7 Common Insurance Mistakes That You Should Be Aware of

7 Common Insurance Mistakes That You Should Be Aware of

Insurance is essential because it provides both personal and financial security, and protects your assets if an accident occurs or an emergency situation arises. However, figuring out which types of policies will be the right fit for your situation can become complex. That’s why it’s easy for you to make mistakes that could cause problems in the future.

Here is a look at 7 common insurance mistakes you need to avoid.

  • Neglecting Insurance:

    Neglecting basic insurance coverage is a serious mistake. Think of the potential disasters that you will be left open to! Imagine if you were involved in an auto accident, or someone stole your car, or a fire caused severe damage to your home or rental property, or you suffered a freak accident and broke bones, or you were diagnosed with an illness. If you do not have insurance, you would likely face a financial catastrophe in all these situations. If you are unable to receive coverage through your employer, research “catastrophic insurance plans” so that you will at least have some protection.

  • Being Over-insured:

    Avoid the mistake of having too much insurance. Look for an insurance agency near you to figure out how to protect your assets. As a young adult, you may believe that you don’t need a lot of insurance to cover your assets, but your needs may change over time. You may get married and start a family, or you may purchase a new car and decide that you want to purchase collision and comprehensive coverage for it. Assess your options every year to make sure that you aren’t paying for unnecessary coverage. This will help you save money.

  • Purchasing the Wrong Policy:

    One of the most important insurance mistakes to avoid is purchasing the wrong insurance policy. People waste thousands of dollars every year buying policies that do not benefit them. Make sure that you have a clear understanding of what a policy entails before you purchase it. This will also make filing a claim much easier.

  • Failing to Shop Around:

    You should shop around for a new policy either every two years or after you have made a major change in your life (e.g., starting a new job or getting married). Regardless of the circumstances, you can save money by adjusting your policy or switching to a new provider.

  • Failing to Research Discounts:

    You could save money by qualifying for multiple discounts, but this won’t happen if you fail to ask about them! Talk to your agent. You may qualify for a group discount, or an individual discount based on your occupation, university, or military service.

  • Being Under-insured:

    Basic insurance policies are appealing because you will be paying lower premiums every month. However, a disaster could wipe out your savings as you will have to pay a deductible, along with other out-of-pocket expenses. If you don’t have enough basic coverage, then you’re taking a risk. Consider adding the maximum amount to your policy. This way, if you break your leg or get diagnosed with cancer, then you can rely on your insurance to cover you.

  • Focusing Solely on Group Insurance Coverage:

    If you agree to only join your employer’s group policy, then remember that your rates may change over time. Research personal life insurance coverage before agreeing to any group policy. Thoroughly analyze the group policy, as well. Make sure that you are aware of your benefits so that you can avoid being caught off-guard in the future.

Consult with 01 Insurance

There are various things to consider while searching for insurance coverage. Avoiding these common mistakes can ensure that you have the right coverage when you need it most. The experts here at 01 Insurance will help you find the right insurance policy.