Did you know that the value of gross insurance premiums around the globe is more than $5.02 trillion? Take a second to wrap your head around that – $100 million would fit neatly on your standard pallet (like what groceries and bulk items are delivered on).

A trillion, however, is much, much more. After all, one trillion consists of 12 zeroes! However, the size of this industry isn’t what we are discussing here – it’s the reason that the insurance industry is so profitable.

The fact is, you – along with many others – have realized the value of having the right type of insurance. Now, we come to the question – what types of insurance do you really need? If you are ready to find out, keep reading.

1. Health Insurance

This is a pretty big one. Back in 2009, more than 60 percent of all personally filed bankruptcies were related (in some way) to health insurance costs.

If you are planning to purchase health insurance, there are a few things you need to consider. These are highlighted here.

Your Needs

Healthy, young, single individuals don’t need as much coverage as others. Young families, individuals with chronic health conditions and the elderly all require comprehensive coverage.

Are you planning to use your insurance often? If so, you are going to want to find a policy that offers low copays and deductibles.

Doctors

Each insurance plan comes with a list of what’s referred to as “in network” doctors. If you happen to go to an “out of network” doctor, the insurance won’t pay for your visit.

This means you need to ask if your doctor is covered by a policy you are considering purchasing. Otherwise, you may find the only option is to see another doctor that’s in the network.

The Cost

If you are like most people, you will only be able to afford so much insurance. You need to determine what you can afford before going shopping.

If you shop for insurance plans with higher deductibles and copays, then you can save money on your monthly premium.

2. Car Insurance

Virtually every state requires you have car insurance. If you have an older vehicle, then the bare minimum of coverage may be sufficient.

However, if you drive a new vehicle or one that is worth a lot of money, you need to consider purchasing enough coverage to protect against any issue, including theft.

The main types of car insurance available for you to purchase are listed here.

Liability Coverage

There are two forms of liability coverage. These include property damage liability and bodily injury liability. This coverage is designed to cover any damage to other people or their property. It does not cover you (the driver) or your passengers after being involved in a car accident.

Collision Coverage

If you want your insurance to cover the costs of damages to your vehicle, then collision insurance is a must. This pays for repairs regardless of if you were at fault, or not.

Personal Injury Protection (PIP) Coverage

While collision insurance covers damage to your vehicle, PIP coverage offers help with any injuries you or your passengers suffer.

Comprehensive Coverage

The collision insurance will only cover the damages that are done in an actual accident. However, if a tree falls and damages your vehicle, the collision insurance doesn’t cover it.

This is where comprehensive coverage comes it. It will take care of any damage your vehicle incurs.

Underinsured or Uninsured Motorists

If the person who runs into your vehicle does not have insurance, this coverage will pay for damages. It is beneficial to have, but not mandatory.

3. Life Insurance

While no one really wants to think about needing life insurance, it’s a fact of life. Without this coverage, you may leave your family with huge expenses when you pass.

The fact is – it costs money to die. Some of the related costs include mortuary fees, burial, cremation, and more. If you are the main money earner in the family, life insurance can not only cover these costs but also provide your family with money to help offset lost income.

If you are purchasing life insurance over 70, you will find there are often special policies designed to help you get the coverage you need, while being able to pay affordable rates.

If you are single and childless, you may not require a life insurance policy. However, everyone else should definitely consider making this investment.

4. Renter’s or Homeowner’s Insurance

Renter’s insurance will provide you coverage against the theft or damage of personal items in an apartment or rental house. In many cases, the cost of this coverage is well worth the investment.

If you own your home, insurance is essential. It provides protection for your most valuable asset – your home – against theft or damage. In some cases, however, this coverage alone doesn’t offer enough protection.

You may also need to purchase policies against fires, earthquakes, flooding and any other disaster that may not be covered by the standard plan.

5. Disability Insurance

Disability coverage is similar to life insurance. It provides reimbursement for any income lost during times when you can’t work.

With a third of all Americans being considered disabled at some point, having this type of coverage makes sense. This coverage can help to fill in the financial gams that may occur if you are totally, partially or temporarily disabled.

The best part is, this coverage is affordable. You don’t know what tomorrow brings, and this is an affordable way to ensure you are prepared.

What Types of Insurance Do You Have?

When it comes to the types of insurance you need, there are several options to keep in mind. If you want to protect yourself, and your family, you should make sure to purchase policies in all of the above categories.

It may be a good idea to work with an insurance agent, as they may be able to help you get significant discounts on all the policies you need. Once you have purchased your policies, be sure to keep a copy of them in a safe place, such as a fireproof safe.

To learn more about insurance coverage, as well as other essential topics, such as how often to get your teeth cleaned, visit our blog.