Get insurance for emergencies

In addition to an emergency fund, having adequate insurance can help during a crisis. Insurance coverage helps you mitigate your losses and is a form of risk management. Well-planned insurance coverage can limit the impact to your emergency fund.

Some insurances to consider:

• Auto insurance to offset costs associated with wrecks or vehicles that break down.
• Property or renters insurance to help in case of property damage, theft and even personal liability.
• Health insurance to protect you, your family and your income in case of medical needs.
• Disability, life and long-term care insurance to safeguard your financial future in case of illness, injury or death.

When you estimate your emergency fund needs, be sure to make an entry for your periodic insurance premium payments. If you know the costs for your typical copays and deductibles, you can set aside emergency funds for these as well. For example, if you know the copay on a prescription drug each month, set aside emergency savings for at least three to six months of copays. Use this course on Insurance Basics Links to an external site. to learn more about different insurance coverages, associated costs and making a claim.

 

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