Life is full of uncertainties. That’s why insurance exists. For a monthly premium and annual deductible, insurance companies will help protect you against financial loss in a number of situations. If you drive a car, own a home, rent an apartment or travel, here’s what you need to know about different types of insurance.
What Types of Insurance Do You Need?
This is one of the largest categories of insurance because law mandates that almost all drivers have it. Of course, millions of people drive uninsured and put themselves at substantial risk.
– Liability auto insurance – All drivers must provide assurance that they have the financial wherewithal should the be found at fault in an automobile accident. In the overwhelmingly vast majority of cases that means drivers need liability auto insurance that meets minimum requirements.
Liability insurance offers basic coverage in the event you cause an accident that results in injury or property damage. However, the policy only covers expenses incurred by the other party, not your own damage or injuries.
– Comprehensive auto insurance – Comprehensive auto insurance is a step up from liability coverage. It provides coverage for your own vehicle and injuries if you’re in an accident. Comprehensive insurance also pays for damage that’s done by Mother Nature, vandals and thieves. The deductible is higher than liability auto insurance, but you could save a lot more money in the long run.
– SR22 auto insurance – If you’ve been caught driving without insurance, were charged with a DUI or have had your license revoked, you’ll probably be required to carry SR22 auto insurance. It’s essentially a document filed with the state that verifies you are adequately covered. It differs from the insurance card you need when you hear the dreaded “license, title and insurance please.” This needs to be filed before your license is reinstated.
A home is the single largest investment for most people. Homeowners insurance is designed to protect that investment. If you have a mortgage, your lender will likely require that you have a certain level of homeowners insurance until the loan is paid off.
Homeowners insurance provides three primary benefits:
- · Covers the cost of repairs for the property/structure – Should your home be damaged by a storm, fire or another person, repairs will be covered by the insurance company.
- · Provides reimbursement for damaged or stolen possessions – If the things inside your home are damaged or stolen, homeowners insurance will cover the value. Some companies will cover the cost to actually replace the items.
- · Provides personal liability protection – Should someone be injured on your property and sue, personal liability protection will pay for the legal and medical bills.
The cost of homeowners insurance varies. The value of the home and the possessions inside are carefully considered. Location also has a huge impact on how much home insurance costs. For example, most Florida homeowners insurance includes coverage for potential hurricane damage from wind, downed trees, and the like. However, floods and related damages need additional coverage.
Other types of home insurance you may want to consider include:
- · Mold insurance
- · Earthquake insurance
- · Windstorm insurance
- · Water backup coverage
If you don’t own the home you live in, you can still protect your belongings with renters insurance. This type of policy provides coverage in the event of a fire, burglary or certain natural disasters.
However, how you will be reimbursed depends on the type of coverage you choose. You can opt for:
– Actual Cash Value – The insurance company will cut you a check for how much the item(s) were valued at (including depreciation) when they were damaged or stolen.
– Replacement Cost – With replacement cost, the insurance company will provide enough to cover the cost of replacing the item(s). This option is more expensive, since the reimbursement is more substantial.
Keep in mind a rider or scheduled personal property endorsement may be needed for items that exceed personal property limits.
As the name suggests, travelers insurance provides added protection while you’re traveling. Transportation, accommodations and entertainment can be extremely expensive. One glitch in your travel plans can be extremely costly if you don’t plan ahead.
Travel insurance can be customized, but there are two main categories. Travel interruption insurance will provide reimbursement for nonrefundable expenses in the event outside forces cause delays or interruptions.
Travel cancellation insurance provides the same coverage if things are cancelled outright. Common reasons trips are interrupted or cancelled include medical emergencies, bad weather, acts of terrorism, natural disaster and unexpected work conflicts.
Bottom line? Life sure has loads of surprises, some good, others…not so much. You cannot avoid them, but you can pre-plan to mitigate the financial burden that may be attached.
Identity Magazine is all about empowering women to get all A’s in the game of life – Accept. Appreciate. Achieve.™ Every contributor and expert answer the Identity 5 questions in keeping with our theme. Their answers can be random and in the moment or they can be aligned with the above article. As a team, we hope to inspire and motivate ourselves and inspire you to get all A’s.
1. What have you accepted within your life, physically and/or mentally? What are you still working on accepting?
That we have to all appreciate the little things and to not take anything for granted.
2. What have you learn to appreciate about yourself and/or within your life, physically and mentally? What are you still working on to appreciate within yourself and/or life?
I’m blessed to have loving family and friends in my life.
3. What is one of your most rewarding achievements in life? And what makes YOU most proud? Any goals and dreams that you still have?
Graduating from Arizona State University in 2013
4. We all have imperfections, so we think. The truth—we are all perfectly imperfect. What imperfections and quirks create who you are—your Identity?
Nobody’s perfect and it’s been hard to accept it. I’ve learned to embrace my curly hair, my curves and my quirky personality.
5. “I Love My…” is an outlet for you to express and appreciate all the positive traits that make you…well… YOU! Sharing what you love about yourself will make you smile, feel empowered, and uplift your spirit and soul. (we assure you!) Identity challenges you to complete the phrase “I Love My…?”
I love my unwavering intensity. Everything I do is 100 percent.
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