Many types of insurance exist to help families gain financial protection. However, not every family has the same needs or risks, so it’s important to customize your insurance policy. Here are 4 types of insurance for families to invest in to meet short-term and long-term needs.
- Life Insurance
One of the most valuable types of insurance for family planning is life insurance. It pays benefits to survivors to help them establish financial security, as well as paying for the policyholder’s final costs. Many people enroll in a group life insurance plan through their employer, which is often the most affordable option for a family.
You can also take out your own policy. The main types of life insurance are whole life and term life. While the latter is more affordable, it provides coverage only for a set term. A whole life plan, by contrast, offers a wider selection of benefits and grows in value like a savings account, which can be used by the policyholder for emergencies or to borrow against.
- Health Insurance
Everyone needs some type of health insurance plan, whether it’s from their employer or set up independently. In 2021 only about 9 percent of the U.S. population lacked a healthcare plan, according to the Centers for Disease Control (CDC). Over 60 percent of Americans were covered through their employer or the private insurance marketplace. The rest were enrolled in government programs such as Medicare and Medicaid.
Low-income Americans should find out if they are eligible for health coverage through Medicaid. If you have a more moderate income, you may qualify for coverage through the federal Affordable Care Act (ACA).
- Long-term Disability Coverage
Most people assume they will never need disability coverage, but one in four workers will eventually become disabled, according to the Social Security Administration. You can get both short-term and long-term disability insurance through your employer, which, again, is the more affordable option.
If you decide to set up your own coverage through a private insurer, be aware that most policies only reimburse a percentage of lost income. It may range from 40 to 70 percent, so be sure to be clear on the amount. The cost of disability insurance reflects multiple factors such as age, lifestyle, and health. Review the policy carefully and check if there’s a three-month waiting period before coverage becomes available.
- Auto Insurance
The fourth type of insurance coverage most families need is auto insurance. Thousands of Americans die in traffic accidents every year, so it’s important to practice driver safety and have the right coverage limits in place. If you drive a car, you need insurance as required by state law. Even if you just park your vehicle and rarely drive it, you still need coverage. Failure to carry mandated insurance can lead to serious fines.
The cost of auto insurance depends on your age, where you live, and your driving records. You can also reduce your monthly premium by raising your deductible, which is the small amount you pay upfront before your policy kicks in to cover the balance. There are other ways to reduce your auto insurance costs, such as reducing annual miles.
Cover Your Family with Action Insurance Group
It’s important to get the right family insurance to secure the finances in case of unexpected disasters. Contact us at Action Insurance Group, and we will assist you in finding appropriate plans for your family’s needs.
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