When it comes to insurance, there are two main types of life insurance: traditional whole life insurance and term life insurance. Calculating the amount of life insurance you need is essential to ensure your family's financial security. This includes funeral expenses, mortgage payments, outstanding loans, credit card debt, taxes, child care, and future college costs. Health insurance can be obtained through your employer, the federal health insurance marketplace, or private insurance.
You can contact health insurance companies directly or use a health insurance agent to find the best coverage for you and your family. Health insurance pays for hospitalization and medical bills, but you may still have to bear all the expenses that your paycheck had covered. Many employers offer short- and long-term disability insurance as part of their benefits package. This is usually the best option to ensure affordable disability coverage. Most experts agree that the four types of insurance you should have are life insurance, health insurance, long-term disability insurance, and car insurance.
Employer coverage is often the best option, but if it's not available, ask for quotes from several providers, as many offer discounts if you buy more than one type of coverage. Homeowners coverage is not required by law, but if you financed your home, your lender will normally require coverage to protect your interests in your property. Auto, home and renters insurance include liability coverage that protects your assets and those of your family from lawsuits brought against you. However, all policies have limits of liability. If you have significant assets, your home insurance, renters insurance, or auto liability insurance may not be enough if you lose an expensive lawsuit. Liability insurance covers you in the event that you have a covered car accident and the accident is determined to be the result of your actions.
Liability insurance will cover the cost of repairing any property damaged by an accident, as well as the medical bills for the resulting injuries. Most states have a minimum requirement on the amount of liability insurance coverage drivers must have. However, if you can afford it, it's usually a good idea to have liability insurance that exceeds your state's minimum liability coverage requirements. Collision coverage will pay for repairs to your car if there's a covered accident. If your car is destroyed (when the repair cost exceeds the value of the vehicle) in an accident, collision coverage will pay for the value of your car.
Comprehensive coverage (other than collision coverage) covers situations when something happens to your car that isn't related to a covered accident (weather damage, bumping into a deer, or having your car stolen).Protecting uninsured or underinsured motorists would help with expenses in case someone is legally responsible for damages related to an accident but they don't have coverage or their damages exceed their policy limit. Anti-theft and tracking devices on cars can make this coverage a little more affordable but taking out this type of insurance can be expensive and may not be necessary especially if the car is easily replaceable. Types of permanent life insurance include comprehensive life insurance, universal life insurance, variable life insurance, and life insurance for burials. If you're buying life insurance, you can add long-term care coverage to your policy as an additional life insurance clause or buy a policy that combines life insurance and LTC coverage.
