Your ability to earn income is one of your most valuable assets. According to the non-profit Life and Health Insurance Foundation for Education (LIFE), one in seven workers can expect to be disabled for five or more years before retirement. That’s why disability insurance is so important.  However, less than half of employed adults have disability insurance.

The least expensive way to get disability insurance is usually to purchase it through your employer. Should you become disabled, workplace policies typically replace 50 to 60 percent of your income up to a specified limit and until a certain age.  If you don’t have coverage through your employer, purchase a policy on your own.

You’ll find more information about disability insurance, including a needs calculator, on the LIFE web site.

Homeowner’s/Renter’s Insurance

If you own your own home, you need homeowner’s insurance to protect your home and your stuff.  Assuming you already have a policy, double-check to make sure you have the right homeowner’s insurance coverage.  If you rent, you’ll need renter’s insurance.

Vehicle Insurance

One more type of essential coverage is vehicle insurance.  A great way to save on this coverage is to manage your collision and comprehensive deductibles.  If you have an adequate emergency fund, you can afford to raise your deductibles, which will lower your premiums.  You just need to be comfortable with the idea that you are responsible for paying the amount of the deductible if you have a claim.

One final note about homeowner’s/renter’s and vehicle insurance is whether to go with a low-cost online provider or to work with a local agent.  It can be tempting to go the absolute lowest-cost route, but I prefer to work with local agents. When I’ve had a claim, there’s something very comforting about being on a first-name basis with an agent.

What other ideas do you have for getting the best insurance coverage for the best price?  Let me know in the comments section.

Other posts in this series on the 11 principles that lead to simple, meaningful success:

Matt Bell is Associate Editor at Sound Mind Investing, publisher of the best-selling investment newsletter written from a biblical perspective.  Its core investment strategy has beaten the market in 11 of the past 13 years. He is also the author of Money and Marriage: A Complete Guide for Engaged and Newly Married Couples.

Publication date: September 14, 2012