Find out what insurance you should have and how you can save the most money on your policies
Insurance, whether it’s car, home, life, or health, can be tricky to navigate. Some states require you to have certain types of insurance while others don’t.
Insurance can be complicated, making it hard to decide which types are necessary for financial protection. This can quickly become overwhelming.
To help you navigate the ins and outs of insurance, let’s talk about the top insurance types to consider for your family and how you can save money on your insurance policies.
Depending on your family and your needs, there are a couple of different types of insurance you may consider having to give your family a certain level of protection. While your family may not need every type of insurance policy below, this list can help you get started determining which insurance coverage you and your family need the most.
Out of all the insurance policies, you should always prioritize your health insurance. The way health insurance works is an insurance company and an insured person reach a contract agreement determining what the insurance company will pay and what is required of the insured to cover. The insured person pays a monthly premium and as they receive medical treatment, the insurance company pays for part or all of their medical expenses that are covered in the contract.
Sometimes health insurance is provided as an employment benefit, but unemployed people, contract employees, or self-employed people can buy life insurance policies through the federal or state Health Insurance Marketplace.
Depending on where you live, health insurance may be required. If you live in a state that does require you to have health insurance and you don’t have a policy, you will have to pay a tax penalty. But, if you live in a state that does not require health insurance, it’s still a smart idea to get a policy.
Though health insurance can be frustrating to navigate and understand, paying for health insurance is often far less expensive than paying for medical care out of pocket. Plus, having health insurance for you and your family makes it much easier to stay healthy since going to the doctor won’t cost as much as it would if you did not have insurance.
Life insurance is generally overlooked when people consider insurance, but it shouldn’t be. Life insurance is a type of policy that can financially support your family if the policyholder were to pass away while insured. The death benefit of a life insurance policy can help families pay for funeral expenses, childcare, large debts, and any other financial hardships that may come.
The main reason why people don’t get this type of insurance is that they incorrectly assume life insurance policies are too expensive. While life insurance policy costs are different from person to person, it’s actually very possible to find affordable rates.
One of the most popular affordable life insurance policy types is term life insurance. A term life insurance policy covers a policyholder for a certain period of time, which is typically anywhere between 10-30 years. This type of policy is generally more affordable than other policy types, like permanent life insurance, because it only covers the policyholder for that time period, and the death benefit is the only perk.
Permanent life insurance, on the other hand, covers a policyholder for their entire life and carries something called a cash value which the policyholder can borrow against the policy. While a permanent life insurance policy is a bit more comprehensive, it also comes at a much higher cost. Many people opt for a term life insurance policy because it’s far more affordable and still provides their family with the coverage they need.
If you have a car, you are required by law to have car insurance, unless you live in New Hampshire. Car insurance covers damages to your car. It can financially help you if you get into an accident that results in liability for someone else’s medical expenses. Now, the type of protection you have depends on the agreement between you and your car insurance company, but in general, these are standard coverages you may get:
The list above does not cover all of the protection you may get from your insurance, but those coverages are a good place to start. In general, car insurance is smart to have to provide your family with some financial protection in the event of an accident.
Depending on whether you rent or own your home, you may consider getting homeowner’s or renter’s insurance for some additional protection.
Homeowner’s insurance covers damages to your home, your property, and your assets. Depending on your mortgage lender, you may be required to get a policy. Even if you are not required to have a policy, it still is smart to have some level of coverage to protect your investment.
Homeowner’s insurance can help protect you and your family from medical costs if someone is injured on your property, cover living expenses if you and your family cannot stay in your home due to an accident, and even cover the cost of repairing other structural damage to your property, like fences.
If you rent, your landlord’s insurance will only cover certain damages to the property, but certain liabilities of renters and the coverage of your personal property are not normally covered by your landlord’s insurance.
While renter’s insurance typically isn’t required of renters, it’s a smart investment to make to protect your property and cover you and your family for any damages you may cause to the property while renting.
With so many policies you need, the cost of insurance can add up quickly. Luckily, though, there are a few ways that you can save money on insurance while still getting the coverage amount you need.
If you aren’t shopping around for insurance quotes, there’s no way to know if you are getting the best price possible for your coverage needs. Especially with how easy it is to shop for quotes, you should always search for a few quotes before settling on a policy.
When shopping around, you should first consider how much coverage is required of you to have (if you are required to have coverage at all) and how much coverage you need. You may choose to look around online for insurance quotes, work with an insurance agent, work with a broker, or get quotes from multiple or all of these options.
After you’ve gathered your quotes, take a look at the coverage you were quoted for and how much the coverage costs. While it may be tempting to choose the cheapest coverage, that may not always be the best option. Weigh the amount of coverage you need and the amount you can pay to find the best policy for you.
As you shop around for policies, be sure to check if you can bundle any of your insurances together to save money. A lot of the time, insurance providers will offer some type of discount when you opt to get multiple policies at once through the same provider.
For example, many companies offer both homeowner’s insurance and car insurance. Get a quote for both from the same company and see what type of discounts they may give you. It’s not a guarantee that you will save money if you bundle your policy. Be sure to compare the cost of bundling and getting policies separately.
Another way to save money on insurance is to consider your deductible. A deductible is how much you are responsible to pay out of pocket before an insurance policy kicks in and starts covering expenses.
Raising your deductible by even just a few hundred dollars can save you a lot of money on your monthly payments. Your deductible should not be more than what you could realistically afford to pay out of pocket, so be sure that you find a healthy balance between your deductible and your monthly payment.
You may be missing out on discounts on insurance policies if you don’t ask! For example, some car insurance companies may give you a discount on your policy if you have a good driving record and maintain good driving habits while you are insured. Risky driving behavior is sure to drive your policy costs up, though. Just remember that good habits will pay off in the long run.
Depending on your insurance provider, you may even be able to save on homeowner’s insurance for some good habits too! Doing things like adding smoke detectors to your house, installing security systems, or even not smoking in your house all are good habits that may be cause for a lower insurance rate.
Many companies will also offer discounts for people if they were or are in the military or even some career-based jobs, like teaching. Of course, discounts will always vary from company to company, so it’s always best to ask what discounts are available to see if any may apply to you.
Insurance is great to have to give your family some financial protection from the unexpected. And when you do the proper research ahead of time, insurance policies don’t have to be a huge cost to you and your family either. While insurance can be an overwhelming topic, hopefully this guide has made navigating the tricky waters a little easier.