At its core, insurance is a bet against a risk you couldn't afford yourself: many people pay a small, predictable amount (the premium) into a shared pot, so that the few who suffer real damage get compensated from it. This is called the solidarity principle, the community together carries what an individual couldn't bear alone.
In Switzerland, only a single type of insurance is mandatory for everyone.
Basic health insurance (OKP) is mandatory for everyone in Switzerland. Benefits are legally identical across all providers, so it's worth comparing only the premium each year and switching if needed.
Alternative models (family doctor or telmed model) are often cheaper than the standard model, because you have to contact a specific point of first contact before seeing a specialist.
Everything else is voluntary, and only worthwhile if it covers a risk you couldn't bear yourself.
Pays out when you accidentally cause damage to someone else (e.g. a broken vase, a bike accident). Cheap in premium terms, but covers potentially very high claims, worthwhile for most people.
Protects your furniture, electronics and personal belongings against fire, water damage, burglary or theft. Worthwhile for most people with their own household.
Covers lawyer and court costs in legal disputes (e.g. rental, employment law). Can be worthwhile, but not essential for every life situation.
Covers extra benefits (e.g. dental prosthetics, glasses, semi-private hospital ward). Unlike basic insurance, benefits and prices here vary a lot between providers, signing up "because everyone has it" isn't automatically worthwhile.
Combines insurance cover with a savings component, sounds practical, but because of high fees compared to saving/investing separately (e.g. via ETFs), it's often the more expensive option.
Calculated over several years, you often pay more in premiums than a repair would have cost in a claim. An emergency fund usually covers this risk more cheaply (see Calculators).
For every insurance offer, it's worth comparing along the same points:
Ask yourself for every type of insurance: "Could I pay for this damage out of my own pocket?" If yes, you probably don't need the insurance, and your money is better off in an emergency fund or an ETF savings plan.
These words come up with every type of insurance, once understood, they help you with every comparison.
The policy is the document confirming your insurance contract, who is insured, against what, from when and at what price. In a claim, you usually need it as proof.
The premium is the amount you pay periodically (usually monthly) for the insurance to apply at all, regardless of whether you ever need it.
The Franchise (annual deductible) is the amount you pay yourself each year before insurance kicks in (for health insurance, min. CHF 300, selectable up to CHF 2500). A higher franchise lowers your premium, worthwhile if you rarely use benefits and can afford to pay it if needed.
On top of the franchise, with health insurance you also cover 10 % of further costs yourself up to an annual maximum, the Selbstbehalt (excess).