Buying insurance is a way of risk management, pay a certain premium to the insurance company, when encountered with the contract agreed upon the possibility of accidents, the economic losses suffered by the insurance company will be able to get compensation.

Some of my friends may have had such an experience, buying insurance is too expensive and too troublesome, and then regretted that they had bought less when the insurance claim was made. In this era of ubiquitous risk, buying enough insurance is a reliable life protection for yourself and your family.

The five most important types of insurance to buy

Auto Insurance

Auto insurance is a no-brainer. Almost everywhere in the U.S., there are laws mandating that drivers must have insurance before they can hit the road. If you don’t have insurance, or if you don’t have enough insurance, you will have to pay for your own medical expenses, car repairs, and everything else in case of an accident. If you are responsible for your own injuries and cause someone else to suffer some serious permanent injuries, such as paralysis and disability, the amount of long-term medical expenses and other liability compensation is very high.

Don’t leave it to chance. According to statistics, there are an average of 6 million recorded car accidents in the U.S. each year, nearly 40,000 people die in car accidents, and about 2 million are permanently injured in car accidents. According to data released by the CDC in 2010, medical and compensation costs for car accident injuries and deaths in the U.S. totaled more than $99 billion in one year.
So if you want to save money on auto insurance, you can consider raising your deductible or buying only half coverage if you drive an older car, but the amount of liability insurance must not be reduced, and many professionals recommend purchasing more than the total value of your own net worth of total liability insurance coverage. Of course, driving a new car with spare money partners should also consider collision insurance and comprehensive accident insurance, etc., if their car crashed to be repaired, insurance can also be reimbursed to reduce out-of-pocket expenses.

Health Insurance

As the saying goes, “Health is the greatest asset in life,” and in the United States, health insurance is indispensable. Most regular health insurance policies allow you to get regular checkups and vaccinations for free or at a very low cost, and also reimburse you for most of your medical expenses when you are sick, so that you can afford to pay for them.
There was once a study that said the number one reason Americans go broke is medical expenses →_→

The United States medical cost is very expensive, see an ordinary family doctor will be two or three hundred knives, if a blood test or do a special examination, casually is a few hundred, to see a specialist is even more expensive; not to mention the cost of surgery and hospitalization, thousands are idle. The average working family is not far from bankruptcy if they get sick once.
So even though buying health insurance itself isn’t cheap, many people would rather have the most basic insurance than nothing at all. Many young people in the United States can’t afford regular medical insurance premiums, so they will buy a cheaper Short Term Health Insurance or Hospital Indemnity Insurance, at least in case of a serious illness, there will be insurance to help reimbursement.
Luckily, many employers also provide health insurance benefits, which can save the average working class a lot of insurance costs. Therefore, when looking for a job, in addition to the salary, you must also consider whether there are other benefits such as health insurance, which is also a hidden wealth that should not be underestimated.

Home Owner’s/Renter’s Insurance

In the U.S., if you have a loan to buy a house, the bank will force you to buy Home Owner’s Insurance. In case of fire or wind damage to the house, or if the house is stolen or damaged, or if the homeowner is sued and needs to compensate other people and so on, the homeowner’s insurance will pay for the homeowner’s losses, and it also protects the homeowner’s ability to continue to repay the loan.
Even if it is not mandatory, homeowner’s insurance is a wise investment. This is because in addition to covering the construction of the house, homeowner’s insurance usually covers claims for damage to the homeowner’s personal belongings. For example, if your car is smashed or your laptop is stolen from your car, the comprehensive accident insurance of your auto insurance will only cover the cost of repairing the car, but not the personal belongings such as the laptop, whereas homeowner’s insurance will cover such losses.
In addition, homeowner’s insurance usually includes homeowner’s liability insurance. For example, if someone falls and gets hurt on your property, homeowner’s insurance will reimburse the medical and related expenses; or if you are sued for damages to someone else’s property, homeowner’s insurance will pay for the costs of the lawsuit as well as the compensation.

However, homeowners should also be aware that general homeowners insurance does not cover damages caused by natural disasters such as floods, earthquakes, and landslides, so it is best to consider purchasing additional insurance if your home is located in a high-risk area where these types of natural disasters are common.
Although renters don’t have to worry about damage to their home, renters insurance will cover personal belongings and personal liability, as well as reimbursement for the cost of renting a hotel or other place to stay if your apartment is temporarily uninhabitable due to a fire, for example. Renters insurance in the United States is only $187/year on average, usually only $15~$30/month, less to go out to eat on the affordable, or very cost-effective.

Disability Insurance

There are unpredictable winds and clouds, if an accidental injury, serious illness and so on, resulting in not being able to go to work without a salary, it is likely to affect the normal life (including payment of rent, mortgage, utilities and other daily expenses, etc.), to buy disability insurance for when you lose the ability to work, the insurance can be another way to protect your income.
Although the U.S. social security system is relatively complete, Workers’ Compensation only insures work-related injuries, Unemployment regardless of the incapacity to work, apply for Social Security Disability Insurance (SSDI) generally need to wait for at least 5 months, and the approval is very strict and easy to be rejected, and even if the successful applicant has been rejected, it is easy to be rejected. Even if the application is successful, the average benefit in 2018 is $1,197/month, which is far from making up for the normal income.
Disability insurance is mainly divided into Short-Term (referred to as STDI) and Long-Term (referred to as LTDI) two categories, most of which will be paid out at about 60% of the pre-tax income, because individuals who buy this kind of insurance, the benefits are usually tax-free, so it’s almost the same as the money that actually comes to your hand after deducting taxes.

Short-term disability insurance generally pays out for a shorter period of time, about three months to a year, but can start receiving benefits sooner (usually after 1 to 14 days), while long-term disability insurance has a longer waiting period to start receiving benefits, usually after 90 days, but keeps paying out for a longer period of time, which can be several years or even until retirement. The cost of disability insurance is usually about 1% to 3% of your original income, depending on the terms of the policy, and usually waiting times, benefit percentages, and benefit periods are optional.
Many employers also offer disability insurance benefits, so guys might want to check with HR. However, it is important to note that if your employer purchases the insurance, or if you choose to purchase the insurance with pretax income, you will be required to pay taxes in the event that you need to apply for benefits. In addition, according to the Society for Human Resource Management (SHRM), there are five states in the U.S. that provide or require employers to provide short-term disability insurance: California, Hawaii, New Jersey, New York, and Rhode Island, so you can check the official website for details.

Life Insurance

Death is not cheap in the U.S. According to GoBankingRates.com, the average death necessity expense in the U.S. is $11,618, and the median funeral out-of-pocket expense (which includes the cost of viewing and cremation of the remains) is $7,360.If you are the primary source of income for your family, that touch wood says that in case of XXX, your family will likely be in a financially difficult If you are the main source of income for your family, then touch wood says that in case of XXX, your family will probably be in financial difficulties, and purchasing a life insurance policy will give your loved ones a protection.
There are many different types of life insurance, but they can be divided into two basic categories: Term Life Insurance and Whole Life Insurance.

The so-called term life insurance, that is, in the insurance contract specified period (Term, usually ranging from 5-30 years), to provide insurance protection for the insured, beyond the contract period, nothing; while whole life insurance is not specified in the contract period, will remain in force until the death of the insured, and whole life insurance is usually accompanied by a deposit investment function, can accumulate the cash value, you have the need to “borrow” the cash amount to use. You can “borrow” the cash amount when you need it.
Life insurance premiums depend on the age and health of the insured, and whole life insurance can be several times more expensive than term insurance for the same amount of coverage for the same person. However, term life insurance is usually affordable, so it’s worthwhile to purchase a term life insurance policy when you don’t have a lot of money to spare.

Especially if you are the breadwinner of your family and are making payments on your home and car, it is important that you have a life insurance policy that lasts long enough (e.g., to cover the entire term of your loan, or until retirement age) and has enough coverage to pay off all of your debts, as well as your family’s future living expenses.

Of course, if you win a big lottery, your family is very wealthy, and your family will not be under much financial stress, then life insurance may not be necessary.

Five of the worst insurance policies to buy

Flight Insurance

Flying can actually be considered one of the safest and most secure ways to travel, and it’s a bit of a waste to spend money on insurance for such rare accidents, and you’re already covered if you have life insurance.

Mortgage Protection Insurance

This type of insurance is similar to term life insurance, but claims are limited to paying off the mortgage, unless you’ve been denied coverage by the insurance company due to a health condition, in which case it would be more cost-effective to buy term life insurance outright.

Cancer/Disease Insurance

It’s much more worthwhile to spend the money on a good health insurance policy, and this kind of insurance that only covers certain diseases is quite unnecessary.

Credit Card Insurance

Although there are a lot of ID Theft issues out there right now, it generally doesn’t cost you much actual money when it comes to identity theft issues as long as you report it properly. Because federal law states that if a credit card is stolen an individual is liable for up to $50, and many banks have their own Zero Fraud Liability, it won’t even cost you a dime as long as you report it in a timely manner. And as far as repairing your credit goes, these are completely free to do on your own, it just takes some time mentally.

Child Life Insurance

As mentioned earlier, buying life insurance is mainly for people who are the breadwinners of the family to buy protection for their family members, and there’s really no need to buy insurance for small children who don’t make any money; even though whole life insurance has some investment preservation features, it’s return on investment can be a lot smaller than the return on accounts such as 529 Plans, IRAs, and so on. However, if your child is a starlet and contributes to your family’s income, it’s worth it to get an insurance policy for your child.