In today’s world, it’s impossible to go without insurance and live a stress-free life. Insurance is a safety net that keeps you from experiencing financial burden due to insurance claims. It can protect you from liability suits, natural disasters, or any unforeseen circumstances. However, it can be complicated and there are some common insurance mistakes that a lot of people make.
Unfortunately, a majority of these people don’t find out they’ve made a mistake until it’s too late. You don’t want to be stuck paying too much for insurance or not having the proper coverage.
Here’s a list of the top 5 insurance mistakes people are making.
Insuring Your Home at the Real Estate Value
Most people consider the value of their home to be relative to the real estate market’s performance. Therefore, some people are making the mistake of insuring their home according to what the market says it’s worth. However, this is incorrect and can be financially devastating in the wake of an accident. Instead, you should always set the insured value to the replacement cost of your home. By doing this you’ll have enough coverage to rebuild the home in case of a natural disaster or accident.
Choosing an Insurance Company by Looking at Lowest Rates
There’s no harm in exploring different insurance providers and going with the one that offers you the lowest rates. However, the company that offers the lowest rates may not offer the best coverage. Therefore, you should also look at the company’s rating and reviews before you make your decision. By doing this you can find an insurance provider that has an excellent standing, wonderful customer support, and suits your budget.
Failing to Choose Flood Insurance
Most people don’t consider purchasing flood insurance because they think they live in an area deemed safe. However, flooding can occur from downpours or melting snow in the winters. Therefore, when you’re looking to buy a new home, contact the National Flood Insurance Program and inquire whether the neighborhood lies in a flood zone. If you are already living in a flood zone, you can also contact the NFIP and find out how you can opt for flood insurance now.
Even if you don’t live in a flood zone you can still experience flooding. In fact, most FEMA flood maps are outdated and 40% of flood insurance claims come from areas in safe zones.
Purchasing the Lowest Legally Required Car Insurance
Some people opt for cheap car insurance with minimal coverage because they believe they don’t need it. This is a huge mistake in the long-run because accidents can happen and no one is a perfect driver.
Not Buying Renters Insurance
Last but not least, people tend to neglect renters insurance in an effort to save money. Renters insurance will cover your personal possessions in the apartment or home you’re renting. Accidents, theft, and natural disasters can occur. Lastly, you will have liability protection if someone were to get injured in your house and decides to sue.
Summing Up
It’s always important to have the best coverage for you and your belongings. Not doing this can create a financial burden. Talk with an agent here at InsuranceHub to get affordable and quality quotes from some of the top providers. Our agent will work with you to make sure you have optimal coverage.
Link
https://www.iii.org/article/five-insurance-mistakes-avoid-and-still-save-money