University of Illinois System


Insurance is one way to help mitigate your risk of financial loss. There are different types of insurance where you engage in a contract with a company to pool your risk among other insurance policy holders with that company.

Learn More

Enroll in the Protect course to learn more about how to use insurance in your financial plan through the Cover Your Assets module.

Basics of Risk Management

When it comes to reducing your financial risks, there are four main approaches:

  • You can bear all the risk. This is sometimes referred to as self-insuring and could require significant amounts of savings.
  • You can try to reduce or control the risk. For example, wearing a seatbelt would be one way of trying to reduce your risk of physical harm if you get in an accident.
  • You can remove the risk. For example, instead of buying pet insurance for a pet, this means you would not have a pet that would need insured.
  • Or you can transfer or share the risk. In this case, insurance can be used to spread the financial risk across a group of people.

Learn More

You can learn more about assessing and addressing risk through University of Illinois Extension's tool called Is Your Financial Security at Risk?

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Types of Insurance

Sometimes, you are required by law or a lender to have insurance, but that is not always the case.

Here are a few examples of insurance that you might purchase for different needs:

  • Car Insurance
  • Disability Insurance
  • Health Insurance
  • Home Insurance
  • Life Insurance
  • Property Insurance
  • Renter’s Insurance
  • Travel Insurance

Basic Terms

Premiums are the amount you pay for an insurance policy. It can be paid monthly, quarterly, or annually depending on the details of your insurance policy.

Copay is the amount you must pay before an insurer will pay their portion of the covered costs under the insurance policy you've purchased.

Auto Insurance

In Illinois, motor vehicle insurance is required if you own a vehicle. The minimum requirements for motor vehicle insurance may not cover the entire financial liability of getting into an accident, so it's important to think critically about purchasing the right amount of insurance for your needs.

Learn More

Watch the part of our Speed vs Savings webinar recording where we talk about auto insurance to learn more about assessing your auto insurance needs.

Health Insurance

In the United States, health insurance is a major part of the healthcare system. This type of insurance requires the insurer to pay a portion of medical costs when visiting a healthcare facility, be it a primary care provider, hospital, or other medical specialist. It does not cover dental or vision care costs. There are separate types of insurance for these costs.

Most students receive group health insurance through their respective universities in the University of Illinois System. If you are covered under a parent's insurance, you can opt out of the student health insurance fee by contacting the student health insurance office for your university.

Learn More

Watch our recorded webinar, Health Insurance Dissected, to learn more about the ins and outs of health insurance in the United States.

Life Insurance

Life insurance is a type of insurance purchased to be paid out to a beneficiary when you die. This type of insurance is often purchased to help support your loved ones when you pass away or pay off a debt, like the remainder of your mortgage. 

There are two main types of life insurance: Whole and Term. 

Term Life Insurance

Term life insurance typically is purchased for a certain period of time when you may need extra insurance. For example, you may buy term insurance when you purchase a house or have a baby.

Premiums are often lower than whole life insurance plans, but they can increase, depending on the policy.

Whole Life Insurance

As long as the premiums are paid, whole life insurance will follow you your whole life. It does include a savings component that can be attractive to consumers.

Premiums typically stay the same during the life of the policy. The older you are when you take out this type of policy, the higher the premium will be. However, premiums are generally higher than term life policies and the associated savings can lose value over time.

Learn More

Watch the portion of our Planning for the Unforeseen webinar where we focused on the types of life insurance we can purchase for our loved ones.

Renter's Insurance

Renter's insurance is designed to help protect against the financial loss of personal property theft or damage while living in a rental property. It's important to remember that your landlord may have insurance on your rental unit in the case of fire, flood, etc., but that insurance does not replace your personal property.

The cost of rental insurance is often much more affordable than the potential cost of replacing your entire wardrobe, furniture, and other personal affects.

Learn More

Listen to our podcast episode on insurance to learn more about a wide variety of insurance types including auto, renter's, home, property insurance and more...

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