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You know you need insurance, but how much? What types are critical? You want to be protected but you don't want to pay for superfluous or redundant coverage.

Yes, the old insurance question. Everyone hates it until you need it. Then you appreciate those faithfully paid premiums as your insurance agent stands before you at midnight with the property insurance claim form. Read on for tips on the types of insurance that you must carry, and those that may be better left aside.

Over half of all reported bankruptcies are tied to health insurance claims. These are claims that can topple your household deck of cards. Health insurance is very important to your ongoing financial solvency and leads this list of key insurance plans. You think you're maintaining a healthy lifestyle, but medical conditions have an insidious way of creeping up when least expected. Accidents happen too. Best to have a good health insurance plan to defray or reduce medical expenses and protect your hard-earned nest egg.

Do you anticipate going to the doctor often? This may be especially true for those with young children or those with ongoing health issues. If this is the case, you will want a health insurance plan that has low deductibles. The deductible is the amount that you must first pay out-of-pocket before your insurance steps in to pay. If, on the other hand, you do not visit the doctor often, you might be best served with a higher deductible policy.

Automobile Insurance

Not only is this insurance crucial for car owners, but it is also required in almost every state. How much insurance and what type of auto coverage needed depends on several factors.

First, is your car an old clunker or a newer model? Older vehicles may only need liability coverage. In the event of an accident, your liability policy will pay for the other party's medical bills and auto repairs. And therein help you avoid a lawsuit if you were at fault. Liability coverage does not pay for damage to your car or injured passengers in your vehicle.

If on the other hand, you have a newer vehicle, you will want collision coverage which also pays for repairs to your car in the event of an accident. If you have taken out a loan to purchase your vehicle, you will most likely be required to have collision coverage as part of your policy.

Comprehensive coverage is auto insurance that pays for damage to the vehicle outside of an accident – such as damage caused by a fallen tree. It also protects the policyholder if the car is stolen.

Homeowners Insurance

Your home is typically your biggest asset and demands superior protection. Homeowner's insurance pays for many types of damage and also theft. But sometimes you need additional coverage to insure against flooding, earthquakes and fire – as well as other natural disasters that are not covered under the homeowner policy umbrella. Additional policies or riders on your policy may be required for an additional fee.

Disability Insurance

You work hard for your money. But what if an accident or illness takes you out of the workforce for an extended period? Could your family exist without your salary? These are critical questions to ask as you consider purchasing disability insurance. If any doubt, the "better safe than sorry" approach may be in order. Disability insurance pays you when you are unable to work due to illness or chronic health conditions. Having good disability insurance may make the difference between covering that mortgage payment and keeping your home or losing it to foreclosure.

Life Insurance

Lead candidates for life insurance are most certainly parents with young dependent children. While the death of a parent will be disastrous enough, the impact to the family finances can be equally devastating. The most affordable type of life insurance is term life insurance. These policies are set for a given term – be it 10 or 20 years. If death occurs during this time, the beneficiary receives the payment. And funds are then available to carry out the work of the deceased – from covering burial costs to providing family income and paying for college expenses.

Other Insurance Offerings

Other types of insurance may be of interest depending on your individual needs. Vision insurance plans help those with ongoing vision issues. With this insurance, you are better able to budget for eye exams and the resulting contacts or eyeglass prescriptions – which can cost hundreds and hundreds annually without vision care insurance.

But there are some types of insurance that you typically do not need. Life insurance for children is one example. Your kids are typically not earning a wage that the rest of the family is counting on. Therefore, paying for life insurance just doesn't make sense. And beware of car rental firms asking you to pay for insurance on your rental. Double check your auto policy but typically your own automobile insurance covers this for you.