Consider Protecting Yourself and Your Family With The Proper Insurance

by Hank Coleman

We spend all of our life accumulating wealth and money, but it can disappear in a flash if you are not protected. It takes a lot of hard work to create personal wealth. Therefore, it is important that you acquire the necessary insurance to protect you and your family from any major financial loss. Insurance ensures that you will be paid in case of an unforeseen financial setback in return for paying a premium. And, in some cases, it is a price and peace of mind that is well worth the expense. But, what kind of insurance do you need?

Homeowner’s Protection. A homeowner’s insurance policy covers both your possessions and the structure where you reside against loss or damage. Of course, you will want to make sure that you are adequately insured and that you can afford the coverage. For example, f you live in an area that is prone to earthquakes, you will have to add this type of protection as well. If you are working within a limited budget, you may have to choose a higher deductible until you can afford more protection. If you have a mortgage, your bank or mortgage company will insist on adequate coverage as part of the loan agreement.

Renter’s Insurance. If you live in a rental, you should buy renters insurance to cover the contents of your apartment or home from theft or fire. Do not depend on your landlord’s insurance to cover you. It only insures the building against theft or fire, not what is contained in the building itself. Renter’s insurance is a must and only costs a few dollars per month.

Home Warranty Protection. If you own a new home, a homeowner’s warranty is good protection. It covers you should you have a major system breakdown and must pay to repair the air conditioning, wiring, plumbing or water heater. Usually, such protection only lasts one year with the option of renewal. There are other companies that offer aftermarket home warranties as well. They may be worth the cost if you have a large item break.

Auto Insurance. Any car owners know that auto insurance is also “must-have” protection. You may be able to include it in an umbrella policy with your homeowner’s policy for increased liability coverage at a reasonable rate. With a decent size emergency fund or savings account in place, you may feel a little bit more confident about opting for a higher deductible on either your homeowner’s or auto insurance too in order to save a lot of money on the cost of your premiums.

Health Protection. Medical insurance pays for most health costs related to doctor’s visits, hospital, and prescription drug expenses. You should not go without health coverage. You can develop a substantial amount of debt if you do not carry any health coverage. Also, any defaults or late payments you incur can significantly affect your credit score and make it harder for you to secure other loans if needed.

An FSA Account. Health protection is lower if you opt for a group plan at work because the risk is spread over a greater number of individuals. Take advantage of your company’s health plan even if you must contribute to it out of your salary. If your employer offers flexible spending account (FSA), sign up for it. With such an FSA account, you can build up pretax savings to cover any deductibles as well as any medical and prescription expenses not covered by your insurance. If your employer does not have such a healthcare plan in place, make sure that your emergency fund can cover these kinds of expenses.

Talk to your insurance agent and see where you can reduce expenses but still maintain optimum coverage. After spending all of our working lives saving, investing, and accumulating wealth, it can be gone in a flash if you are not protected by insurance. It takes a lot of hard work to increase your net worth and save adequately for retirement. Therefore, it is important that you acquire the necessary insurance to protect you and your family from any major financial losses. Keep your wealth protected for the sake of your family.

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{ 1 comment… read it below or add one }

jason June 17, 2010 at 5:24 am

i learned the hard way a few years back that its not worth the risk to go with out insurance

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