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Six Basic Types of Insurance You Need

written by: M Lambert•edited by: Stephanie Mojica•updated: 5/22/2009

There are six basic types of insurance that everyone needs. They will protect you, and your loved ones financially in the case of disaster or emergencies. Learn what insurances you need.

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    Six Basic Types of Insurance You Need

    It is important to have the proper amount of insurance to protect yourself, your loved ones and your valuables. There are six types of insurance that you need to do this. The other types of insurance are optional.

    Basic Types of Insurance: Health Insurance

    Health insurance is one of the most important types of insurance you can get. It will protect you from bankruptcy if you were to become extremely ill. It can also help you to avoid worrying about how you can afford treatment when you or a loved one is sick. At the very least you should get a high deductible health insurance policy. These policies are very affordable and will protect your from the most expensive illnesses and emergencies.

    Basic Types of Insurance: Life Insurance

    Term life insurance is an important way that you can protect your family if you were to die. It can provide the money necessary to care for your spouse or kids if you were to die. You should get about ten times the amount of your annual income. This will help to cover daily living costs and if manage wisely help you children be able to attend college as well.

    Basic Types of Insurance: Home Owner’s Insurance

    It is important to take the time to protect your home and the valuables inside of your home with home owner's insurance. Your home is your most expensive purchase, and it is an asset. It is important to protect it against damage, fire and theft. Additionally you can purchase clauses that protect you if someone were to be hurt at your home.

    Basic Types of Insurance: Car Insurance

    Everyone needs car insurance. It is illegal to drive without it, but it also helps to protect your car, and your assets if you were in an accident. Car insurance will help you to replace your car and pay your medical bills after an accident.

    Basic Types of Insurance: Long Term Disability Insurance

    Long term disability insurance protects your income if you are injured or become disabled. It will cover you after six to nine months of being medically unable to work. It is important to have this until you retire, because it can protect you and help you to continue to have a decent lifestyle.

    Basic Types of Insurance: Renter’s Insurance

    If you do not own your own home renter’s insurance is a necessity. It protects your property in the case of theft or fire. It can also protect you if you are the cause of damage to your apartment.