Different Types of Insurance
Insurance is something people get for protection against the financial impact an accident or tragedy can have. Since there are various parts of your life where these accidents can occur, there are different insurances for each circumstance. Here is a little information about the main types of insurance.
First up is health insurance. While many people have health insurance through their employee, not everyone does. And even if you don’t have it through work you should try to get some sort of policy. When you are considering health insurance policies you should consider both the deductible (what you’ll pay out-of-pocket for health care) as well as what will be covered by your policy. The most common types of health insurance are PPOs (preferred provider options), which allow you to refer yourself to any provider in your PPO’s list, and HMOs (health maintenance organizations), which tend to be least expensive and most restrictive, usually assigning you a primary care physician that decides what medical treatment is necessary for you.
Auto insurance is another biggie. Most states require auto insurance, making it illegal to drive a car without it. Auto insurance protects you against any liability you have to others in case of a car accident as well as any damages done to you, your passengers or your vehicle. Generally, how much of this insurance you need depends on your assets. If you have an older car, rent your house or apartment and don’t make much annually then you don’t really need a lot of coverage. If you have a newer, expensive car that would be hard to replace then you might want to consider having more auto insurance in case of an accident.
Another type of insurance is life insurance. Life insurance policies generally cover the replacement of the policyholder’s income or work, estate taxes, and burial costs. To replace what a family member is contributing with life insurance you need to purchase around 12 times the amount of money they contribute annually.
A final type of important insurance is homeowner’s insurance. This protects you in case of damages to your home and property because of natural disasters such as fire, flood or hurricanes. When looking for a homeowner’s policy consider the different amounts of coverage offered other than on the house, the deductibles and percent of loss covered. Also keep in mind that basic homeowner’s insurance doesn’t cover the contents of your home so you’ll need to add it in or purchase it separately. If you rent or own a condo you only need insurance that covers the contents of your home and possibly liability insurance.
While these are only a few types of insurance available, they are the main ones and the ones that everyone should have at least a little coverage for. When purchasing any type of insurance be sure to do your research and shop around for what fits your needs best.