WHY DO I NEED INSURANCE?

Insuring your family properly is perhaps one of the most important things that you will do in your lifetime. Having the proper insurance coverage means that no matter what unexpected event life throws your way, your family will know that everything will be taken care of. It is an essential part of providing for your family, and should be seen as an investment as opposed to just another bill.

HOW MUCH DOES IT COST?

Many people complain about the cost of insurance, but of recent years the costs for all types of insurance have actually been dropping. This means, for you as the consumer, that there has never been a better time to make sure that all of your affairs are in order and that every possession and every person in your life is protected to the fullest extent.

WHAT TYPES OF COVERAGE DOES THE AVERAGE PERSON NEED?

Insurance is one investment that no matter what income level you are at is extremely important to have. When considering insurance coverage be sure to look at coverage in each of the following categories:

1. Auto Insurance – Insuring your vehicle is important and legally required. This not only covers you and your vehicle but covers any other vehicle that you may come into contact with. This is important not only to avoid having to pay a large repair bill, but also because it can help you cover your medical expenses, plus help you if you get into an accident with an uninsured motorist.
2. Medical/Health Insurance – Having medical insurance obviously helps reduce the amount that you have to pay for doctors, medications and other necessary medical treatments, but were you also aware that having medical insurance also reduces your overall bill. Insurance companies set limits on what a doctor or hospital can charge you per service; these are their reasonable and customary charges. So let’s say that a doctor charges you $150.00 for an office visit, but the R&C charge for this service is $75.00. The insurance then pays its percent off the $75 and you pay your percentage off the $75 and the insurance company disallows the rest, which means the overall bill was just cut in half. If you don’t have medical insurance, you would be expected to pay out of pocket the full $150 charge that the doctor asks for. Reasonable and customary charges are only enforced by an insurance provider.
3. Life Insurance – A basic term life policy is not very expensive, however it can help your family to get back on its feet if something happens to you. It can also help with your final expenses which can cost upward of $5,000 and can put great financial strain on your family and Social Security will only send your family about $250 to bury you with. That is not enough to cover even the most modest of arrangements. Be sure to leave your family with money that they will need to take care of things in your absence. These premiums are low, and well worth the investment.
4. Homeowners Insurance – Homeowner’s insurance policies cover your biggest investment, your home. Required by most mortgage companies, this insurance policy will cover the cost of your home and repairs, in case of fire or other structural damage. This type of policy also covers the contents in your home in case of damage or theft. A little more costly than some other insurance policies, this is an absolute necessity to have. It is advisable to carry this type of coverage continuously on your residence even after you no longer have a mortgage.
5. Renters Insurance – This type of insurance policy is for people who are renting their home or apartment. Although, your landlord most likely has some type of insurance already, more than likely it will not cover the contents of the dwelling. These items need to be insured by you. You may think that you don’t have anything worth all that much, however just the replacement cost of general items like dishes, appliances, furnishings and clothing can add up quickly. Take the time to do an inventory and you may be surprised to find that you actually have more stuff than you think. Renters insurance is very reasonable, and will help you not only replace your belongings, but will also provide you with money for a temporary place to stay.

Cutting back is on everyone’s minds, however be sure not to cut back on your insurance. If money is getting tight, then cut back in other areas of your life, but be sure to keep your insurance premiums up to date. The less money you have the more you need to be covered for the just in case.