February 14, 2020
Insurance needs can vary widely depending on your age, health, financial situation and family needs.
Here is some information to consider regarding the standard insurances out there as you take care of your financial health. For more information, we recommend you consult with a professional insurance broker.
Health Insurance
Health insurance works by protecting your assets from the high cost of medical care, safeguarding your financial security and credit in the process. Even if you’re lucky enough to avoid major expenses, paying for insurance is still an investment in your long term well-being.
Insurance typically covers things like annual physician visits and certain prescriptions which may contribute to your overall health and wellness. In Massachusetts, one can get insurance through MassHealth, or possibly through their employer. Employers often contribute to the cost of a company plan, which will vary depending on what type of plan one selects i.e., HMO vs. PPO, Family vs. Individual, High vs. Low Deductible, etc. Vision and/or dental insurance are usually separate.
Auto Insurance
Massachusetts law requires you to at least have liability insurance before a vehicle can be registered. Simply put, you cannot responsibly own and operate a car without proper insurance.
Auto insurance limits the car repair and injury costs you would pay after an accident caused by you or someone driving your vehicle. The cost of auto insurance varies, so take your time and shop around to assess your options. Price factors include driving record, where you live, the make and model of vehicle and the ages of drivers in the family.
Homeowner Insurance
Homeowner's insurance is required by your mortgage holder and should remain a “must-have” even after the mortgage is paid off.
For most people, a home is not only where they live, but it also represents the biggest financial investment they will make in their lifetime. Safeguarding your home against extreme weather, theft and injury liability is critical not only to your financial security, but fundamental to any homeowner’s peace of mind.
Renters Insurance
Renters insurance is a very low risk way to plan against one catastrophe wreaking havoc on your finances.
Consider the following scenarios: What if your TV and laptop are stolen or damaged? What if a fire or flood destroys your belongings and renders you homeless? For a low cost (the average policy in Massachusetts is a couple hundred dollars per year), you’ll have the peace of mind knowing that you have coverage should one of these unfortunate occurrences happen, saving you from credit card debt or emptying your bank account.
Life Insurance
Life insurance is generally recommended for anyone who has people that depend on them financially (children, spouse, business partner, etc.).
Consider your current financial support and what you would be paying for in the future. Purchase enough coverage that compensates for that total amount. There are myriad options from which to choose, and a variety of considerations depending on your unique circumstances. Still, life insurance is almost always a vital component of your healthy financial portfolio. Consult your insurance agent and financial planner.
Disability Income Insurance
While health insurance can cover the medical costs associated with an illness or injury, you may need a source of income if you are unable to work while you recover from such an event.
Disability insurance replaces a preset percentage of your income. Some employers offer their employees company-paid disability income insurance. Those without this option can purchase an individual disability income insurance policy. Look for policies that cannot be cancelled, feature lifetime benefits and as much salary coverage as you can afford. A good rule of thumb is to have total coverage equal to two thirds of your current pretax income.
Long-Term Care Insurance
Medicare pays very little of the cost of long-term care in the United States, and Medigap will not cover custodial nursing home costs. Medicaid will pay for the care only when patients have exhausted all their other assets.
Mortgaging the house, depleting savings and imposing on others are stresses and burdens no one wants to experience. A solid long-term care insurance policy could shield you from that reality. Knowing the policy will always be there is a comfort for you and your loved ones, who will have the resources to do what is best.
