A Guide to the Different Types of Insurances

Insurance only works if you have the right policies in place – before disaster strikes. However, with so many types of insurance, it can get confusing as to what you need and how much your policy limits should cover. 

Below is a simple guide to help you weed through the different types of insurance and which ones are right for you. 

Health Insurance 

Health insurance pays for the cost of medical care. Most people get their health insurance from their employer, though some have to shop through the individual market. If you’re young and healthy, a high-deductible health policy is most affordable. But if you see the doctor often, it’s best to choose a plan with comprehensive coverage, higher premiums and lower deductibles. 

Life Insurance 

Life insurance pays out money to your beneficiaries when you die. If anyone relies on your income (spouse, children), you need life insurance. The cost of these policies vary depending on the death benefit, your age, your health and other risk factors. The type you buy also matters. Term policies provide insurance for a specific amount of time, whereas whole life insurance builds cash. 

Homeowners Insurance 

If you own a home, your mortgage lender requires you to have homeowners insurance. Home policies contain two parts: liability coverage and property coverage. Liability coverage pays for damages associated with an injury on your property. Property coverage pays out if something happens to your home or possessions.

Auto Insurance 

You’re required by law to carry car insurance. Each state has different requirements. Typically, you need liability coverage that pays out if you injure someone in an accident or damage someone’s property. You may also be required to buy personal injury protection and uninsured/underinsured motor coverage. 

Flood Insurance 

Flood insurance is not included with your standard homeowners policy. If you need flood insurance, you can purchase it from the National Flood Insurance Program or through a private insurer like Soden Agency. Those who live in flood zones are required to have flood insurance, though it can be useful for other properties as well. 

Umbrella Insurance 

You may decide that you want umbrella insurance for added coverage. Buying an umbrella policy can be more affordable than increasing your coverage limits on home and auto. Not only does umbrella insurance give you added protection, but also it keeps your assets and wages safe if you are sued. 

Summary 

These are the basic types of insurance that most people should have. If you have special circumstances, such as running a home business, you may benefit from additional insurance as well. To discuss your individual needs and the coverage options that are right for you, contact Soden Agency today.