Insurance is like a life jacket. It’s a bit of a nuisance when you don’t need it, but when you do need it, you’re more than thankful to have it.
Without it, you could be one car wreck, illness or house fire away from drowning—not in the ocean, but in debt.Making sure you have the right insurance coverage is critical for your overall financial health.
That’s why it’s important to know what kinds of coverage are right for you and your family right now, and how to determine how much coverage is enough. But most people may want to consider these 7 types of insurance.

1. Health Insurance

Health Insurance
Health Insurance

Nothing’s more important than your health. if you don’t have health insurance and something goes wrong, it’s not just your money at risk — it’s your life.Health insurance is a must for both preventive care and treatment for illnesses.

Medical debt contributes to nearly half of all bankruptcies in America according to the Kaiser Family Foundation. The high cost of medical insurance isn’t an excuse to go without coverage—even if you don’t go to the doctor often. One option is a high-deductible health insurance plan combined with a Health Savings Account (HSA). With a high-deductible plan, you’re responsible for more of your up-front healthcare costs, but you’ll pay a lower monthly premium.

2. Homeowners/Renters Insurance

HomeownersRenters Insurance
HomeownersRenters Insurance

Your home is the biggest investment you’ll ever make. Renters insurance offers many similar benefits to homeowners insurance. One main distinction between homeowners insurance and renters insurance is that the homeowners policy typically does not cover damage to or loss of the renter’s possessions, but the renters policy does.Having the best home insurance will protect you if your home becomes damaged due to flooding, fire, severe weather, or other factors. If you own a home, you need homeowners insurance. If you rent your place, you need renters insurance.
Homeowners and renters insurance policies contain two different components: Liability coverage and property coverage. Liability coverage pays for costs associated with an injury on your property. If someone slips and falls on your steps, your liability policy will pay for your defense if they sue you. It will also pay for any damages the injured person is awarded. Liability coverage also pays out if your dog bites someone and you’re sued.
Be sure your homeowners policy includes extended dwelling coverage. Extended dwelling coverage adds an extra layer of protection above your policy limits.Homeowners insurance covers the cost to repair or replace parts of your home or your belongings in the event of a covered loss.
You’ll need to choose how much liability protection and property coverage you want to buy. The more coverage you have, the higher the premiums. You’ll also need to choose your deductible. As is typical for insurance, a lower deductible means higher premiums, while a higher deductible means you pay more out of pocket if something happens, but your regular premiums are lower.

3. Umbrella Policy

Umbrella Policy
Umbrella Policy

An umbrella policy is a type of insurance, provides coverage above and beyond the liability protections provided by all other insurance policies,that adds an extra layer of protection for you and your assets when you need coverage that exceeds the limits of your homeowners or auto insurance. Buying an umbrella policy can be more affordable than significantly increasing coverage limits on your homeowners and auto insurance.
In fact, we recommends an umbrella policy for anyone with a net worth of $500,000 or more. For a few hundred dollars a year, an umbrella policy can increase your liability coverage from the standard $500,000 to $1.5 million.

4. Auto Insurance

Auto Insurance
Auto Insurance

Most people are familiar with auto insurance, as you’re required by law to have it in order to drive. In fact, driving with no insurance or registering a vehicle without insurance can lead to criminal charges.
There are several options to choose from when it comes to auto insurance,You need to at least have the minimum auto insurance required by your state. You should also have comprehensive coverage unless your car is very inexpensive and you could easily replace it. so there’s no reason to go without it:
Liability coverage. Most states require you to carry a minimum amount of coverage. If you cause an accident, your liability insurance pays for costs of defending you against a lawsuit, and also pays out compensation as part of a settlement or awarded damages in a lawsuit. Liability policies don’t pay for losses you incur when you damage your vehicle — they pay for losses you cause others to incur.
Collision coverage. This covers the cost to repair or replace your car if it’s damaged or destroyed in a wreck.
Comprehensive coverage. This level of insurance covers your losses that aren’t caused by a wreck such as theft, vandalism, flood, fire and hail.
The amount of coverage you have, along with your deductible, determines your premiums. Insurers also consider your age, gender, driving record, marital status, and other factors to assess whether you’re a risky driver or not. Even the color and make of your vehicle can affect premium costs. If you’re considered to be a high-risk driver, you will pay more for coverage.

5. Long-Term Disability Insurance

Long-Term Disability Insurance
Long-Term Disability Insurance

Disability insurance is intended to replace your income if something happens that makes you unable to work. There are both long- and short-term disability policies,short-term disability insurance designed to fill in income gaps caused by an illness or injury that keeps you out of work for three to six months. That’s insurance you can skip—especially when you have a fully funded emergency fund to cover your needs. Long-term disability insurance protects you from loss of income if you are unable to work for a long period of time due to an illness or injury.
Those odds are too high for you to skimp on long-term disability insurance. If you’re in your prime wage-earning years, a permanent disability could potentially derail your dreams of home ownership or paying for your kid’s college.
If you shop for a disability policy, look for coverage that has a broad definition of disabled and that replaces a big enough portion of income, with a short waiting period, if any. Going without disability insurance can put you into a difficult situation. While you can apply for Social Security Disability benefits, these benefits are available for long-term disabilities only and can be very difficult to qualify for. If you can’t qualify for Social Security benefits and haven’t purchased disability insurance, you may have no income at all if you can’t work.

6. Term Life Insurance

Term Life Insurance
Term Life Insurance

When it comes to planning for your financial future, no decision is right for everyone. There’s no way to know whether what works for one family will work for another.One exception to this rule is life insurance.Make this a priority. Talk to an independent insurance agent about term life insurance today. It’s affordable and will provide priceless security for your family. When you shop for life insurance, don’t forget, term life insurance is always a much better deal than whole life insurance.
This kind of event is always a bit of a wake-up call. There’s just no telling when something unexpected could happen. Having a comfortable amount of life insurance can help to ease some of the financial stress during an already difficult time of life.
Almost all married couples and young families should consider purchasing life insurance. The last thing you want your spouse, partner, or kids to face in the event of a tragedy is an immediate financial hardship.

7. Long-Term Care Insurance

Long-Term Care Insurance
Long-Term Care Insurance

Long-term care insurance covers a range of services like nursing home care and in-home help with basic personal tasks like bathing, grooming and eating. Usually, long-term care refers to any ongoing assistance for those who have a chronic illness or disability. It’s expensive, and long-term care costs are not generally covered by Medicare.
Long-term care insurance has its fans and foes — and for good reason. Policies can be expensive, especially if you purchase coverage when you’re older, and no crystal ball can predict how much coverage you’ll actually need, or if you’ll need it at all. Before making a decision for or against, you should know a few basic details.
So who really needs long-term care? To protect your retirement savings from the expenses of long-term care, get long-term care coverage no later than age 60.
Some employers offer long term care insurance their employees at a group rate. You may want to consider this if you’re employer offers it. If you’re planning to self-insure, it may be a good idea to work with a financial planner who can help you evaluate your coverage needs and find a provider that can meet them without breaking the bank.