With the different choices of insurance currently available, it can be a hard thing for some people to determine the sort of coverage that they should have and the sort that they can do without. These are a few tips that should put you on the path to making the right decision:
• Think about your needs.
• Consider your budget.
• Think about future changes to your family.
• Consider what would happen to your family if you didn’t have a certain type of insurance.
As soon as you have thought about the needs of your family, it will be easy to decide the type of insurance that is important. These are few of the more common insurance policies that the average person should be thinking about:
Health Insurance:
The need for good quality health insurance can hardly be overstated, most especially when you have children. These are the most common types of health insurance these days:
HMO Plans – This is the most restrictive sort of health coverage. They tend to be the cheapest for both the employers and the employees. Participants in such schemes may only see the approved physicians. If you need to see a specialist, you can only do so with a referral from your primary care giver. Co-pays are rather low, with virtually no deductibles on basic services.
PPO Plans – This is a combination plan and it usually works like a HMO but it permits the patients to see any physician whether such a physician is part of the plan or not. A lot of people love the flexibility and options which are available with this sort of plan but premiums tend to be much higher and deductibles may reach as high as 20% when you’re seeing an out-of-network provider.
Indemnity Plans – These sorts of plans work very much like old-fashioned insurance policies. A patient sees any doctor they choose without a referral or pre-approval, but is responsible for 20% of the fee. Clearly the most versatile type of policy, it is also the most expensive, both in the case of premiums and deductibles.
Automobile Insurance:
If you own a car, you are legally bound to cover every driver in your household with collision and liability insurance.
Disability Insurance:
How would your family pay the bills if you were taken ill or injured and were unable to work for an extended period of time? A lot of employers tend to offer short term or long term disability insurance policies but a number of other employers do not. If you cannot work due to medical reasons, short term disability may pay you from 60% to 100% of what you currently earn depending on the particular policy you’re on, starting from about 30-60 days after your injury and for duration of 3-6 months.
Long term disability insurance is for longer illnesses and injuries. As soon as short-term disability coverage has expired, the long term disability benefits will kick in until you get back to work. However, this isn’t the same thing with the government disability benefits that a number of people with permanent disabilities may qualify for. You should ensure that you check with your employer to determine whether they offer these sorts of benefits. If they don’t then you may want to think of buying your own policy especially when you are the sole-breadwinner or when you work at a high-risk job.
Dental/Eye Coverage:
While dental and eye coverage used to be a normal benefit for most fulltime employees, this is no longer the case, leaving some employees solely responsible for taking care of their family’s dental and eye costs. These types of policies usually cap at a certain amount and only offer coverage on certain procedures. Still, they can be beneficial to those without enough income to handle these unexpected costs.
Homeowner’s/Renter’s Insurance:
If you own your home through a mortgage company, your mortgage company usually requires that you should have enough insurance to cover the costs of your mortgage in case your home is destroyed by fire. If you’re renting, your landlord has coverage on the building but you alone are responsible for covering your belongings.
Life Insurance:
Considering life and death issues isn’t something people like to do but accidents can happen and people will die. The whole purpose of life insurance is to help your family continue to pay the bills if you die and they lose your income. Insurance for children is usually to cover the costs of the funeral and for lower income families it is a good idea especially as they may be weighed down by these costs in the case of a tragedy.
