Most people have at least one type of insurance, but it does cost money. It is an expense that some people might consider cutting back on, perhaps by cancelling their policies. It is worth considering whether the insurance policies you have are worthwhile.
Insurance is to cover the costs of certain events. For example, car insurance will cover cost of repairs to a damaged vehicle or pet insurance will cover vet bills. However, there are lots of different types of insurance and some will be better than others. Not only will they vary between insurers, but some will actually be more useful for you to have than others. Below are a few common types which will be explained in more detail.
If you are a driver, then it is illegal to drive without car insurance. This means that you will have no option but to take it out. However, there are different types of car insurance and it is worth finding out about them. There is a minimal insurance, for legal purposes which will cover the costs of damage you cause to property in an accident apart form your car and then there are many add ons which can include damage to your own car, break down cover (which is often bought separately), driving for work and all sorts of other things. The best approach is to consider what cover you think you need. If you drive with work they will often insist your insurance covers you, if you drive a lot you may not want to risk not having break down cover, if you rely on your car then you might want to make sure that the cost of fixing it is covered by your insurance. However, be careful not to have too much cover as this will cost you more money, so just get the minimum that you feel you need. The reason there are different types and levels of cover is because we have different needs.
If you have a mortgage then you will need to take out building’s insurance on your home as part of your agreement with your lender. If you own the home outright you may also want cover in case the house is damaged by fire, floods etc, but do make sure you check exactly what cover you are getting with the specific policy that you are considering. You will often find there is a choice of adding accidental damage, which could be worth considering as well. If you are renting then you will not need to think about this insurance.
This insurance will cover the items that you own. Whether you are renting or in a home you are buying it is worth considering. It could cover the cost of replacing items after a theft, fire or from other types of damage and it may cover accidental damage and damage outside of the home. These policies can vary a lot and it is worth thinking about what cover you think you need.
If you have a mortgage then your lender will insist you have life insurance to cover the cost of the mortgage should you pass away before it is paid. You can also get cover to provide money for your family when you die. It is worth thinking about whether this is something that you really need. If you start to put away the amount you would be paying in a policy, into a savings account each month, you could quickly accumulate quite a lot of money which will allow you to be able to have something for them to have and it will not just be going to an insurance company. However, it may be hard for you to do this without being tempted to spend it. If you have some money behind you, then this could be enough for your family, without needing insurance, so think about whether it is something that you really need.
Some people like to take out health insurance. It can be a way of getting treatment more quickly than waiting for the NHS. However, it is worth considering whether you will get back more than you pay in. Sometimes the insurance only helps towards the costs and will not cover all of it, so it is worth thinking about it. Dental insurance is a separate type of health insurance. It tends to help spread the cost of treatments through the year rather than having to pay all in one go. Dental treatment is only free for those on very low incomes and so most people would expect to pay. However, if you can find a national health dentist you will pay a lot less than if you go to a private clinic so it could be worth considering doing this and saving money, rather than paying the insurance.
If you have pets then you may get out insurance for them. This will help towards the costs of vet bills. So, whenever you pet needs treatment, whether it is regular worming treatment or more serious illnesses, the insurance will help out. The cover varies and so some may cover everything and others may provide money towards treatments. It is worth looking into the different types.