The Essential Insurance Checklist for Millennials
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Whether you are a millennial born in the early 1980s bordering on Gen X, the mid-1990s bordering on Gen Z, or you fall somewhere in between, you probably need some type of insurance policy. In fact, you probably need more than one type of insurance.
Here’s the essential guide to finding the right kind of insurance with the coverage that you need as a millennial, whether you’re pushing 40 or you just turned 25.
The insurance types covered in this article include:
- Homeowners, renters, and condo insurance
- Insurance riders for high-value items
- Car and motorcycle insurance
- Life insurance
- Pet insurance
Home, renters and condo insurance: Insurance for where you live
Whether you are a homeowner or renter, your living space should be insured. The obvious difference between homeowners insurance and renters insurance is that one type insures a property that you own (or have a mortgage on) and the other type insures a property that you’re renting from someone else. If you own a condo, there is a different condo insurance policy that you might need as well.
There are other differences between home and renters insurance, too. Houses tend to be physically larger spaces with more room for your personal items, so coverage for personal property may have different limits.
Homeowners insurance will cover repairs to the exterior of the building in which you live in the event that it becomes damaged by a named peril, such as a tornado. However, if a tornado were to hit the apartment building that you’re renting a unit in, it would be the landlord’s insurance that would cover repairs to the exterior of the building. Your renters insurance would cover losses incurred if there were any damage to your personal items inside the apartment.
How to shop online for homeowners or renters insurance
Whether you’re looking to get a homeowners insurance policy or a renters insurance policy, there are some basic steps to take when shopping for them online.
- Make an estimate of how many possessions you have. The value of your personal property will affect your deductible and how much coverage you need. As a result, you’ll need an estimate before you start shopping and comparing. As long as you’re estimating, this is probably a good time to develop a personal property inventory. Whether it’s a list or photos, it’s good to have a record of what you own.
- Make a separate list of high-value items. There are things that an insurer may not cover as part of your general personal property. Typically, anything that is of higher individual value may be excluded from a general policy, and you’ll need to purchase a personal property rider. Read more on this coverage below.
- Consider where you live. You might need to purchase additional riders if they make sense for your location. Earthquake insurance is one example. Most homeowners insurance policies and renters insurance policies exclude earthquakes and earth-movement events such as sinkholes from their standard policy. If you live in an area with known fault lines or sinkholes, you might want to purchase additional coverage. The same holds true for flooding; if you live in a flood-prone area or near water, you might need to purchase flood insurance.
- Figure out how much you can afford to replace your items out of pocket. If and when you need to make a claim, you’ll be responsible for paying your deductible before the insurance company covers the remainder of the cost, if the claim is approved. If you’re just starting out and don’t have a strong emergency fund yet, you might want to go with a lower deductible. However, keep in mind that this means that your premium will likely be higher. If you can afford to pay a higher out-of-pocket expense if something were to happen, you can choose a higher deductible and likely have a lower premium. Consider this carefully since choosing a high deductible for a lower premium will save you money on your insurance, but it could leave you in a bad spot if you ever have to make a claim.
Once you have the information listed above, start your research by comparing companies online. Learn more about top rated companies in your zip code (and state) by visiting Clearsurance’s rankings pages for home insurance, renters insurance, and car insurance. There are also helpful guides for digital life insurance companies and pet insurance.
Personal property riders: Insurance for your high-value items
As mentioned above, policies for personal property will typically exclude coverage of your high-dollar items. You might think that none of your items qualify, especially if your home or apartment is full of hand-me-downs.
However, take a closer look around and imagine having to replace each item. Pretty soon you may discover something that should be covered by a personal property floater or valuable personal property rider. Electronics and jewelry are two categories that millennials shouldn’t overlook when buying insurance for valuable items. Engagement rings, expensive laptops, cameras, podcasting equipment, and drones are all items that would be expensive to replace if your policy excludes them due to their high cost.
Car and motorcycle insurance: Insurance for your ride
Unless you depend solely on public transportation, you’ll want to insure your vehicle. Whether you drive a car or ride a motorcycle, insuring your transportation isn’t just important, it’s likely required. In almost every state, car insurance is mandatory. And, if you’re still making payments on your vehicle (car or motorcycle), your lender will likely require you to have coverage.
When looking for car insurance, make sure to shop around and get quotes from at least three different insurance companies. Comparing car insurance quotes can help you find the best policy for your needs and cheap car insurance. Make sure to evaluate the cost, coverage offered, customer service, and other aspects of all auto insurance companies that you get quotes from. You can also look at the best and cheapest car insurance companies in your zip code.
Life insurance: Insurance for… you
Life insurance is protection you can purchase for your family. The purpose of life insurance is that, if you were to pass away, your policy would help your family recover from the loss financially.
Millennials with families should absolutely consider life insurance for one big reason. When you are young and healthy is exactly the right time to purchase life insurance, because the cost will be lower. It’s also when it could make the biggest difference for a young family. If you are married and the loss of your income would cause significant financial hardship for your spouse, you should look into purchasing life insurance.
There are many options out there for life insurance for millennials, and now—while you are young—is the ideal time for you to find a policy that is affordable.
Pet insurance: Insurance for your furry companion
The Insurance Information Institute estimates that 67 percent of US households (approximately 85 million families) own a pet. Companion animals account for a vast amount of spending in America. The American Pet Products Association annual report stated Americans spent more than $72 billion on their pets in 2018.
As pet healthcare has become increasingly sophisticated, costs have risen too. For many, pets are considered family members and the quality of their care reflects this status. Pet insurance is coverage to consider, given the potentially high cost of veterinary care, especially in an unexpected emergency.
Insurance for your side gig
Many millennials are taking on side gigs, whether it is to make ends meet or to follow a passion. This is all well and good until you need to make a claim and discover that your homeowners insurance won’t cover a damaged laptop used for your home business or that your car insurance won’t cover an accident that occurred when you were driving for a ride-sharing service.
If you are doing any kind of freelance or independent work out of your home, it’s very important to look into home business insurance. Most standard policies for your personal property or vehicle will specifically exclude damage that happened during business use.
No matter what type of insurance you need, you should research your options before purchasing policies. Remember that discounts are likely available if you’re purchasing multiple types of policies from one insurer, so a good step to take is to ask your current insurer if they offer any of the types of insurance listed above.
Visit the top-rated insurance recommendations in your zip code for home insurance, renters insurance, and car insurance where you’ll discover the best and cheapest insurance for your needs based on more than 150,000 customer reviews. Top insurance providers include Lemonade for home and Progressive for auto.