Why Is Insurance Important in Your Financial Planning?
24 Jan 2019
Insurance is an essential part of any financial plan. You need to be prepared for the unexpected. Why is insurance important? Learn more right here.
In 2017, the United States led the life insurance premium writing industry. In fact, the value of life direct premiums amounted to almost 547 billion U.S. dollars. But, insurance comes in all shapes and forms.
Today, you can get insurance for your business, home, and even your pet. But, why is insurance important?
Read on to find out more about the importance of life insurance in your financial planning.
Why Is Insurance Important?
A financial plan is a great way to put money aside for retirement. But, many overlook insurance when planning for the future.
Financial planning insurance is a sure fire way to prepare for the unexpected. It will help you to reach your goals, even if you hit a financial crisis.
Aside from helping you, the right insurance policy could also protect your loved ones. This is especially true if you fall ill or worse.
Determining Your Insurance Needs
There are various factors you need to consider when shopping for insurance. Some of these include your:
- Economic situation
When it comes to insurance, there is no one-size-fits-all solution. For example, life insurance is a must if you have a family. If you don’t, you could get away without it. The same goes for if you own your own home and car. Once again, if you don’t you don’t have to worry about these types of insurance policies.
Different Types of Insurance
As mentioned above, there are various different types of insurance. Here are some of them:
Home insurance will help you if a natural disaster occurs. It will also cover you in the case of a lawsuit if someone hurts themselves during a project on your property.
You should get coverage for at least 80% of your home’s resale value. That said, there are various different types of coverage so do your research before signing on the dotted line.
Life insurance will give your family the money to maintain their standards of living should you pass. It can also help repay any debt and can help with your kids’ education tuition fees.
As the name suggests, auto insurance covers your vehicle in the case of an accident. It will also protect you from liability for damages or injury to someone else while driving.
Car insurance is a legal requirement if you own a car, truck, or motorcycle. You should also consider getting collision, theft, and fire coverage for your vehicle.
Health insurance often comes as an employee benefit. That said, you can buy private health insurance – although this is considerably more expensive. Make sure to check with your employer how much they cover through the company before going private.
Talk to a Financial Planner
So, why is insurance important? Well, the truth is it does more than cover you in the case of a financial crisis. The right insurance will also cover your belongings, and most importantly, your family should anything happen to you.
That said, choosing the right insurance can be challenging. With this in mind, why not consult a financial planner? By contacting Solera Asset Managers today, you can get help for everything from financial planning to tax strategies.