7 Types of Insurance Coverage You Need (And 3 You Might Want)

There’s nothing like financial hardship or uncertainty to make you rethink your insurance coverage. From health and car insurance to homeowners and life insurance, having protection plans in place can offer great peace of mind during these uncertain times.

If you’ve been wondering what types of insurance you might need to protect yourself and your family, we’ve compiled this useful list. Here are seven types of insurance you need and a few more that you might want.

7 types of insurance you need

1. Auto insurance

If you have a car, chances are you already have insurance coverage for it. Basic coverage is required in most states. But do you have the most comprehensive and affordable car insurance coverage? Maybe not. Here are a few tips on finding the best car insurance for your needs.

How it works

Car insurance works by helping you to pay for any damages (caused by you or someone else) in the event of a motor vehicle accident. This might include things like medical bills from injuries, damage to your vehicle or someone else’s, and even other types of property damage.

Why you need it

Paying for any and all of these things out of pocket could be a tremendous financial burden — which is why it’s important to not only have coverage, but to also have insurance you can afford. This means being able to come up with both monthly payments and your deductible in the event of an accident. If you feel like you’re paying too much for car insurance right now, an online marketplace such as Provide Insurance can help you compare quotes quickly and easily.

2. Health insurance

Much like car insurance, health insurance falls into the category of must-have items in today’s world of privatized healthcare. Most people can’t afford to drop thousands of dollars during a medical emergency, or regularly pay for pricey prescriptions out of pocket. All of which makes health insurance (whether obtained through your employer or independently), a sound financial decision.

How it works

Health insurance plans vary more than you may realize. Although some insurance plans might cover only health emergencies, others can offer coverage for regular doctor visits, medications, lab tests and even preventative care (such as immunizations). The type of health insurance you choose depends on your age, what you can afford, and you guessed it: the state of your health.

Why you need it

One doctor’s visit alone can cost you hundreds of dollars without proper health insurance coverage; the average three-day hospital visit can easily cost tens of thousands of dollars. You can avoid paying those bills out of pocket by selecting a health insurance plan that offers you the coverage you need. Speak with your employer’s human resources department or visit healthinsurance.net for more information on purchasing health insurance.

3. Dental insurance

Dental work isn’t any cheaper than other medical bills, in fact, sometimes it can be prohibitively expensive. Although some health insurance plans might include dental coverage, others don’t. If you have dental work you’d like to get done or are prone to cavities, then you might consider purchasing dental coverage separately.

How it works

Much like the average health insurance plan, top dental insurance covers regular checkups and cavity fillings, also paying for a portion of more in-depth procedures such as X-rays and root canals. Additionally, some dental insurance companies offer various orthodontic coverage options, which is crucial for those in need of braces or similar treatments. Depending on the type of plan you get, you may be responsible for paying a copay or deductible for certain appointments.

Why you need it

Dental problems can be extremely painful when they emerge, and you want to be able to get the care you need as soon as you need it. You can avoid paying for all of these unexpected expenses out of pocket by selecting a dental plan that works for you.

4. Vision insurance

If you have a history of needing contacts or glasses, now’s a good time to make sure you have the appropriate level of vision coverage. Although some health insurance plans might include vision insurance, for many it’s optional and comes at an extra cost. Here are some things to keep in mind when selecting a vision plan.

How it works

Vision insurance works by supplementing the cost of eye doctor visits, exams, and products. Having vision coverage will help you and your family members save money on prescription glasses, contact lenses, and routine exams.

Why you need it

If you or someone in your family regularly requires vision exams and prescriptions, having vision insurance could save you money on these visits and services. Check out this marketplace to compare quotes on vision coverage.

5. Life insurance

Although it’s an unsettling thing to think about, it’s important to understand the hardships your family might face if you were to die. A life insurance plan will guarantee their financial well-being long after you’re gone, which offers great peace of mind for all families.

How it works

Like all insurance plans, life insurance is based on risk. For example, if an individual has an underlying health issue, an insurance provider may deem them higher risk than an applicant without a pre-existing condition. Most plans work similarly in that they allow a life insurance beneficiary to receive a certain amount of money (either for a set period of time or for life) after the loss of a loved one.

Why you need it

An affordable life insurance plan guarantees your family can continue to thrive, even in the event of tragedy. With Bestow, you can apply for life insurance online in just minutes, and there’s no medical exam required.

6. Disability insurance

Disability insurance is an important way to guarantee your income in the event that you become unexpectedly sick or injured. Some disability insurance plans, such as those offered from Breeze, will also cover accidents and mental illness.

How it works

Disability insurance works by offering a portion of your income while you recover from an accident, injury, or illness. At its most basic, there are two types of policies — short-term and long-term. Short-term policies cover disabilities anywhere from a few months up to two years; long term policies can provide coverage for years, or until you’re well enough to return to work.

Why you need it

If you’re concerned about providing for yourself or your family during an extended period of disability, consider taking out a disability insurance plan. This supplemental income will help guarantee that your family stays on track financially during injury- or illness-related hardships.

7. Homeowners or renters insurance

If you don't yet have homeowners or renters insurance, now’s a good time to consider getting it. Homeowners or renters insurance will help protect your property and belongings in the event of damage or loss due to things like fires, storms, or theft. Because you may not have the funds to make repairs or replace lost items out of pocket, this type of insurance policy can guarantee you at least receive monetary compensation for the losses.

How it works

Although homeowners and renters insurance typically covers property loss and damage, it can also cover things like personal injury if someone gets hurt in your home. These policies may also cover damage to your property due to inclement weather, such as a bad snowstorm or water damage.

Why you need it

If your home is damaged by fire or a storm, the recovery costs can be exponentially high. A homeowner's or renter's insurance policy is a worthy investment that can protect your property — and your bank account.

3 types of insurance you might want

Beyond the insurances you need, there are a few kinds of coverage you might also want, depending on your age and lifestyle. Here are several other helpful types of insurance to consider.

1. Long-term care insurance

Long-term care insurance is another one that isn’t fun to think about, but again, still very important. As the name suggests, it covers the costs associated with end-of-life care (typically for those 65 and older) at home or in live-in and assisted-living facilities.

How it works

Long-term care insurance policies cover the costs of the help you might need for basic daily activities such as eating, mobility, and bathing. These policies can also cover room and board at live-in facilities, which can cost thousands of dollars per month.

Why you need it

According to a recent report by Genworth Financial, the average cost of care at assisted-living facilities is $4,051 a month — the monthly cost jumps to $8,517 for nursing home care. If you anticipate needing long-term care, then it might be a good time to take out a long-term care insurance policy.

2. Pet insurance

Have a furry family member in your household? Then you might want to consider getting them insured. Bills associated with emergency and non-emergency veterinary care can easily rack up in the thousands for both cats and dogs.

How it works

Pet insurances are most useful when purchased while your pets are relatively young and healthy, as they won’t cover preexisting conditions. Assuming you’re able to do this, these policies typically work similarly to health insurance for people: basic coverage for routine exams, as well as coverage for unexpected injuries or illnesses.

Why you need it

Vet bills can be incredibly expensive for pets of all sizes and breeds. In order to avoid being put in the horrible position of putting a monetary value on your pet’s life, consider taking out a pet insurance policy. If your pet is already older with several serious medical conditions, get a quote anyway, then start saving that same monthly amount so that you’re better prepared for the next vet bill.

3. Flood insurance

With many homeowners insurance policies excluding flood insurance, it’s an important type of coverage to purchase if you live in an at-risk area. Flood damage can be incredibly expensive and challenging to resolve without the proper funds, and your home may be at risk even if the area isn’t prone to hurricanes or other coastal storms.

How it works

Most flood insurance policies are offered through the National Flood Insurance Program (NFIP). These policies are sold through regular insurance providers who act as a go-between for this federally-owned program. If you live in an at-risk area, chances are you’ll qualify for this insurance, which typically covers the cost of flood damage to buildings or property and personal belongings lost in a flood. Other private flood insurance policies may be purchased independently, and though more costly, they can still be effective in protecting your home.

Why you need it

If you live somewhere with a high risk of flooding, you’re going to want one of these policies. According to the Federal Emergency Management Agency (FEMA), the flood damage from just one inch of water can cost more than $20,000. If you think there’s even the smallest risk of your home becoming flooded, consider taking out a policy to avoid this hefty expense.

The final word on buying insurance

Buying insurance isn’t just about preparing for the worst, it’s also about knowing your finances and those of your family won’t be jeopardized if something bad happens. You can avoid being put in a challenging financial situation by purchasing insurance before you need it. That way, even if the unexpected does happen, both you and your family will have the resources necessary to get through it.