However, given how varied and extensive the insurance industry is, the question of whether one needs insurance is a bit misleading. ‘Need’ is a fairly subjective concept, as what insurance policies are required and essential depends on an individual’s own circumstances.

While insurance may not always be mandatory per se, in many areas a policy can be a vital necessity in all but legal status.

Likewise, there are also insurance policies to avoid, which very few people would benefit from, and no one could ever be said to truly ‘need’. This guide should help you determine what insurance you ‘need’, and what policies you might steer clear of.

What insurance do I need?

There are, of course, certain forms of insurance that are mandatory. For instance, any car driven on a UK road must be insured – and all mortgage providers consider buildings insurance a prerequisite for all borrowers.

However, there are further questions of need. For instance, you need to ask yourself whether you opt for a fully comprehensive car insurance policy, or simply stick with the minimum basic cover, or go for something in between.

What insurance should I have?

Again, what insurance products you ‘should’ have is not a universal question. Beyond the essentials, the sky’s the limit, depending on your needs, situation and budget – you can insure almost anything you’d like to insure.

The Money Advice Service has published an extensive list of the most common forms of insurance, which you can view here. You could also contact an insurance provider.

What insurance can I go without?

As Your Money noted in our guide to reducing mobile bills, mobile insurance is often expensive, and sometimes offers insufficient cover. What’s more, home contents insurance can offer cover for mobile phones (and, indeed, other items such as bicycles, handbags, MP3 players, laptops, etc.), even if the item is lost, stolen or damaged outside the home. This not only makes home contents insurance one of the most cost-effective forms of insurance, but also means that individual insurance policies for many possessions is unnecessary.

If you have a home contents insurance policy, check the smallprint and see whether your home contents insurance policy does cover these items. If not, investigate whether personal possession insurance can be added to your policy. If you do not have a home contents insurance policy, please visit the Your Money guide.