Insurance is not something we enjoy paying. In most instances, we spend tens of thousands of dollars over a lifetime paying for insurance we hardly ever use. But it’s when you need it most that having insurance can change your life. If you aren’t insured and you’d like to understand what insurance you really need, read on to see what the benefits are for you and your family.
The absolute essentials
Choosing the right insurance cover is a personal decision that will depend upon your circumstances. There is no one size fits all approach when it comes to insurance and what’s right for someone else might not be best for you.
To help you decide what cover is important, we’ve outlined 3 insurances that we think are the absolute essentials. The amount of cover you choose for each or any of these will again depend on your personal situation.
1. Life Insurance
Life insurance protects the family with a lump sum amount paid out on the death of the person insured. It can be used by the family to pay off the mortgage or cover everyday cost of living expenses. Essentially, this insurance will replace the family income so that they can maintain their quality of life.
Most people take out life insurance when they buy a home. That way should something happen to one person, the other won’t be left with a mortgage to pay. Similarly, when couples start a family - children who will rely on the care and income of their parents for a number of years - having life insurance in place would ensure that the family is not left destitute if one of the income earners was to die or become terminally ill.
There are other types of cover that can be added to a life insurance policy including trauma (critical illness) cover that provides a lump sum in the event of certain illnesses; disability insurance that covers permanent disablement; income and mortgage protection insurance which covers your income and mortgage should you be unable to work.
2. House and Contents
Home insurance covers your home, the physical property: If your home is destroyed or damaged, this insurance will cover a rebuild or repair. If you own your own home, it’s vital you insure it. In fact, most lenders will require you to have insurance cover in place when you apply for a mortgage.
Contents insurance covers any damage or loss to the things in your home. It also covers third party damage to someone else’s belongings so a good idea to have if you’re renting.
Most insurance companies will ask you to set a maximum sum that the insurer will pay out in the event of a disaster – the sum insured amount is a capped limit of what you can claim. It’s important you calculate the value of your house and total contents correctly to ensure you’re not underinsured. Get in touch with one of our insurance advisers about your insurance cover to find out if you are adequately covered.
3. Vehicle insurance
Comprehensive vehicle insurance is the most common insurance, covering loss, theft or damage to a vehicle you own. It also covers accidental damage to other cars that you may damage in an accident. Third party insurance is a cheaper option covering damage to other vehicles in an accident but not your vehicle.
While it can be tempting to save money by not insuring your car – especially if it’s a cheap run-around and not worth much – insurance is worth its weight in an accident where damage to the other vehicle or vehicles far exceeds what you could afford to pay yourself.
Shop around for cover
Shopping around for the right insurance cover can be time consuming, but it’s certainly worth doing. When you work with a Mortgage Express insurance adviser, we do the shopping around for you. We’ll help you compare insurance policies and explain all of the fine print details that can be hard to understand. In short, we’ll help you make the best decision when it comes to finding the right insurance cover for your situation.
Contact a Mortgage Express insurance adviser to discuss your insurance needs by completing this online form – one of our team will be in touch shortly.
The information contained in this article was prepared by Mortgage Express Limited. While every care has been taken to supply accurate information, errors and omissions may occur. Accordingly, Mortgage Express Limited accepts no responsibility for any loss caused as a result of any person relying on the information supplied in this article.
This article does not constitute regulated financial advice to retail clients. It may not be relevant to individual circumstances. Nothing in this article is, or should be taken as, an offer, invitation, or recommendation to buy, sell, or retain any investment in or make any deposit with any person. You should seek professional advice before taking any action in relation to the matters dealt within this article.
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