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The Basics of Insurance

What is insurance, and why do you need it? Learn about the importance of including four main types of insurance in your financial health toolkit.

While we can't prevent unexpected events from happening, we can plan ahead and help protect what matters most to us and those we care about. Insurance can cover a range of unexpected car, home or health expenses, making it an important tool in your financial health toolkit.

There are five core types of insurance you should consider and review regularly to protect yourself and your family's future:

  • Health Insurance protects you (and your spouse or children) from unexpected, high medical costs. With health insurance, you typically get free preventive care, like vaccines, screenings and some check-ups.
  • Homeowner's or Renter's Insurance provides financial protection against losses due to theft, disasters like fire or water damage and accidents on your property.
  • Short & Long-Term Disability covers you and your family if you were to become seriously ill or injured.
  • Life Insurance helps  your family and loved ones when you pass away. If someone relies on your income, you need life insurance.
  • Auto Insurance helps cover the repairs, health care costs and legal expenses that can be associated with collisions and injuries. Auto insurance is also a legal requirement in most states to drive a vehicle.

Get Started with Insurance

Some forms of insurance, such as health and life insurance plans, may be offered through your employer. For other types of insurance, including homeowner's or renter's insurance and auto insurance, you'll typically need to choose and purchase a plan on your own. Take the time to think hard about what you need and value most in life. The next step is to research and compare insurance options with your needs and budget! 

For more tips on planning & protecting, visit our Financial Flexibility and Freedom page​.