What do helmets, life jackets, and insurance have in common? They all seem like a vexation when you do not need them, but when you do, you are even more grateful that you were prepared. Wreck your motorcycle without a helmet, you could suffer fatal injuries. No life jacket when you are partaking in water sports, you may drown. No insurance and you become ill, wreck, or you lose everything in a flood or fire, you might be left with monumental debt you could never pay off. Many of us understand that it is important to have insurance. We know that there is a huge financial risk that not having it brings, but that is the gist of it. Insurance is a complicated topic. The following is a list to eight types of policies you should not chance going without…
Health Insurance
Did you know that medical debt is responsible for almost half of all bankruptcies in the United States? Choosing not to carry medical insurance puts you in a vulnerable spot for a potential financial debacle. A single major medical emergency may result in thousands of dollars of unexpected expenses. It is not worth the risk; do not chance it. While medical insurance is undoubtedly expensive, this is no reason to go without coverage. Even if you do not keep up with routine check ups, health insurance is still vital. One way you can save on your monthly premium is by choosing a high deductible insurance plan with a Health Savings Account or HSA. High deductible plans means you will be held accountable for more of your healthcare costs up front, but you will have a cheaper monthly premium. Choosing a high-deductible plan means that you qualify to open an HSA. An HSA is a tax-advantage savings account designated specifically for covering medical expenses. Consult with your independent agent to discuss which high-deductible health plan options you are able to combine with an HSA.
Other reasons you can benefit from having a Health Savings Account include…
- Tax Deductions – You are allowed to deduct your HSA contributions from your business income or gross pay. In 2019, the tax deduction was 3,500 for singles and 7,000 for married couples.
- Tax-Free Withdrawal – You are able to use the money tax-free on qualified medical expenses. These include health insurance deductibles, dental and vision expenses.
- Tax-Free Growth – By investing the funds you contribute to your HSA, they will grow tax-free and you can choose whether you want to use them now or down the road.
In addition to traditional health insurance plans, some companies are offering high-deductible health plans with HSA accounts. Take the time to compare the options available to you to determine if a high-deductible plan can save you some money.
Auto Insurance
You should never cruise around in your car uninsured. Not only is it illegal but reports claim that the average loss per auto claim is nearly $5,000. Do you have that kind of money saved up to pay out of pocket. There are a few different options available to you when it comes to auto insurance, therefore you have no excuse to go without it. These include…
- Collision Coverage – This plan will cover the cost to repair or replace your vehicle should it be damaged or totaled.
- Liability Coverage – Should it be determined that an accident was your fault, liability coverage will cover the majority of the costs or property damage caused in the car accident. Many states have made liability insurance a bare-minimum, this is why it is important that you reach out to your insurance agent to get an understanding of what the basic requirements are in your state.
- Comprehensive Coverage – The significant level of protection offered through comprehensive coverage will cover losses that were not the result of a car accident. This includes flood, fires. Theft, hail, vandalism and more.
Remember to reach out to an insurance agent as they are a good resource and will help you decide just how much protection you need.
Homeowner & Renters Insurance
Check your homeowners policy to ensure that it includes extended dwelling coverage. Why? This is an additional layer of protection that extends beyond your policy limits. What does this mean for you? The insurance company will rebuild or replace your property even if the cost to do so exceeds your homeowners policy coverage. However, there is a limit to just how much the insurance company will pay– this typically between 20% and 25% above the amount your home was insured for unless you opted for additional coverage. It is important that you remember, the more your home is worth, the greater need you have for extended dwelling coverage. Homeowners insurance doesn’t cover everything. It is important that you consult with your agent about what is covered under your policy and what is not.
Two things that are not included in the standard policy…
- Flood Insurance – Many homeowners are unaware that flood insurance does not come standard in their policy. Flood insurance is separate from water backup protection. Talk with your insurance agent for more in depth information.
- Earthquake Coverage – Depending on your location, earthquake coverage might be excluded from your policy. If it is something you need, reach out to your agent.
If you do not own a home and instead rent or lease property, you should still invest in insurance. In the event of a fire, flood, burglary, or other type of disaster, not having renters insurance means you will have to come up with the money to replace all of your belongings. Your independent agent will be able to guide you through the process, covering everything you need to know about homeowners and renters insurance. If you have a full emergency fund in place, you might consider a higher deductible policy to reduce your premium and save money.
Umbrella Policy
Just like an umbrella comes in handy on a rainy day, an umbrella policy does the same. What is it? It is a type of insurance that provides you with a little extra protection for yourself and your assets when you need coverage beyond the limitations of your auto and homeowners insurance. Let’s just say that you are found at fault for a multiple vehicle collision. You could be held accountable for any medical bills and property damages pertaining to the accident. These will add up quickly– and to more than your auto insurance policy will cover. If the other driver’s decide to sue you for the difference, you could lose absolutely everything including your home, your life savings, and even your future earnings. How can you protect yourself from a situation like this? Invest in a personal liability umbrella policy. It is highly recommended for those that have a net worth of more than $500,000 or more. Umbrella policies only cost a few hundred dollars annually but can increase your liability coverage by $1,000,000 from the standard $500,000. Get in touch with an Endorsed Local Provider to help you get adequate coverage.
Long-Term Disability Insurance
If you are unable to work for an extended period of time due to injury or illness, a long-term disability insurance policy will protect you. Not worried about a permanent disability keeping you from working? The Social Security Administration claims that 25% of 20 year olds will become disabled before they turn 67. With that in mind, it is too risky to be cheap when it comes to long-term disability. If you are in your prime working years, a permanent disability could really put your future dreams and aspirations on the back burner. Several companies offer their employees long-term disability insurance so that may be the place to start to ensure you’re covered. As you explore your options, you will discover that short-term disability was only intended to fill income gaps pertaining to injury or illness that are preventing you from working for three weeks to six months. This is insurance that you might consider skipping especially if you are equipped with a fully funded emergency fund that will cover your needs. Need help figuring out what other coverage you might actually need.
Term Life Insurance
All too often people do not take life insurance seriously. Approximately 30% of Americans do not carry a life insurance policy. Could you imagine life if you passed away suddenly? How will your family be able to survive without your piece of the pie? You do not want to put that burden on them. A term life insurance policy provides your family with between 10 and 12 times your annual income. This will alleviate some of the stress your family may face by securing them with the money to make ends meet, to losing their, or affording higher education. Prioritize this, reach out to us. Term life policies are affordable and will provide your family with the security they need– you can’t put a price tag on that. When shopping for life insurance, it is important to understand the difference between term life insurance and whole life insurance. One is a better deal than the other. Oh, so you are single and do not have any dependents? If you have excessive debt and little to no savings, you should think about a small term life policy. This will allow your loved ones to pay off your existing debt and pay for your funeral expenses. If this isn’t you and you have the cash to cover your burials, you might be able to do without life insurance, but seriously why change it? The younger you are, the more reasonable expense is. You have no reason to wait until marriage to get insured.
Long Term Care Insurance
Covering a range of services including nursing home care and in-home help with day-to-day tasks such as eating, bathing, and grooming, long-term care insurance is something you should consider by the age of 60. Long term care is provided to those who have a chronic illness or disability. It is expensive and not typically covered by Medicare. Why do you need it? Long-term care coverage helps you to protect your retirement or 401k savings from the expenses that rapidly add up for those needing long-term care assistance. You are probably not going to need long-term care until you are 60+ so if you are not close to that age yet, it’s probably not something you have to worry about. Factors like your health and family history will contribute to your decision on when it is time to purchase long term care insurance. These will also contribute to how much it will cost you. If you are wondering how long-term care will fit into your personal situation, call us. And if this is not something you really have to worry about yet, maybe your parents are reaching this stage of life. When the time comes to consider their long-term care options, you will only wish you would have done the work sooner.
Rollins Insurance represents multiple A-rated insurance companies to make sure we deliver the most competitive rate packages to our clients in Kentucky and Ohio.
Contact us (859-781-7283) for more information or get a free quote!
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About Rollins Insurance
Rollins Insurance is an independent insurance agency providing our clients the best prices with the most coverage possible since 2008. We represent multiple A-rated insurance companies to make sure we deliver the most competitive rate packages to our clients in Kentucky and Ohio. We find that most people are under-insured and over-paying when we meet them. We love what we do and our primary business is Personal Auto, Homeowners, and Life and Health insurance. We are a family-owned and managed business that specializes in providing needs-based insurance services.
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