wavesInsurance is, in essence, a betting game: you’re betting that you will have a costly problem in the future (e.g., a car accident, hail damage, broken arm, etc.) that you will need financial resources to address. As you buy insurance, you probably aren’t assuming such a string of bad luck, but the basic concept of insurance is that you prepare for the worst. Insurance companies offer insurance for anything and everything from life insurance to mailing insurance. Depending on your perception of the world, you may feel the need for more insurance, while others find insurance a nuisance. But do you know what kind of insurance you actually need?

Homeowners Insurance

If you are a homeowner and you are paying a mortgage, your bank will require you to have insurance. What can you get with homeowners insurance? Usually, the following coverages are available:

  • Property damage (structure and contents),
  • Liability for injuries incurred on your property,
  • Damage you, your family, or your pets cause to others’ property.

Keep in mind that many homeowners insurance policies do not cover damage by catastrophic events such as earthquakes and flooding or cover all rebuilding costs. It typically doesn’t cover charges for counseling, even if the counseling is for a traumatic event that damaged your home. Homeowners will want to keep their homes in good repair well, because insurance won’t always cover damage that is a result of negligence.

Auto Insurance

It is against the law to drive without auto insurance, so you absolutely must get auto insurance. Coverage differs from one insurance company to another, but basic insurance should cover any damage that you cause to another’s car or person. The extent of benefits required for auto insurance differs from state to state. Arizona, for instance, requires a person to have at a minimum $15,000 bodily injury liability coverage and $30,000 property damage liability coverage. Auto insurance usually doesn’t cover personal property in the car that is stolen, and upgrades you’ve made to your car, uninsured drivers (you can add that to your coverage), and specialty cars or motorcycles.

Health Insurance

Anyone 26 years or younger can be a dependent on a parent’s insurance, but after this age a person is required to purchase insurance or be fined. Health insurance is available with a variety of perks depending on your health situation. Many employers offer their employees significantly discounted health insurance.

Life Insurance

Life insurance is a great way to take care of your loved ones after you are gone. Life insurance is a means to help your family by providing for funeral costs, replacing lost income, and providing them a potentially large sum for living expenses. This kind of insurance is particularly important for the breadwinner of the family.

Other Types of Insurance

  • Depending on your needs you may want to look into other types of insurance. Here are a few to consider:
  • Disability Insurance – You can purchase short-term and long-term insurance that can help with income replacement in the event you can no longer work.
  • Umbrella Insurance – Essentially, this is insurance for your insurance.
  • Property and Casualty Insurance – For your valuable possessions and vehicles.
  • Liability Insurance – Pays for legal fees and damages if you hurt someone or cause injury due to negligence.
  • Long-term Care – If you or your loved one feels that long-term care may be required, you might look into long-term care insurance. Purchasing this kind of insurance can be great idea between the ages of 50-65 years old.

These are the essential or required types of insurance that most people should have. Alpha Fiduciary is a trusted financial advisor with offices in the Scottsdale and Chicago areas that can help you find insurance that fits your needs and your lifestyle.

 

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