans have lower premiums than whole life plans. Term plans last anywhere from 5 years to 20 years depending on the policy.
After the initial term period expires, you will continue paying premiums until you reach 65 years old. At any time before then, you can cancel the plan without penalty.
Q: – Insurance Type 3: Disability Insurance
Disability insurance pays a portion of your wages (usually 50%) should you become disabled and unable to perform your occupation. Usually, disability insurance only pays a percentage of your monthly salary for a set amount of years, as opposed to just paying you money while you are sick or injured.
If you lose your job and cannot find employment within a given timeframe, you can apply for unemployment benefits instead. However, some employers do not offer unemployment or disability coverage as benefit packages.
Many companies offer short and long term disability programs as well. You can check with human resource departments or ask your employer directly.
Q: – Insurance Type 4: Long Term Care Insurance
Long term care insurance helps pay for care services required by those who suffer from illnesses that make them dependent upon others for their daily activities.
The amount of care provided varies depending on each state’s regulations, however generally speaking long term care insurance helps pay towards nursing home costs, assisted living expenses, and even adult daycare centers.
Q: – Insurance Type 5: Health Insurance
Health insurance helps cover costs associated with receiving treatment in a hospital or doctor’s office. Most insurance plans cover things like emergency room visits, lab fees, xrays, and doctors’ offices.
Depending on what type of plan you have, you might be able to receive prescriptions at no cost or for a small co-pay.
If you are self employed, you could potentially opt for group health insurance.
Group health insurance is offered by companies like Aetna, Humana, Cigna, United Healthcare, etc., and works similar to having your own business since you share the costs of providing your employees health care coverage.
To learn more about protecting yourself financially, I recommend checking out the following articles:
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