When it comes to buying insurance, there are so many options on the market today that you might not know what’s necessary and what’s superfluous.
It’s important to be covered, but you can also be too covered. Paying for too much insurance takes money away from other areas, such as your emergency fund and your retirement savings.
When it comes to insurance, there are basically five types that everyone needs.

Health Insurance
This is the big one. In 2009, over 60 percent of all personal bankruptcies were related to health insurance costs.
When purchasing health insurance, consider the following:
Young and healthy single people require less coverage than those with young families, the elderly, or those with chronic health issues.
One of the first questions you should ask about a plan is if it allows you to keep your current physician and the quality of the healthcare providers included in the policy.
You can obviously only afford so much, so know what you can afford. Shopping for plans with higher copays and deductibles will save you money on your premium.
Visit our Health Insurance page for more details.

Car Insurance
Not only will you want car insurance, but it is mandatory by law that you have it.
For those with an older car, no more than the bare minimum may be required.
However, if you have a newer car or a car with a high value, you will also want to insure it against theft.
Visit our Motor Insurance page for more details.

Householder’s Insurance
Householder’s insurance is absolutely essential. It protects your most valuable asset against damage and theft.
It also covers you against damage or theft of personal items in an apartment. It is well worth the peace of mind that it provides.
However, sometimes Householder’s insurance isn’t enough to fully protect your home.
Ask your insurance agent if you need additional insurance against flooding, earthquakes, fires and other disasters that might not be covered under standard plans.
Visit our Householder’s Insurance page for more details.

Personal Accident Insurance
Personal Accident insurance reimburses you for income lost during periods of time that you are not able to work.
As accidents can happen to anyone, anytime, anywhere, having this insurance makes good financial sense.
Personal Accident insurance can cover permanent, temporary, partial and total disability.
No one knows what tomorrow might bring and personal accident insurance is relatively cheap – far less than the cost of not having it if something goes wrong.
Visit our Personal Accident Insurance page for more details.

Life Insurance
No one likes to think about it, but life insurance is an essential component of protecting your family in the event that you pass before your time.
There are costs associated with dying, such as burial and mortuary fees. Further, if you are the primary breadwinner, life insurance will help your family to offset the lost income.
The latter is the main reason that people get life insurance. The single and childless might not need life insurance, but everyone else should invest in a policy now.

“The 5 Basic Insurance Policies Everyone Should Have” was written by Nicholas Pell.