It might feel like almost every part of your life is insurable these days. But insurance is only really needed if you stand to lose lots if the worst happens.
Here’s our run-down of the top seven types of insurance policy that most people need at some point in their life, as well as a little bit about how they work.
1. Home insurance
This will cover the cost of repairing or rebuilding your property in the event of a fire, storm, flood or any other disaster. Often called buildings insurance, it’s a legal requirement if you own your own home. While it won’t protect your home from wear and tear, it’s important to remember that repairing your home can be very expensive, so it could save you thousands of pounds.
2. Contents insurance
This will cover the cost of your possessions if they’re lost or damaged and can save you lots of money if your items are stolen. You could also be protected outside of the house. But, again your items won’t be protected from general wear and tear.
3. Car insurance
There are three types of car insurance; third party, third party fire and theft and comprehensive. Third party protects other people involved in an accident or damage to someone else’s car; third party, fire and theft covers for repairs or replacement if your car is stolen or set on fire; and comprehensive insurance covers damage to your car and injury to you as well. If you want to drive on UK roads, you must have at least third party car insurance.
4. Travel insurance
Travel insurance can cover emergency medical expenses, lost or stolen bags, delayed, cancelled or shortened trips and if you’re sued for damaging property or causing injury. If you have a pre-existing medical condition or plan on doing any extreme sports, it’s likely that you’ll need extra cover.
5. Life insurance
This type of insurance will pay a lump sum or regular payments if you were to die. It could be a good idea if you have family members or children who depend on your salary for mortgage payments and living costs.
6. Pet insurance
Pet insurance covers for the cost of any treatment for your pet except for annual jabs, neutering, and spraying. If you’re unable to afford vet treatments, pet insurance could be very useful. Vet bills can be very expensive but if you have an old pet or one that has a medical condition, monthly premiums could be more expensive. So do your sums.
7. Dental insurance
While dental insurance doesn’t cover for cosmetic work, it does protect against routine check-ups, general dental work, accidents and emergencies.
Things to think about when buying insurance
- Shop around for the best deals and compare prices.
- Look at whether the policy covers everything you need.
- Answer all your insurers’ questions accurately. Providing incorrect information could result in your insurance being invalid.
- Keep up with your monthly payments to avoid your insurance being declared void.
While insurance may be an annoying monthly outcome, it’s one of those things that you’ll wish you had when you soon realise how expensive life can be in the event of damage, emergency or accident.