Top 3 Types of Insurance You Need (and 2 You Don’t)

Some people think that insurance is a waste of money, or too expensive. However, it’s much more expensive not to have insurance if you need it.

We see many clients who are forced into bankruptcy because they had an emergency and didn’t have insurance to help pay for it.

Here are 3 types of insurance that everyone should carry:

  1. Homeowner’s or Renter’s Insurance. If you have a mortgage, you’re legally required to carry insurance. If your house is paid off or if you are renting, you should still have insurance to protect your home and belongings. Homeowner’s insurance can be a lifesaver if something happens to damage your home. Renter’s insurance is very inexpensive, since it only covers your belongings. Your landlord carries a policy to cover any damage to the building.
  2. Life Insurance. If there are people dependent on you or your income, you should have life insurance. Life insurance isn’t intended to replace the person who died, but it does lighten the financial burden for the rest of the family. In Central New York, funeral costs alone usually range from $5,000 to $10,000. Add that to the loss of your income to your family, and a premature death without life insurance can leave the surviving family members in serious financial trouble.
  3. Health Insurance. Medical bills are the number one cause of bankruptcy filings. You need health insurance to protect yourself in case you or someone in your family has a major medical need. Don’t add the stress of unpaid bills to the stress of dealing with a major illness.

Those 3 types of insurance are necessary and can prevent a lot of financial stress. Here are 2 types of insurance you don’t need to waste your money on:

  1. Credit Insurance. Credit insurance pays your loan or credit card bills in case of death, disability, or other situations. Sometimes it pays off the balance, sometimes it pays only a portion. This insurance is very expensive, and unnecessary. If you already have life insurance, your bills will be taken care of if you die. Credit insurance provides a bigger benefit to creditors than it does to you.
  2. Pet Insurance. Instead of paying a pet insurance company, set aside some money every year to care for your pet. Most pet insurance policies don’t ever pay out more than the cost of the premiums. You’re better off creating a savings account and paying yourself what pet insurance would cost—that way, if your pet doesn’t get sick, you can spend the money yourself.

Insurance is a necessary part of a secure financial situation. If you ever need it, you’ll be so glad you have it!


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