Different Types of Insurance Coverage Everyone Over 20 Should Have

It’s finally come: the day your parents took a long, hard look at your 22-year-old self and said, “You’re off the insurance. Start shopping around.”

Anyone who has tried to read through insurance paperwork knows how complex it can be.

What’s a premium? What’s my copay? Is this a good insurance plan? Does this even cover me?

And that’s not even starting on all the different types of insurance.

We know it’s complicated, which is why we’re here to help you. Let’s talk about the different types of coverage you should have, especially once you’re over the age of 20.

Different Types of Insurance

We’ve gone ahead and broken down this guide into the different forms of insurance you want to have, along with some considerations to keep in mind when you’re shopping for insurance.

Health Insurance

This is by far one of the most important types of insurance you can have because it deals with your personal safety and well-being.

Lots of people forego their health insurance, and there are lots of reasons they do this: it can be expensive, or people feel they aren’t likely to use it.

If you can’t afford insurance, that’s obviously an unfortunate situation.

However, if you’re intentionally not getting health insurance because you feel like you won’t use it, you couldn’t be more wrong.

Here’s the thing: we aren’t always the masters of our own destiny when it comes to our health.

You might think, “Well, I’m a healthy person and a safe driver, what would I ever need health insurance for?” But all it takes is a slip on some ice or someone taking merging blindly into your lane and you’re hurt with no insurance to back you up.

Don’t join the over 79 million Americans with medical debt issues.

When looking into health insurance, make sure you’re looking into the following factors:

  • What are your needs? As a young person, you will likely have fewer health risks than a senior citizen. Keep this in mind when shopping for a policy (low deductible + low copay).
  • Do you want to keep your current physician?
  • What’s your budget for healthcare?

Auto Insurance

There are a lot of things wrong with driving without insurance (one of which being that it isn’t actually legal), but the main thing is the risk.

When you’ve got insurance, someone hitting your car is a lot less painless than without.

For example, let’s say you get in a small fender-bender. No one is hurt, but you’ve caused some pretty serious dents in the other person’s back bumper and you don’t have insurance.

No problem, right? It’s mostly cosmetic damage.

That’s when you get the bill for the body shop and it’s thousands of dollars.

While auto insurance can’t prevent everything, it can save you some serious money in the case that someone hits you (or you hit someone else). In the worst case scenarios, it means someone’s in your corner if you caused an accident.

Here are some things to look around for when shopping for car insurance:

  • How wide is their net of coverage? Do they offer liability, collision, and personal injury protection? You don’t want to skimp on car insurance that doesn’t actually cover you well.
  • Is the policy comprehensive?
  • What is the length of your driving history? Some insurance firms will charge more for new motorists, while others can look past it depending on your record.

Homeowner’s or Renter’s Insurance

You might think that paying monthly for homeowner’s or renter’s insurance sucks. Well, at least until you come home to a broken window and $8,000 of missing stuff. Then it’s one of the better types of insurance to have.

Whether you’re renting or buying, it’s important to think about worst-case scenarios and what will happen when those scenarios become reality. You certainly don’t want to foot the bill if all of your stuff gets stolen.

Here’s the thing, too: a lot of people think these insurances only cover your possessions, but they also cover property damage as well. That means the enormous tree trunk that suddenly appeared in your living room after a storm is covered, too.

There’s a lot to consider with homeowner’s or renter’s insurance, so do your research:

  • Depending on the area you live in, you may need specialty insurance. For example, if you live in an earthquake- or tornado-prone area.
  • Do you need an umbrella policy? These policies can protect you from damages that occur during home renovation or things like parties and get-togethers where you are liable for injuries.
  • What are the exclusions? You should always read fully into the policy to make sure there aren’t any important things excluded from coverage.

Disability Insurance

Finally, one of the lesser-known types of insurance is disability insurance. This type of insurance covers you in the case that you are left unable to work after an accident or medical issue.

Plenty of people have their lives changed drastically after a disability, so much so that they can’t go to their normal job and they have to search for a supplemental policy for long-term disability to secure regular income once more. Depending on the severity of the disability, it may be impossible for that person to use their normal skill set.

Disability insurance then kicks in to pay you in the long-term.

Here’s what you need to think about:

  • What’s your occupation? Your premium depends on it.
  • What kind of disability does it cover? This can be permanent, temporary, etc.

A Note on Insurance Agents

If all of this looks confusing, it can be helpful to talk to an insurance agent like Bill Hon to get a better idea of what works for your budget and what coverage you need.

After all, insurance agencies exist to help you find the best types of insurance for your specific situation.


Now that you know the different types of insurance that you might need, you’re equipped with the knowledge you need to make an educated decision. Hopefully, you’ll even save some money in the process.

So what’s the next step? Check out our financial toolkit!