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There is no way that we should carry on without insurance these days. Even if we begrudgingly pay our monthly insurance premiums, we have, on more than one occasion, been grateful that we are covered by two or more forms of insurance. The moment that you are least prepared some kind of contingency is bound to arise.

And we have to be ready to face these head on, in case something worse than a small fire happens in our kitchen. Insurance helps us do just that -- face emergencies at times when we are least prepared.

Let me help you understand why insurance has become such a necessity. In order to do this, the five main kinds of insurance will need to be tackled briefly.

Auto Insurance: It is mandatory to have at least basic third party coverage. Although the premiums for comprehensive and collision are higher, the ideal policy would be one that provides coverage for a number of possibilities. You might think you don't need it, but accidents on the road do happen and it's better if you are prepared.

Even a small dent on the front door could eat into a lot of your salary. Auto insurance does not promise you won't get into an accident, but it will certainly help in times of road crisis.

Health Insurance: Aside from the health benefits most companies offer for their employees, individual policies are also available to consumers. HMO is the most popular and least expensive of all kinds of health insurance. The other kinds are PPO (Preferred Provider Organizations), POS (Point of Service), FFS (Fee for Service) and PDC (Prescription Drug Coverage).

A lot of older people opt for PDC, as this kind covers all of their medications. It really does make financial sense to invest in health and medical insurance today. With the costs of medical care rising, we need all the help we can get.

Dental Insurance: Dental benefits are usually included in your health insurance, but if you feel that your teeth will need more than just the usual cleaning, dental insurance is more appropriate. Be aware that dental insurance is a separate policy, and will most likely be more than the usual $10 additional fee to your existing HMO plan.

Dental insurance may not be necessary for you, but your children might benefit. They will most likely need this more than you.

Life Insurance: Life insurance is something that we all know about. Let me talk about how an insurer gains from it. Your family and other loved ones will be well taken cared for when you pass, either unexpectedly or from natural occurrences. This kind of insurance is best for those who travel a lot, work in high risk environments, or have young children to support. With a life insurance policy in place, you are stocking up on the future of your family members as well.

Homeowner Insurance: Irrespective of whether or not you own a house, you would benefit if you availed of homeowner's insurance. If you live in an area with a high crime rate or natural disasters, have valuable art collections, or just want some peace of mind, it would be a good idea for you to invest in some homeowners' insurance.