Confused About Insurance? Here are the Basics!

Are you considering getting yourself insured but are confused about the types of insurance plans out there? Afraid you’ll end up signing up for a policy that you don’t need or is not right for you? Read on to get the lowdown on the types of insurance you should know about and which you should prioritize.

by Sher Baustista, 08 July 2017

Insurance can be intimidating for many of us. We want to ensure that we are secured and for the most part, that the insurance plan we pick can cover all our needs. A young, single person still busy with career and travel will have different needs from, say, a parent with a mortgage and who has ongoing education and health expenses to consider, among other things. Some people decide to pass on insurance altogether because they think it isn’t worth it and their money is better put to use in a savings account. The cost of getting insured, however, is minute compared to the price and hassle of having to cover for untimely illnesses, vehicular accidents, or home repairs. Read on for the basic types of insurance you should be signing up for and why they should be viewed as investments rather than extra expenses.

Life Insurance

This isn’t as morbid as some people might think. Sure, it is primarily meant to protect your loved ones after you’re gone, but these days, life insurance can be a protection policy or an investment policy. Depending on the insurance company, modified plans will offer different clauses and terms. Life insurance guarantees that should anything befall you (terminal illness, death) your beneficiaries are adequately taken care of when the policy matures. Before you sit down with your agent, know your reasons for getting life insurance. This will dictate what kind of plan is best for you and your loved ones. Some insurance plans have added investment components that you can later use for retirement purposes. If you want to retire early with a comfortable nest egg, ask your agent about the investment options that can be converted into a retirement plan.

Health Insurance

This type of insurance is meant to take care of your medical bills in case of sickness or hospitalization. It covers all forms of expenses incurred, depending on the plan you choose. From general HMOs to more comprehensive plans, health insurance is a must in today’s world where medical bills can pile up really fast. Individuals without coverage can easily be overwhelmed and personal savings can be quickly depleted just to cover the cost of unexpected illness. While there are various kinds of health insurance, it’s best to sign up for one that will cover your future needs, based on your age, gender, and other factors. You can consult with your chosen provider for the package that works best for you and your needs.

Travel Insurance

If you are a modern-day nomad and love living your life on the road, you should always have some form of travel insurance. Not only does it cover you for unexpected illness while abroad, which can be incredibly scary, but it also covers trip cancellations, and smaller things such as lost baggage. Insurance companies have evolved to cover us for almost any eventuality. Some companies, such as FWD, even offer insurance with coverage for death or disability due to a terrorist attack.

Auto Insurance

This is mandatory if you have a car. The comprehensive insurance payments may be an annual inconvenience but generally well worth every penny considering the hefty expenses associated with automobile accidents. Even minor damages cost a pretty penny. You wouldn’t want to be caught without this when on the road. Not only is it irresponsible not to have one, it is also illegal. It is required by law to at least get basic TPL car insurance, though comprehensive insurance is advised.

Home Insurance

Property owners know the value of having homeowner’s insurance. Having your residence covered gives you security against unforeseen events such as fire, theft, vandalism, or flooding. Heaven forbid your house burn down but wouldn’t you sleep better at night knowing your home is protected from these scenarios?