We commonly refer to the importance of business insurance, but insurance isn’t only limited to liability and property. Whether you’re an employee, business owner, or homemaker, there are a plethora of other insurance products you should look into.

This article discusses four types of insurance policies everyone should have to mitigate the unfortunate circumstances that come in life.

Life insurance

Life insurance provides a pre-determined death benefit to the beneficiaries of a person after they die. This money can compensate for a family losing a source of income due to death or pay for funeral and other expenses that arise from dying. Life insurance, therefore, mitigates the risk that you may pass away and cause financial hardships to your family. Like all insurance products, it provides peace of mind. In case you’re gone, you know your family won’t have to deal with any further financial hardship.

There are generally two types of life insurance: term and whole life insurance. Term life insurance provides coverage for a specified number of years. For example, a policy could state if you pass away within the next twenty years, your beneficiaries will receive $500,000 as a death benefit. This is great if you only need coverage for a specified period. Twenty years from now, your kids may be financially independent, and your mortgage may be paid off. As a result, your death may not result in as significant of financial hardship to your family.

Whole life insurance usually costs more than a term policy but lasts for the entirety of your life. It’s common for individuals to purchase whole life insurance to pay for their own funeral expenses or as a way to just provide for the next generation.

Critical illness or disability insurance 

If you can no longer earn an income due to an illness or disability, your life insurance won’t cover you. That’s why critical illness or disability insurance is vital. A car crash or freak accident may not kill you but still cause enough of an injury that you can’t return to work temporarily or permanently. Critical illness or disability insurance, in this instance, can help replace the income that you would’ve earned if you could still work.

This type of policy is more critical to those whose jobs require them to be up on their feet like contractors. Unfortunate circumstances such as paralysis from the waist down may allow an office employee to continue working. But a contractor would permanently be out of their role due to the job’s physical demands.

Home or renters’ insurance 

Home insurance protects you if your home is damaged or destroyed and pays for any rebuilding costs up to the policy’s limit. Your policy can additionally cover the contents of your house in case of a robbery or burglary. Content insurance is also available for renters’ insurance.

Home and renters’ insurance can additionally protect you from liability. For example, your home or rental may catch on fire and damage a neighbor’s property. As a result, they sue you. In this case, home or renters’ insurance can cover any legal fees and damage awards. Lastly, both policies can cover your living costs if your home or rental needs to be rebuilt. If you need a hotel or short-term rental as your roof gets replaced, your policy will cover the cost of such accommodations.

Auto insurance

If you drive, you can’t skip out on auto insurance in Canada. It’s the law. But auto insurance comes in handy as it protects you and your car from damages due to your own fault or something out of your control. So, if a deer jumps in the way in the middle of a country road and you accidentally hit it, you won’t have to worry about replacing the entirety of your car. Your car insurance will handle it.

If damage to your vehicle is due to someone else’s negligence, you can usually tap their insurance instead, which is why auto insurance is mandatory. This is also true if you damage another person or car with your vehicle. In such a situation, your auto insurance can cover the cost of any damage awards or legal fees.

Business insurance is vital if you run your own business. But it’s not the only type of insurance out there. Make sure you understand what products are available to reduce the risks in your life!