Insurance

Whether you are a full time or a part time trader, you should have proper insurance coverage for yourself and your property.  Although insurance can be expensive, not having it can be even more expensive.  A way to reduce the cost, is to increase the deductibles.  Doing this reduces the premiums, but since you are effectively self insuring a greater portion of an insurable event, you need to make sure you have money set aside to cover the higher deductibles.  A way to have the money to pay the higher deductibles is to place the premium savings from each premium payment into a savings/money market account.  Once the balance in the savings account is equal to your deductibles, you can stop funding the account.  Remember that if you take money out of this account to pay for a deductible, you need to once again start putting you premium savings into this account until it is replenished.  The information on DayTraderU on insurance is not designed to be all encompassing.  It is designed to introduce various insurance topics to you.  Please consult a trained insurance professional regarding your insurance needs.

• Personal Insurance:
  • Health - an absolute must
  • Disability - expensive but you should have it
  • Life - used to replace your income if you should die
  • Long Term Care - will be important to have especially if you have a family history that relatives wind up in nursing homes.
• Property Insurance:
  • Auto - required in most states to register a vehicle
  • Homeowners/Renters - required as a condition of obtaining most mortgages
  • Liability - if you have substantial assets, this is a must.  Also called an umbrella policy