A single costly event, emergency, or accident can eradicate the savings that you spent years accumulating. One way to protect your assets from the unexpected is to make sure that you are properly insured. If you are unsure about your coverage, a financial adviser can help you understand what products are beneficial for your situation. Check out a few insurance products that can help shield your assets, and contact a company like USAlliance for more tips.
1. Long-Term Care Insurance
If you've spent your entire working life saving for retirement, your hope is that some of the funds will go towards activities that you want to participate in during your retirement, such as traveling. Or, you may want to preserve your family home for your children.
However, if you develop a chronic medical condition or suffer a life-changing illness, this can quickly wipe out your retirement savings or home equity, obliterating your vision for your retirement. Long-term care insurance covers expenses that regular health insurance policies don't pay for, like expenses for in-home care or an extended stay at a nursing home. Without long-term care insurance, you may have to deplete your savings and liquidate your assets to pay for the care you need.
Premiums for long-term care insurance vary based on multiple factors, including your age, gender, and health. It is important to buy long-term care insurance before you actually need it; by this point, it is difficult to find affordable coverage.
2. Pet Insurance
If your pet suffers an injury or is diagnosed with an illness, it won't take long for your vet bills to erode your emergency fund. Preserve your hard-earned savings while providing your pets with top-notch care by purchasing pet insurance.
Pet insurance typically has a deductible that you have to pay before your policy kicks in. Coverage levels vary based on your policy and the procedure. Some policies also cover preventative care (like vaccinations and an annual check-up), and you do need to purchase a policy for each pet.
3. Guaranteed Asset Protection (GAP) Insurance
When financing a vehicle, it is a smart idea to purchase GAP insurance. If your vehicle is totaled, your insurance policy will not pay more than your vehicle's value, even if your loan on the vehicle exceeds the value. GAP insurance covers this difference. For example, if your car is worth $20,000 and your vehicle loan is for $23,000, your auto insurance will cover $20,000 and the GAP insurance will cover the remaining $3,000.
It is common for an individual who finances a vehicle to owe more than the vehicle is worth at some point during the vehicle's lifespan, especially when purchasing a car with no or a small down payment.