In these times of cost of living increases when all of your household bills and expenses seem to be increasing all the time, it may be tempting to think that you could forgo your monthly insurance premiums and take a ‘hope for the best approach’.

Although optimism can be a good thing, insurance offers essential financial protection for unexpected events and when things go wrong.

While motor insurance is a legal requirement in order to drive in Ireland, and you would face penalty points, fines, and even imprisonment if you were to drive uninsured, home insurance, health insurance, and life insurance are not legally required in Ireland.

However, life is not always plain sailing and insurance exists to ensure that you do not face large and unexpected expenses when things go wrong.

Your home is likely your biggest asset and the most expensive purchase you will ever make so having home insurance in place to protect your home is essential. Even a basic buildings insurance policy that protects your home and is based on an accurate rebuild cost will provide peace of mind and financial protection should there be a storm, flood, water leak, or a fire, and your home is damaged.

Home insurance also protects you financially if your home is vandalised or broken into, with cover like replacement locks and keys and emergency home rescue if you have been the victim of theft.

Likewise, think about your possessions that you use and rely on every day and imagine having to replace all of your furniture or appliances, for example, if there was a fire in your home or they were damaged by flooding. It would be a very significant expense to face if you had to replace all of these items.

Home insurance also provides third party liability cover which is essential if a visitor or domestic worker is injured on your property. Home insurance liability cover will pay for medical bills and legal fees, up to a policy limit, should a claim be made against you.

Many mortgage lenders will also require you to have home insurance in place prior to drawing down mortgage funds. Your lender will want to protect their investment in your home by ensuring that it is insured.

Health insurance is not mandatory in Ireland but offers protection if you had an accident or became ill and required medical attention. Health insurance offers financial protection against large and unexpected medical bills which you would have to pay out of pocket without health insurance cover.

Health insurance also affords you a wider choice of hospitals and a choice of consultants should you require medical attention. You would also usually be able to access private care more quickly than facing long waiting lists for public healthcare.

Although health insurance may seem like an unnecessary expense, having insurance cover should you need to be admitted to hospital, see a consultant, or receive treatment such as physiotherapy can mean that you benefit from private healthcare and avoid large medical bills.

Lifetime community rating also means that, if you take out health insurance over the age of 34 in Ireland for the first time, you will initially face higher premiums than if you purchase health insurance earlier in life. If you take out health insurance for the first time when you are aged 54, for example, you will pay 40% more for health insurance.

Health insurance also has waiting periods so, if you require treatment, it is not possible to wait and purchase health care when you have developed a health condition or require maternity care, for example.

Yes, most likely you do need life insurance. Life insurance provides financial protection should you die during the term of the policy. If you have a family or others who rely on your income, or have a mortgage or other debt then having life insurance will protect your loved ones if you die unexpectedly.

Life insurance leaves your family or loved ones a tax free lump sum and will pay for immediate expenses, such as the cost of your funeral, without having to burden others with them at a difficult time.  Life insurance will also help your family or those who depend on you to cover necessary expenses and maintain their lifestyle after you are gone. 

If you have a mortgage, having mortgage protection to pay off the balance of your mortgage if you die before it is paid off is a legal requirement. Having a life insurance policy will also be considered as mortgage protection providing the sum assured or level of cover will pay off the mortgage in the event of your death.

Having life insurance in place will also ensure that other debt such as a car loan will not be inherited by your family.

Although life insurance may seem unnecessary, it provides an invaluable safety net if you have a mortgage or debt, have a family or others who rely on your income, or have children.

It’s also really important to bear in mind that, although you may save a few euros in the short term, life insurance premiums can significantly increase as you get older, especially if you develop a health issue. If you purchase a life insurance policy when you are younger, you are more likely to be accepted for cover and to pay much lower premiums for the whole of the policy term, saving you thousands over time.

Foregoing important financial protection and leaving yourself financially exposed, or facing higher premiums later in life because you wanted to save money in the short term, is never worth it. It’s also not always the best idea to try to save money by going for the cheapest cover available.

Insurance is never necessary until you need it and getting comprehensive cover tailored to your needs can often be comparable in price to basic insurance plans, and is much wiser than going without insurance to save in the short term.

If a situation arises, where your home is damaged, or you are ill, or in the worst case scenario, were you to die unexpectedly, insurance is invaluable and proper cover will mean that you do not face out of pocket costs, or leave your loved ones unprotected.

Compare insurance can offer you tailored cover based on your needs for the best prices on the market, whatever type of insurance you are looking for. Start the ball rolling complete our online assessment or call us to discuss your needs.