No matter how careful you are in life, there are certain things that you just can’t control. This is the reason why people invest in affordable and comprehensive insurance plans to protect themselves and their families. However, there are still a large number of people who have a different opinion and think that insurance is just a plain waste of money.
You may have your reasons to not invest in an insurance plan. However, if you will think about the concept with an open mind, then you can clearly see the merit. For better understanding, let’s take a look at some of the most popular and most recommended insurance coverages:
1. Health Insurance
Health insurance is easily one of the most popular forms of personal insurance, and for a good reason. This is because good healthcare has become more expensive than ever and there are a number of studies that project a dramatic rise in chronic disease costs, and the increased risk of acquiring these diseases in the first place.
Some people argue that they don’t need health insurance if they are eligible for coverage under the Affordable Care Act or if they are getting it from their employer. However, the problem with these options that they aren’t usually enough. Even if the coverage amount is high, many of the life-threatening diseases like cancer, AIDS, etc. are rarely covered.
So, if you want to protect yourself from all kinds of health-related risks, then you must invest in a comprehensive insurance plan that offers maximum coverage at an affordable premium. Sure, everything is individual, this is why there are so many different insurance plans for different age groups. For example, medical alerts could be covered by some Medicaid programs. And at the same point hearing aids are rarely included. So you need to have clear priorities when you’re choosing your insurance.
2. Personality Liability Insurance
Personal liability refers to bodily injury or property damage caused by you, a family member, or even your pet as explained here. So, personal liability insurance covers the legal fees, property damage payments, medical payments, etc.
There are many reasons why you need personal liability insurance, but the most important ones are:
Stakes are High
The U.S. is known as the most litigious society in the world. Here, the people are sued for even saying seemingly innocent things. So, there is a high chance that may face a lawsuit in your life yourself.
Let’s say you are a responsible individual who takes all the precautions to avoid unnecessary lawsuits, but what about your pets or children? Even if it’s your four-legged friend who damages your neighbor’s yard or your son who accidentally hits someone with a baseball to cause a serious injury, it’s ultimately you will have to face legal action and pay the fines. In events like these, personal liability insurance can really come in handy.
Claims can be Expensive
You won’t believe how expensive the smallest of personal liability cases can be. For instance, an injury claim can easily set you back by as much as $15,000 depending on the nature of the injury. Covering property damage isn’t easy either and can cost you $5,000 to $7,500. This is when the lawyer fees aren’t even added to the total cost.
Your Wealth can Make You an Easy Target
If you are earning an honest living and doing well for yourself, then you do deserve a bigger house, a luxurious car, etc. However, these purchases can often attract unwanted attention and make you an easy target for a lawsuit.
As you can see, there are many compelling reasons to get personal liability insurance if you don’t have it already.
3. Auto Insurance
In the majority of states, you are required to get auto insurance for your vehicle as per the law. Failing to do so can attract a fine of up to $1,000 and can easily result in the suspension of your driving license. However, you will be surprised to know you that it won’t be the fine that will give you a reason to worry- it will be the actual damage to your car. This is because you depend on your vehicle for getting around the city and commuting to work, and if it’s unavailable, then many of your routine activities can be affected.
If your car is damaged in an accident and you have no insurance cover, then you have to bear all the repairing costs yourself which can be huge. Moreover, your financial burden can increase further if someone is injured in the accident. For instance, if the person is another driver or a pedestrian, then they can sue you. However, if you have auto insurance, then it can cover most of the medical and legal expenses.
One of the best things about auto insurance is that it’s actually quite affordable which is around $1,400 per year. However, if even this is too high for you, then you can lower auto insurance rates by taking multiple steps that include removing unnecessary coverage, increasing deductibles, and comparing other options.
4. Life Insurance
You need life insurance if you love your family, plain and simple. This is because it’s designed to provide financial support to your family if in an unfortunate event you have to tell them an early goodbye.
Life insurance is usually available in two formats:
- Whole life: As the name suggests, in this type of life insurance, you pay a fixed premium every year till you pass away, upon which the lump sum is transferred to the nominee i.e. your spouse.
- Term life: In this, you have to pay a premium for a certain number of years i.e. the insurance term, although the premium itself is a lot cheaper than whole life insurance. That said, the financial benefits are extended to your family only if you pass away during this term, but if you survive, then the cover ceases and nothing is payable.
Both types of insurance plans have their benefits and you can make your choice by considering factors like your age, savings, etc. Just make sure that the coverage amount is sufficient and includes your funeral expenses, tuition fees for your children, medical emergencies, etc.
There is no denying that life is unpredictable. You can’t be too careful, and you can’t control your destiny. However, what you can do is invest your money smartly so that when times are tough, the stress is minimized at least as far as the finances are concerned.
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