Different Types of Insurance Policies

Researching different kinds of insurance can be overwhelming. How do you differentiate between the main types of insurance and, more importantly, how do you know which ones you need? As a trusted insurance advisor, Venture First Advisory knows that it can be hard to figure out the benefits of each kind of insurance policy. This guide gives a brief overview of each type of insurance, so you can determine the insurance that you need now.

Life Insurance

Life insurance is one of the most important types of insurance to invest in at any age. If you pass away, you may leave debts, a mortgage, and dependents who will no longer have your income to depend on. A life insurance policy will provide your family with the means to pay off your debts and carry on without your income.

You can choose between Term Life Insurance – coverage for your family without any return on investment for you – and Permanent Life Insurance, which features a higher premium but allows for a return on investment. You can learn more about the different types of life insurance policies here.

If you have people who are financially dependent on you, it is advised that you invest in a life insurance policy. The younger and in better health you are when you apply, the less you will pay each month.

Health and Dental Insurance

Health care benefits cover any medical costs, sometimes including dental coverage and prescriptions, that you might encounter. If you work for a company, you likely have health benefits included. However, if you’re self-employed or own your own small business, you want to be able to provide health coverage for your employees, family and yourself.

Health, dental and drug plans are essential to anyone who is self-employed or running their own small business. You also may want to purchase a health and dental policy to provide more coverage in addition to your existing policy from your employer.

Critical Illness Insurance

With advances in medical technology, more people than ever are surviving critical illnesses, such as cancer or heart disease. This doesn’t mean that surviving is easy – often, people who face these illnesses must take time off to focus on recovery. Unfortunately, this doesn’t come without a significant cost.

When you invest in critical illness insurance, you will receive a lump payout should you become ill so you can focus on recovery without worrying about falling into debt. Critical illness insurance doesn’t have any limits to what it must be spent on; you can use it to cover bills, support your family member who may be playing the role of caretaker, or try an experimental medical treatment. The aim is to make your life easier during the recovery period. You can learn more about critical illness insurance here.

Disability Insurance

Much like critical illness insurance, disability insurance ensures that you are taken care of should you become disabled by an accident or illness. If you are rendered unable to work, disability insurance replaces your income – either in the short or long term, depending on the specific policy – so that you don’t have to worry about debts if you become unable to work.

If you work a dangerous job that puts your safety at risk, disability insurance makes it so that you are financially covered before you receive any claims. This is especially important for those who have dependents that rely on your income for their well-being. However, anyone can become disabled in the short or long term without a dangerous profession. Some women may need to go on early maternity leave and will need disability insurance to cover their costs before giving birth. Because you never know if you’ll need to take time off work, this is an important insurance policy to consider.

Mortgage Insurance

Mortgage insurance is a unique type of insurance because it benefits whoever is lending you money – usually the bank – more than it benefits you financially. Mortgage insurance guarantees that should you have to default on a loan, that the lender will be paid back their amount in full.

So how does this benefit you? When lenders feel safe lending you money, they’re more likely to approve your loan. If you have less saved for a down payment, or you’re less financially secure, mortgage insurance makes it so that you can purchase a home faster.

Travel Insurance

In Canada, we are lucky to have basic health care coverage from the government. However, this is not the case when we leave the country to go travelling. To enjoy a vacation with a clear mind, it is essential that you purchase a travel insurance policy before leaving the country.

Travel insurance can cover any small to large medical costs that you might come into while you’re abroad. It is convenient for small costs, such as medical attention that you might need if you get food poisoning. For bigger emergencies, travel insurance can keep you from debilitating debt, as other countries can have overwhelming health costs. No matter what you may encounter while travelling, travel insurance gives you the peace of mind that you’re going to remain healthy on your trip.

Funeral Insurance

Funerals are expensive. From burial costs to renting a space, to even catering, there is a lot to consider after you pass away. You don’t want your loved ones to be burdened with additional financial considerations while they’re in a mourning period. This is why some people choose to add funeral insurance to their existing life insurance policies.

Funeral insurance is paid out in lump sum, much like critical illness insurance. This gives your loved ones the freedom to choose what they would like to use the money for. While most life insurance policies will provide your family with money after you die, it might be prioritized for things like paying off your debts or other expenses; funeral insurance will take care of any funeral-specific costs.

Let Us Help

Now that you have more clarity about the different types of insurance policies, let us help you find the right one for you – Book an appointment with Venture First Advisory today. Our experienced advisors can help you find the right insurance provider at a price that works for you.