When a family loses their breadwinner untimely, or when someone crashes their brand new car, it is heart-wrenching. What's worse is that they can't do anything about it. That's where insurance comes up to save the day. The majority of people consider insurance as a total waste of money. This article illustrates the importance of insurance and the top three types of insurance everyone must-have.
Why Do You Need Insurance?
You have worked very hard over the years to make your family financially stable and fundamentally strong. Working hard or not is in our control. What’s not in our control is any unforeseen and unprecedented situation that may arise to shake our financially strong setup foot. You need insurance to cushion your finances from sudden abrupt falls and boost them up with double speed. Here are our top three insurances:
1. Life Insurance: Live Today & Plan Your Tomorrow.
The thought might be hard on you for once, but it is legitimate, and you will have to think about it at a certain point in your life. Life insurance should be atop your priority list if you love your family and you are the only earner in the family. This insurance is for everyone who is financially dependent on you.
Premium insurance providers like the Colonial Penn Life Insurance Company are market leaders in this type of insurance, and you can choose fully customize the plans as per your needs.
The factors that you will need to consider while buying a life insurance policy are as follows:
As per your age, you can choose the subtype of life insurance that is best for you. The amount you pay every once in a while depends on your age and varies with every service provider.
- Time Frame
Another important aspect to select a policy is the time for which you need it. Do you need the cover till your children's careers are in their prime? Or do you need it till you repay the home loan you just took? Term life insurance is good for these situational needs.
If your needs are for the whole life, then you should choose a lifetime scheme that doesn't have any upper cap on age.
This one is a no brainer. You need to have a beneficiary that will receive the benefits of your plan. Restrain from naming a minor to receive the funds because often they are not eligible to do so.
- Cover Amount
Prepare a list of all the expenses that your family might have to bear after your certain demise. These expenses can be a mortgage, college fee, medical bills, loan repayment, etc. Choose the cover amount as per your personal needs, and restrain from clicking the first link on the internet.
2. Health Insurance: Mighty Hospital Bills? Mightier Savings.
After you see the uprising trend of healthcare prices, you will not find a reason not to buy health coverage. As of 2020, the total healthcare expenditure of the U.S.A. was a soaring 18 percent of the country's GDP. Fast forward to 2028; this amount will be a soaring one-fifth of the total Gross Domestic Production. The amount is a huge amount for anyone to spend on their healthcare needs.
When we are thinking about securing our family's freedom after us, then why shouldn't we secure our finances by the time we are alive? We are already prone to fall sick more often than before, thanks to the increasing pollution levels and food contamination.
Even the simplest of hospital treatments like plastering a broken bone takes a huge toll on everyone's savings accounts. That's why you need a health cover to provide you with funding when you are in a hospital.
Factors to think about before buying health insurance:
- Maternal Welfare
If you are a female, the first thing you should check with your health provider is if they will cover your pregnancy bills or not. Maternity bills are also on the rise with general treatment bills, make sure your insurance agency has plans to cater to those needs.
- Look For All-Dimensional Protection
When you are assessing various schemes, you should know that admitting in a hospital ward is not the only medical expense you might have. There are various expenses like visiting the doctor, following-up, blood tests, and other scans that most companies do not cover, neither they accept this openly in front of you. To avoid these extra expenses, look for the companies that provide you with roundabout cover for every penny that you might spend on your health.
- Check The Waiting Period
Almost all health policies have a waiting period to provide funds for any diseases. Especially, if you have any disease at the time of purchasing the policy, the company will have restrictions that limit them to paying your bills for a certain initial period. Always choose the company/policy that has the least waiting period in their contract note.
3. Cyber Insurance: A New Age Safety.
About ten years ago, you were worrying about pocket-pickers in the streets. In today’s age, that threat has taken a new form – cyber crimes.
In the last two decades, the world has seen continually growing online transactions, bank statements and credentials uploads, and much more. With so much financial input happening over the internet, the likelihood of online frauds and hacking also increases. Many companies now offer cyber insurances to save their clients from cyber phishing, theft, spoofing, and data breach.
Factors to consider before buying cyber insurance:
- Sub-limits Offered By The Company
Every insurance selling company has a limit up to which it will cover your damages. Different companies have different sub-limits (10%, 20%, 25%, etc.) for different damages (email spoofing, cyber phishing, transactional loss, etc). Assess a list of companies for their limits, and then choose the best one.
- First Party Or Third Party Insurance Coverage?
This aspect creates a lot of confusion among clients. The first-party cover is for you if you incur losses from someone else over the internet. On the other hand, if you owe a company online, and one of your customers faces financial loss online due to any cybercrime, then the third-party coverage comes into play. Under the third-party insurance cover, the insurance company is liable to pay for the customer’s loss. You know which one will work best for you, choose accordingly.
Above are our top three mandatory insurance for everyone in the 21st century. We did not include automotive insurance on the list because it is mandatory for everyone who owns a four-wheeler. We insist you take all the above insurance to protect yourself and your family from all sides against any unannounced situation. Remember, insurance is not an expenditure, it is an investment.