6 Types of Insurance I'd Never Go Without

Do other consumers need these kinds of coverage too?

When it comes to insurance, I tend to want more coverage rather than less. Insurance is a pretty affordable way to transfer the risk of big losses and protect my assets. Because I want to minimize the chances of a financial catastrophe if something goes wrong, here are six kinds of insurance coverage I will always make sure to buy. 

1. Health insurance

Health insurance is the most crucial type of insurance I'd never pass up because this type of insurance literally helps me keep myself and my loved ones alive. I never want to worry about paying for the costs of treatment or doing without care, so I make sure to get a comprehensive health insurance plan every year. 

2. Automobile insurance

Car insurance is another critical kind of insurance. It's required by law, for one thing, and I'm not interested in having my car impounded and facing fines if I get pulled over and caught driving without coverage. 

I also buy more auto insurance than the minimum, mainly because I want additional protection. I buy collision and comprehensive insurance so my car is covered against theft, vandalism, falling trees, incidents with animals, accidents that are my fault, and a variety of other calamities. I also buy more liability coverage than is mandated so if I cause a crash and get sued, I won't have to pay out of pocket. 

3. Life insurance

Both my husband and I also have life insurance and we won't go without it -- at least not for many years. We have coverage in place because we have kids and want to make sure they are provided for if something happens to us. And because our lives and expenses are built around being a two-income household, we have coverage to make sure that if one of us passes, the other could still afford to cover the bills. 

Now, technically someday I will go without life insurance once we are old and essentially self-insured because we have enough money in the bank and no further dependents. But that won't happen for decades, so life insurance still deserves a place on this list. 

4. Homeowners insurance

I'd never go without homeowners insurance either, even on my vacation home which we paid for in cash so no lender is requiring coverage. I don't want to lose the entire value of my home if something goes wrong such as a fire. And I don't want to have to pay out of pocket to replace all my possessions or to cover injury costs if someone is hurt at my home and sues me. 

5. Flood insurance

My vacation house in Florida is near a small lake, so I have flood insurance on it. I've made this choice even though I have no lender to require it because my standard homeowners policy excludes floods and I want to make sure I'm covered against any water damage that occurs. 

6. Umbrella insurance 

Finally, I have umbrella insurance because this policy provides additional liability protection on top of my other policies. If a claim is made against me that exceeds my car or home insurance limits, my umbrella insurance will pay out so my personal assets are not at risk. 

While paying for all this insurance costs thousands of dollars per year, it's well worth it to protect against catastrophic loss that could result if I dropped any of these important types of coverage.