What Type of Insurance Does My Family Need?

15 Feb

by: Remie Longbrake | published: Feb 15, 2021

Part of your financial plan should include protecting your assets, including your possessions, as well as your income, loved ones, and health-related financial concerns. Insurance isn't very exciting, and it can certainly be expensive. But when you need it, you’ll be glad you have it. Unfortunately, there’s no single policy that will give you all the coverage you need. Take inventory of your insurance coverage. Do you have these 5 important policies? 

Life Insurance

Life insurance protects those people who depend on you financially if you die unexpectedly. Consider the hardships on your loved ones if you should happen to pass away prematurely. 

How do you determine how much life insurance you should get? 

Consider these topics: 

  • Replacing incomes
  • How much money will be needed
  • How long will the money be needed
  • What are the cost of funeral expenses
  • What debts will be owed and how will those be paid. 

No one likes to think about these things. However, if you deal with it now, it's something your family doesn't have to deal with later.

Health Insurance 

Health insurance is expensive, but health care is expensive too, really expensive. A simple trip to the doctor can easily be several hundred dollars. A routine surgery that only results in being in the hospital for a couple of hours can be over $10,000. 

Health insurance costs are a burden, but the cost of a genuine medical issue can be catastrophic. 

If this isn't something you can get through your employer, be prepared to do some legwork to find a policy that’s right for you. 

Long-Term Disability Insurance 

This insurance replaces a portion of your lost income if you become unable to work. The cost depends on the amount of income that you wish to replace, your age, health, the length, and the limits of coverage. Policies will also differ regarding what they consider to be a “disability.” 

This coverage can also be quite expensive. Hopefully, you can also get this through your employer. If not, sit down with your life or health insurance agent to go over the details of this important insurance. 

Long-Term Care Insurance

This is for those later in years, who will need help with taking care of themselves, without spending down personal assets. Usually there are stipulations on what long--term care (LTC) will start coverage, such as two needing help with more then two of six aids to daily living (ADL's), like dressing or bathing yourself or managing prescriptions effectively. LTC usually will include care in a skilled living community, with those cost $5,000 or more per month, this is a great benefit to have.

Essentially what LTC can help with having quality care without spending your own assets down in order to quality for care in these situations. Alternatives would be depending on social security, which does not provide much financial help, or joining a state Medicaid program, which usually requires selling down all personal assets.

Homeowners Insurance 

If you still owe money on your home, your lender requires homeowners insurance. If you don't owe money on your home, you should still carry this type of financial protection. Consider how many thousands of dollars your house and the contents would cost to replace. 

The price of homeowners insurance is quite small compared to the amount of coverage you're getting. 

Besides covering the structure of the house and its contents, some policies will even cover putting you up in a hotel until your house is repaired. Any injuries that occur to friends and strangers are also covered under your house policy. 

Consider what you need; there are a lot of options for benefits, limits, and price. 

Automobile Insurance 

Nearly all states require automobile insurance to varying degrees (New Hampshire is the exception). Everyone should have coverage, even if you drive a 1975 Chevy Nova that has been paid off for years. Even in that case, you’re still financially responsible for the damage you cause to other vehicles and property.

Without automobile insurance, you might face a lawsuit that could potentially cost you everything you own. Ensure you have all the coverage you need, not only for your own vehicle, but to cover your liability as well.

Liability Insurance

What would happen if you were at fault for an accident? With court costs upwards of 1 million, there's a good chance you will not have enough coverage on a standard auto or home policy. Have a teen driver, just as much as important, or even having a business. All could be lost without this special coverage. This is something to highly consider to protect you and your loved ones from financial disaster.

In closing

Insurance isn't exciting or sexy, but it's a necessity. When looking at new policies, shop around because prices and coverage can differ widely from one company to the next. 

One tip to save some money: 

Get a policy with a higher deductible. The more you have to pay before the insurance kicks-in, the less that insurance coverage will cost you. 

Do your homework and find an insurance professional you can trust. Don't just focus on what insurance costs you; think of what it will cost you if you don't have it.

Let us help you with an honest discussion regarding your financial opportunities.

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