Insurance is often treated as a dirty word when it comes to the administrative aspects of your professional and personal life. For many, it simply represents an additional cost that provides little value to day-to-day life. In a time of economic strife where household budgets are being stretched ever thinner, it is understandable why so many might be reticent to think about insurance and its associated costs.
But insurance is also often misunderstood, and for many can be a crucial lifeline when things take a turn for the worse. Of course, there are many different forms of insurance, with different offerings and provisions. For the uninitiated, which insurance plans should you consider enrolling for?
Life insurance is arguably the single most important form of insurance you can take out for your family, particularly if you are the leading financial contributor to your household. Life insurance schemes ensure that immediate family is looked after in the event of your death.
Life insurance plans are paid monthly and offer either a lump sum or annuity payments in the event of your death. This way, the sudden loss of your financial contributions does not negatively impact your family’s living situation or quality of life.
Next up, and most importantly for the short to medium term, is home insurance. Home insurance is designed to protect your household from unexpected costs arising from unexpected emergencies and incidents. Home insurance plans differ from plan to plan and from provider to provider, but typically insure the fabric and contents of your property against costs relating to theft or damage.
Sudden events such as house fires or destructive storms are impossible to properly predict and can cause untold financial damage through the loss of your belongings and structural damage to your property. Home insurance sees your household reimbursed for these costs.
Work, and Liability Insurance
As a salaried employee, you would not usually need to think about work-related insurance plans. Your employer should already have some form of employer liability insurance, which pays out on their behalf in the event of a workplace accident or incident.
Severe injuries can come with high civil costs, which uninsured businesses can struggle to meet. An insured business can assure the financial support of workers should they submit a claim, such as an amputation claim due to a work-related injury; if you are in a position to choose your employer, ensure they have an adequate insurance plan that covers you proportional to the risks of your role.
Lastly, for households that own a car, car insurance is a must. Car insurance is also the most well-understood form of insurance, being a legal requirement for car owners to take out on vehicles in order to render them road legal. It is important to note, though, that car insurance is pinned to the car, not the owner; as such, drivers with car insurance are not necessarily insured to drive any vehicle.