Why Do I Need Insurance?
Insurance is a crucial element of financial planning because it protects individuals and their families from unexpected financial hardships. It helps safeguard assets, maintain financial stability, and reduce the burden of unplanned expenses, such as medical bills, disability, or damage to property.
By including insurance in a financial plan, people can help ensure their long-term goals remain achievable even in the face of life’s uncertainties, preserving both their wealth and peace of mind.
What Types of Insurance Do I Need?
The types of insurance you need depends on your personal circumstances, goals, and risk tolerance. Here’s a breakdown of the main types and where to find them:
Life Insurance
Protects your loved ones financially in the event of your passing. This is usually recommended if you have dependents or significant debts. You can purchase it from life insurance companies, financial advisors, or online providers.
Health Insurance
Covers medical expenses and is typically considered essential. You can get it through your employer, purchase a plan directly from an insurance provider, or explore options on the government marketplace (Healthcare.gov).
Disability Insurance
Replaces a portion of your income if you become unable to work due to illness or injury. It’s often available through employers, but individual policies can also be bought through private insurers.
Homeowners/Rental Insurance
Protects your home or belongings from damage, theft, or liability. Homeowners insurance is essential if you own a home, and renters insurance is recommended if you rent. These are available through many insurance companies.
Long Term Care Insurance
Covers the costs of long-term care services, which are generally not covered by health insurance. You can find this through private insurers or financial advisors who offer long-term care options.
Umbrella Insurance
Provides extra liability coverage beyond the limits of your homeowners, auto, or other policies, which can be especially useful if you have significant assets. Most major insurers offer umbrella policies.
