[dropcap]I[/dropcap]nsurance can give you and your family that extra sense of security in the toughest moments of your life. Each insurance comes with its unique purpose and there are benefits to all types of insurances. But having all the available insurances might not be an option at a time when money is tight. So how can you choose which one to buy?
No one is guaranteed good health forever and even when you are living a healthy lifestyle, you might find yourself falling sick. For health related life issues, there are two types of insurance options: life and health insurance. But you might find that opting for both is a bit too costly for your wallet. As both serve a different purpose and have their unique quirks, it’s a good idea to compare the two and try finding the right option.
What are life insurances?
Let’s start by looking at life insurances. When you take out life insurance, you are essentially preparing for the worst. Life insurance will pay out a death benefit to your beneficiaries if you die prematurely. The good thing about life insurance is that it gives something to your loved ones at a difficult time, meaning that they don’t have to start dealing with money issues at a difficult time. With good life insurance, they can:
- Replace some of your future income loss
- Cover outstanding expenses and obligations such as funeral costs, medical expenses and so on
- Set it aside as a fund for children or spousal retirement
Essentially, life insurance guarantees continuity of finances after death and thus helps make a difficult situation slightly easier to handle from a purely financial perspective. However, life insurance is very situational. It doesn’t really help you during your time of need, for example, during sickness.
What are health insurances?
On the other hand, health insurance is something you take to help you directly with the cost of your healthcare. You pay towards your insurance which in turn will help you cover the cost of medical expenses. These can include things like:
- Doctor visit
- Hospital stays
- Medications, tests and procedures
This will guarantee your medical costs won’t be too expensive and that you are able to enjoy the treatment you need. The big benefit of health insurance is to spreading of cost to look after yourself. When you have insurance, you are slowly paying for the cost of care instead of having to deal with a huge payment at a certain point.
Unlike life insurance, health insurance won’t provide any cover after you have died and you do have to compare health insurance to ensure you find a cover that best fits your lifestyle and budget. The truth is that the wrong type of health insurance might end up costing you money. Health insurances aren’t all alike, meaning that comparison and analysis of the different policies are crucial.
Which one should you buy?
The honest truth is that both insurances are different and offer widely different benefits. That’s why you can’t really say that one is better than the other. In fact, most people would always benefit from having both of these insurances.
However, in a large majority of cases health insurance is the insurance to go for. This is because it guarantees you can avert major financial problems as a result of even minor injuries and illnesses. It can even ensure you continue to stay healthy because you don’t have to worry about the cost of seeing a doctor or getting tests done.
If you do have a family then you do want to consider having life insurance as well. Those with children can get a lot of comfort from the fact that life insurance gives the children a cushion and help the remaining spouse get through the tough times without financial problems burdening them.
In short, insurance needs can depend a lot on your situation and most insurances have benefits that you can’t cover with other types of insurances. Indeed, it’s more important to compare the same type of insurances and check which insurer offers the best policy, instead of trying to choose between life and health insurance, for example. When you compare health insurance, you can also ensure you find the best option to suit your situation but also budget. This can then allow you to have enough room in your budget to also opt for life insurance.
So, when it comes to life and health insurance, the key is to consider your life situation and the benefits of each policy. Don’t forget to compare policies of the same type to find the best option for you and if you can, opt for both!
