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5 Insurance policies: Protecting your most important assets is an important step in creating a solid personal financial plan, and the right insurance policies will help protect your earning power and your assets. In this article, we discuss five principles that you should not do without.
1. Long Term Disability Insurance
The prospect of long-term disability (LTD) is so dire that some people choose to ignore it. Instead, choose a disability policy that provides enough coverage to enjoy your current lifestyle even if you are no longer able to work.
Long-term disability provides a cash benefit equal to a portion (eg 50% or 60%) of the insured’s salary for the covered disability. To receive benefits, disability must occur after the policy is issued and then, usually after a waiting period. Medical information, often certified by a doctor, must be provided to the insurer for review.
Most long-term disability contracts classify the disability as self-employment or any occupation. Self-employment means that the insured cannot perform similar work due to his regular work or disability. Any occupation means that the insured cannot do any work for which he is qualified due to disability.
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Most long-term disability contracts classify the disability as self-employment or any occupation. Self-employment means that the insured cannot perform similar work due to his regular work or disability. Any occupation means that the insured cannot do any work for which he is qualified due to disability.
While long-term disability insurance and workers’ compensation insurance cover disability, long-term disability insurance is not limited to disability or injuries that occur on the job.
2. Life insurance
Life insurance protects people who are financially dependent on you. If your parents, spouse, children or other loved ones face financial difficulties when you die, life insurance should be high on your list of required insurance policies. Think about how much you earn each year (and how many years you plan to be employed) and buy a policy that will replace that income in the event of your untimely death. Also include funeral expenses, as unexpected expenses are a burden for many families.
3. Health insurance
The rising cost of medical care is reason enough to make health insurance a must. Even a simple visit to a general practitioner can result in a hefty bill. A more serious injury resulting in a hospital stay can result in a higher bill than a week’s stay at a luxury resort. Injuries that require surgery can quickly add up to five-figure costs. While the cost of health insurance is a financial burden for almost everyone, the potential cost of not having coverage is greater
4. Household insurance
Replacing your home is an expensive affair. The right home insurance can make this process easier. When shopping for a policy, look for one that covers structural and contents replacement, in addition to living expenses while your home is being repaired.
Remember that remodeling costs should not include the cost of the land since you own it. Depending on the age of your home and the amenities it has, it may cost you less or more than what it would cost to replace it. To get an accurate estimate, find out what local builders charge per square foot and multiply that number by the amount of space you need to convert. Don’t forget to factor in the cost of upgrades and special features. Also, make sure the policy covers the cost of any liability damage to your property.
Renter’s Insurance
Renters also need peace of mind that they will be covered in case of damage. Fortunately, renters insurance is a type of property insurance for people who rent or lease property. This insurance provides coverage for covered damages, personal belongings, liabilities and other living expenses.
There are two types of property coverage for a property: home owner’s insurance and renter’s insurance. However, home insurance does not cover renters’ personal possessions. This is why it is important for renters to have landlord insurance to protect their property.
Although renters insurance is different from homeowners insurance, it has the same elements: coverage A for dwelling, B for other structures, C for personal property, D for additional living expenses to cover medical expenses.
Since renters are not responsible for home or other structure insurance, A and B coverages are often set at $0.
Coverage C covers the tenant’s personal property. Cover D provides additional cost of living benefits in case of loss. For example, if a tenant is evicted from their home due to a fire, Coverage D provides coverage for living expenses elsewhere, such as hotel and meal expenses. Insurance E covers injuries and property damage caused by the insured, and insurance F covers medical expenses for guests of tenants of the approved building.
5. Automobile Insurance
A proper level of car insurance is required by law in most places. Even if you don’t need it and you’re driving an old mess that you’ve been paying for for years, car insurance is something you shouldn’t skimp on. You should not If you are involved in an accident and someone is injured or property is damaged, you may be sued, which could cost you everything. Accidents happen quickly and the consequences are often tragic. Without car insurance or buying the minimum coverage you need, you save little money and put everything you own at risk.
