Which insurance policies should you buy | KYABAE
“Unless you’re immortal, you need insurance policies!”
You work hard throughout your life to build wealth and ensure that you and your loved ones can live a happy and comfortable life, but a single mistake – of not having adequate insurance plans – can reverse all your hard-work in just a few moments. But, thankfully today, you can find an insurance policy to cover almost anything imaginable, but some are more deserving than others of a place in your financial plan. As you map your financial future, these four types of insurance should be firmly on your radar:
- Life insurance
This type of policy is more important if you are married and/or have children, but even single people can benefit from having life insurance. Life insurance can meet several financial needs. In the case of someone who’s married with a family, it can replace lost income, help to pay any lingering debts after your death or pay for your children’s college education. If you’re single, life insurance could pay pay off any debts you leave behind, and give some extra money to your family as well.
There are two basic types of life insurance policies – Traditional Whole Life and Term Life Insurance. A whole life is a policy you pay till death of the policy holder and term life is a policy for a fixed amount of time. Term plans are the most basic form of life insurance. They provide life cover with no savings / profits component. They are the most affordable form of life insurance as premiums are cheaper compared to other life insurance plans, and are one of the most recommended types of insurance policies. A whole life insurance policy covers a policyholder over his life. The main feature of a whole life policy is that the validity of the policy is not defined so the individual enjoys the life cover throughout his life. The policyholder pays regular premiums until his death, upon which the corpus is paid out to the family. The policy expires only in case of an eventuality as there is no pre-defined policy tenure.
- Health insurance
Your good health is what allows you to work, earn money and otherwise enjoy life. If you were to develop a serious illness or have an accident without being insured, you may find yourself unable to receive treatment or even in debt to the hospital. While health insurance is not mandated by the government, it’s not something to discount.
Many employers provide health insurance benefits to full-time as well as part-time employees. If you’re working somewhere, this is the first place to check if you are covered by any health insurance. If your employer does not offer health insurance or you’re self-employed, you’ll need to explore your insurance options. Consider the co-pays, deductibles, premium costs, network coverage and covered expenses to determine which plan yields the most benefits.
- Property insurance
One other type of policy that is very important is homeowner’s insurance, especially when you have a mortgage. If you borrow money from the bank to purchase a home, they will require the asset to be insured. For many people, this insurance premium is built into the mortgage payment. For most people, their home is their greatest asset so it is vital to adequately protect it.
If you rent instead of own, a renter’s insurance policy is just as important. Your belongings inside the dwelling can add up to a significant amount of money. In the event of a burglary, fire or disaster you should be able to at least have a policy that can cover most of the replacement costs. Both homeowner’s and renter’s insurance can also protect you against personal liability if someone is injured at your home.
- Auto insurance
Another policy that is also mandated by law is an auto insurance. The most common reason to have auto insurance is to cover the replacement of an expensive asset. Like a home, automobiles can be quite expensive and if it gets damaged you want to be able to repair or replace it. But there is more to auto insurance than just covering the car itself. Most automotive insurance policies also cover bodily injury or death in an incident that you are legally responsible.
Ensure that you have an easily accessible list of all insurance policies of you and your family members as well, because, failing to prepare is preparing to fail!
Disclaimer: The above article is curated based on limited and publicly available open source information. The views and opinions expressed therein and all data and information so provided is solely for informational purposes, to be used at the sole discretion of the reader. If you disagree with any article or any part thereof, please contact us and we will resolve the issue at the earliest. KyaBae makes no representations as to accuracy, completeness, currentness, suitability, or validity of any information and will not be liable for any errors, omissions, or delays in this information or any losses, injuries, or damages arising from its display or use.