The In’s and Out’s of Family Insurance

It is a question that always gives families pause for concern, as there is never really a right time or a wrong time.

When is a good time to buy insurance?

You may think you don’t need health insurance if you are young and strong, with no known medical problems. Should you get it anyway?

This is only one of the questions facing people as they navigate a complicated insurance maze. Here are some other tips to think about when deciding whether or not to buy insurance.

1. Always Think About Life

If you have reached adult age and are no longer on your parents’ policy, you should think about life insurance of your own. However, single people without dependents may want to hold off. Once you get married, settle down and start thinking about children, that is the perfect time to consider life insurance.

How much life insurance you buy depends on how much you make. If you have arrived at a job where you know you will have a guaranteed salary that goes higher, then you will need to buy a policy that has roughly 20 times the value of a year’s salary. So if you make $100,000 a year, carry a policy worth two million dollars.

Likewise, if you have reached retirement age and do not have any need for assistance – let’s say you either hit the lottery or you invested wisely enough to live comfortably for the rest of your days – then having a life insurance policy would be redundant. Should you pass away, your money, should you choose, will go to your beneficiaries.

2. There’s No Place Like Home

Having a home policy is an important part of owning your own house. You need to insure against terrible acts such as fire, earthquake or tornado affecting your property and tearing it to shreds. However, think about what you need in terms of home insurance. If you have an option built into your mortgage payment where part of your payment goes to taxes and insurance, then you do not need to go any further.

If you have important valuables in your house, check with your company to see if they are covered underneath that policy. If not, then you may want to think about a little extra payment to cover those, or even a small separate policy should take care of the valuables. It is best to play things safe.

3. You Can Drive My Car

Most states require you to have auto insurance before you purchase a car. For items such as deductibles in personal injury and property damage, calculate a deductible you will be able to pay should an accident be your fault and then buy your insurance at that rate. Do not go for just minimum coverage. Buy enough to cover the cost of a car.

Your insurance provider will be truthful to you about what is and is not necessary to purchase for the type of car you own. Check with a company like 21st for a selection of insurance policies at affordable rates.

4. To Your Health

The Affordable Care Act is meant to make sure everyone has some form of health insurance, in order to make rates go down. A potential problem exists here, however. The Internal Revenue Service can force you to pay a penalty if you do not have health insurance. That penalty, even in later years, will be much less than the cost of a health policy.

Many people may choose to simply pay the penalty instead of buying insurance, simply because it is much less expensive. This means, although it wasn’t the government’s intent, it may be in your interest not to buy health insurance if you don’t work for a company that offers it. Time will tell if rates come down or this mandate will be adjusted, but for now it is a viable idea.

Tips like these should help you save money or spend it where you need to do so wisely.

It is the perfect way to insure a good future.

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3 comments

    • Monique (9 comments) says:

      I never wrote insurance in MA, but in the other 40 states, it’s always less expensive for a new driver to be on his parent’s policy. That way he can take advantage of their discounts. The are discounts and lower premiums for multi-car, older drivers, multi-policy households (multiple insurance policies in the same home with the same insurance company), and good driving discounts, for example.

  1. Rosey (973 comments) says:

    We just had a family member pass who didn’t have life insurance. Loving, big-hearted guy that he was, I do have to say no one was surprised because as much as we loved him, we all knew responsibility was never his strong suit. It was a big mess for everyone (his grown children arguing over funeral vs. cremation because he didn’t state his wishes) and we all had to chip in money for expenses. It really wasn’t pretty and made an awful situation even more difficult. I’m a firm believer that you should def. def. def. invest in life insurance if you don’t have it.

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