When you were a kid, your mom probably told you never to leave home without some Kleenex and enough change to make a phone call in case you got into trouble. Back in the day, two dimes would do it, and maybe carrying an extra two dimes in case you fumbled and dropped the first pair and couldn’t find them. Now most people carry a cell phone so carrying spare change is not a necessity, but the Kleenex…. well, that still makes sense today.
Just like being prepared with tissues or spare change for those daily little issues, having insurance policies in place will thwart most of life’s calamities and you will emerge from those times better for your preparedness.
“Fortune favors the prepared mind” -Louis Pasteur
Having the correct insurance policy in place is important, and, because everyone’s needs are different, and your life changes from when you are just a student to when you are ready for retirement, so should your insurance coverage be modified or tweaked through the years. To get the optimum advantage from any and all of your insurance policies, your best bet is to consult with an insurance broker, like John Savadjian, right here in New Jersey. His skills and expertise as an insurance broker will get you the perfect policy for each area of your life. A list of the most-common types of insurance policies is found below. Compare that list to what you have now, or think you need to procure down the line.
Health insurance. While the Affordable Care Act, more commonly referred to as “ObamaCare” has forced everyone to obtain health insurance or pay a fine for “going bare”, the simple fact remains that good healthcare without insurance would be impossible to afford. If you are a student, you may remain on your parents’ policies until age 26, but after that 26th birthday, you must seek insurance coverage pronto to fill the coverage gap until you get a job and receive health insurance coverage through your employer. Health insurance is something you will need the rest of your life, including the benefits you will receive from Medicare once you turn 65 years old.
Auto insurance (obtain a policy once you get your first vehicle). The National Safety Council states that traffic fatalities increased some 14% from 2014 to 2015. The estimated number of deaths per 100 million miles traveled in 2015, based on current rates was also on the rise. Thus, you need a safe vehicle and you need comprehensive insurance coverage to keep that vehicle and yourself protected. As long as you drive a car, you will need to purchase insurance, and, though you may try to cut corners by eliminating certain components of your automobile insurance, your best bet is to cut something else from your budget and get comprehensive vehicle coverage so that you do not lose your shirt should a catastrophic accident occur.
Renter’s insurance (obtain a policy once you rent your own place). Before you take the big step and buy your own home, you most likely will reside in an apartment, or perhaps rent a home. Renter’s insurance is important to have, even if you’ve not accumulated a lot of possessions yet, because in the event of a fire, leak, or storm, the relatively low premium will cover the costs of replacing your personal property as well as provide you with a temporary living situation should you be unable to remain on the premises
Disability insurance (obtain a policy as soon as you begin your first job “in the real world”). Disability insurance is often provided by your employer and is rolled into your benefits. Like life insurance, disability insurance premiums are not usually taken out of your paycheck. But, if your employer does not provide this perk, or you are self-employed, it would behoove you to get an individual disability insurance policy. Many people also purchase increased coverage beyond what their employer provides. Did you know that the Social Security Administration states that over 25% of today’s 20-year-olds will be disabled before retirement? Not to be a doomsayer, but an accident or a lingering illness that will not permit you to remain at your present job, could have you unable to make payments for your car, home – even your utilities. Disability insurance will provide you with payments comparable to your salary so you and your dependents will not become penniless as a result of your medical misfortune. Right around the time you traditionally retire, at age 65, the policy will not be valid, as the longest disability policy available only goes to age 65.
Life insurance (obtain a policy once you get married and/or have children). Life insurance, like disability insurance, is a means to replace your income for those who rely on you until something catastrophic happens and you are no longer there for your family. Like disability insurance, life insurance may be provided through your workplace, or you could take out a separate policy. It is especially crucial to have a life insurance policy when you have dependents like a stay-at-home spouse and minor children. Many financial experts advise getting a life insurance policy that replaces up to ten times your annual income. You may even opt for term life insurance (which, as the name suggests, is a policy that only covers you for a set amount of years); this works well because you will only be covering your children a finite amount of years as they eventually leave the nest and become financially independent.
Homeowner’s insurance (obtain a policy when you buy your own home). This is a must-have insurance policy – simply put, if you own a home, you insure it. Don’t be penny wise and pound foolish when it comes to insurance for your home. You need a comprehensive policy that will cover everything from the structure itself, your belongings, and even liability coverage should someone be injured on your property (like on that uneven concrete, or even a trip-and-fall on your icy sidewalk). Not included in most homeowners policies is coverage for natural disasters for areas in the United States that are prone to flooding, earthquakes, wildfires or similar natural disasters – you may need to purchase additional coverage for these events.
Long-term care insurance. This insurance is very valuable as you look toward your golden years. If you have the misfortune of become disabled, or you need help with daily living, (whether inside the home with a visiting nurse or in a nursing home), the cost of long-term care or an extended stay in a facility could wipe out your finances. The time to consider putting long-term care insurance in place is when you are younger, because the sad fact is that the older you get, the more expensive you are to insure.
And, finally… let’s not forget the important furry family members of the house sometimes known as Fido and Fifi.
Pet insurance (if you have a pet). While pet insurance isn’t necessarily a must-have, if you would put yourself in debt to save your pooch, and would agree to surgery costing thousands of dollars, you might want to consider pet insurance. Some plans even cover routine visits, as well as surgery, and average just $100.00 to $300.00 per year.
Each stage of your life all require the additions of different types of insurance along the way. Do you need to add layers of insurance to your existing policies? If your policies need tweaking, do be proactive and contact John Savadjian, an insurance broker in New Jersey to help you get your insurance ducks in a row today.