4 Insurance Policies You Can’t Do Without
While insurance may seem like a luxury, there are some ‘essential insurances’ you simply cannot live without.
Published: Monday, October 31st 2016
Before this sounds like a sales pitch, and you click away, stop to think about what insurance does for you.
The purpose of insurance is to transfer risk. This is done by the insurer paying a percentage of the total costs incurred, and is the "life jacket" you desperately need in times of emergency.
Why a life jacket? We all avoid talking about insurance or taking cover we know we need, until something happens. Leaving us completely unaware, unprepared, and having to fork out thousands of rands.
Unexpected expenses often lead to us drowning in debt as we can't afford the damages.
If you think you can barely afford to get through the month, let alone insurance, think again. Insurance providers are constantly trying to perfect the art of insurance as well as making it more accessible to a wider market.
Here Are The Four Insurance Policies You Can't Live Without
1. Home Insurance
Home insurance is for those unforeseen emergencies where your house is damaged in a flood, hail storm, or fire, and you need to repair immediately. It is also to safeguard all your earthly possessions, namely, your household contents.
You can pretty much insure anything. So, if you feel you need to
insure that crystal skull you have in your man cave - do it. Not only will you be financially compensated, should any items in your policy be stolen, you can have the piece of mind that, should you lose anything of value, you will be able to replace it.
This includes a quick turn-around for when the geyser breaks at 4AM in the morning and you need it replaced pronto. There are three types of House Insurance: Household Contents, Building or both combined in the form of Combined Buildings Insurance.
TIP: Keep a log of all your possessions with pictures of each and a description. This can prove indispensable when you need a guaranteed replacement cost.
2. Car Insurance
You hear the pitch, "Never drive around uninsured" and scoff and say, "yeah, you're just after my money". The reality, however, is a lot more ominous when an accident renders your car a
write-off, or a simple dent saddles you with a hefty quote.
There are three types of car insurance:
The best type of car insurance is one that has sufficient liability coverage or that protects you against anything you may have caused in an accident.
- Third Party
- Third Party, Fire & Theft
3. Medical Insurance
This covers you against any emergency and unforeseen healthcare expenses. This means you can use it in conjunction with your medical aid, as a gap cover, for instances when your medical aid schemes fall short.
It cannot be said enough how important medical insurance is. Falling and breaking your leg and needing urgent surgery is no cheap expedition. And, it's even worse in the case of a dread disease.
Case study: had a brain tumor that was operated on and was thought to be successfully removed. Months later he experienced searing back pain and constant vomiting which lead to dehydration and hospitalisation. It was found that the cancer had spread to his spine.
He is now faced with medical costs amounting to over R677 000. Saunders is a newly engaged, 32-year-old male who is unlikely be able to afford this on his own.
TIP: Make your health a priority today by taking out health insurance that fits your lifestyle.
4. Life Insurance
This type of insurance has both your interests and your loved ones at heart. Life insurance is a policy that
insures after you have departed. Your family will not be left to foot a financial bill they could never cover on their own.
This may be to cover the costs of the burial and funeral arrangements, the mortgage on a house, or simply to carry on living the type of lifestyle they are used to.
The types of insurance mentioned above are in no way gimmicky or contrived as they respond to all individual's basic needs. They can thus be termed as "essential insurance" and are types of financial coverage one should never wish to be without.