Content Attributes
Making a budget can help you manage your finances and avoid overspending. It’s also an effective way of identifying unnecessary expenses. That can help you add to your retirement fund or save to buy expensive products, such as a new TV or car.
Whether you’re reviewing your budget to find ways to cut costs or moving out and assuming responsibility for insurance payments for the first time, you may be wondering if you need both home and auto insurance. Read on to learn what these insurance policies cover, how you can find home and auto insurance, and whether you may need other types of insurance plans.
What is auto insurance?
As of 2019, there were more than 275 million registered vehicles in the United States. It’s illegal to drive without car insurance. Automobile insurance covers your vehicle. Suppose you’re stopped at a red light and rear-ended. The at-fault driver’s insurance policy would pay for the cost of repairs. However, if your car’s stolen, you may need your auto policy to cover replacement costs. Depending on your auto policy terms, it covers the cost of storm damage if your car’s struck by a tree limb or destroyed in a flood.
Auto insurance policy costs vary based on the age and make of the vehicle, your location, and the type of coverage you choose. Suppose you pay cash for your car. Then, you can determine whether you need collision and comprehensive coverage. However, if you take out a car loan, acquiring collision coverage may be one of the loan conditions.
What is homeowners insurance?
Over 82 million homes in America are occupied by their owners. Homeowners insurance is optional if you own your home outright; however, lenders require homeowners to have this insurance while making mortgage payments. Your homeowners policy covers the cost of repairs if your home’s damaged. It also covers the cost of rebuilding if your home’s destroyed.
You can use your homeowners insurance to cover expenses caused by storm damage from hail or lightning. Homeowners insurance also pays for repairs if thieves or vandals damage your home. Property owners also use their home insurance if their home’s damaged by fire or smoke. Your home insurance plan covers the costs of repairing or rebuilding your hose and replacing possessions, including furniture and clothes.
Do you need an auto and homeowners insurance policy?
Anyone who owns a vehicle must have auto insurance if they plan to drive the car. People who own homes must have home insurance if they have a mortgage. It’s also a good idea to have homeowners insurance to protect your financial investment in your property.
Thanks to the internet, it’s never been easier to find auto and home insurance. Insurance locator sites provide tools and information to simplify the process. Identify the kinds of insurance you need and answer the prompt questions about where you live and what types of insurance you currently have. The tool uses your data to compile a list of insurance companies in your area and provides contact information for the insurance companies. You may qualify for a multi-policy discount when you bundle your home and auto insurance policies.
What other types of insurance policies should you consider?
There are several types of insurance policies, and you may need more than home and auto insurance to protect yourself from financial losses. Suppose you own a business. A professional liability policy covers lawsuit costs. Whether you’re an employer or employee, you’ll benefit from having health insurance to cover your medical expenses.
You could also benefit from having flood insurance. Home insurance policies don’t cover repairs or replacement costs after a flood, making it crucial you invest in flood insurance if you live in an area prone to flooding. You should also consider acquiring a life insurance policy that will pay your family a death benefit if you pass away.
People who own vehicles and homes should have auto and home insurance. You may be able to reduce your insurance costs by bundling policies. You may also need liability, flood, or life insurance.