Avoid this insurance mistakes

To protect yourself and your finances, you have to start navigating through different coverages, exclusions, premiums, deductibles, and some other terms.
If you can avoid most or all of these, you’ll be able to get the protection you need without paying a penny more than you should.

1. Skipping on Renter’s Insurance

You might decide to skip on renter’s insurance because you don’t own much stuff and don’t have anything particularly valuable.

That could be a big mistake.

For one thing, what you own is probably worth more than you realize. Just imagine replacing all of your belongings, one by one, if they were destroyed. Your clothing, electronics, any appliances or furniture – it would all add up to one huge expense. With renter’s insurance, you wouldn’t have to struggle to replace it all.

Renter’s insurance comes with liability coverage that protects you in case someone is injured while visiting your apartment. If you’re sued or found responsible for that injury, it could set you back (weeks, months, or years) financially. Unless, of course, you have renter’s insurance.

2. Not Carrying Enough Insurance

Okay, you realize need insurance so you reluctantly agree to buy a few policies, but you try to save some money by buying the cheapest ones you can find. If you go looking online, you can even find one-size-fits-all insurance policies for as little as a few dollars a month.

When it comes to insurance, however, you often get what you pay for. Policies with low prices that look too good to be true often have some pretty bad terms. Going cheap means you might have a really high deductible (which means higher out-of-pocket expenses if you ever need to file an insurance claim), a low maximum payout (leaving you underinsured), or a long list of perils that won’t be covered.

These limited policies don’t just leave you with a lot of out-of-pocket expenses; they can also leave you open to a personal lawsuit if you’re involved in an accident that exceeds your coverage amount.

3. Buying Too Much Insurance

Not buying enough insurance is a mistake, but overdoing it isn’t great either.

Some policies are essential, but others are just nice to have and you might be better off saving or investing the money you’d spend on them.

If you’re not sure how to strike the right balance, get in touch with an insurance advisor. They’ll help you figure out what you need and what can wait.

4. Thinking You’re too Young for Life Insurance

If you’re an average American, your life expectancy is pretty good, and if you haven’t settled down yet, you don’t have a spouse or children who depend on you for support. But if you think that means you should put off buying life insurance until you’re in your forties, you’re wrong.
What you might not realize is how incredibly cheap your life insurance will be if you buy it now compared to the price you’d pay if you waited. And the best part is, you can lock in that low rate for decades.
You’ll never be this young again, so be sure to buy life insurance while it’s still affordable
5. Thinking Disability Insurance Isn’t for You
Being young doesn’t exclude you from injury or illness, and it could sneak up on you when you least expect it.
If you lost your income due to a disabling injury or illness, the financial outcomes will likely be devastating.

Unless that is, you have disability insurance to fall back on. It will provide you with a minimal, but likely sufficient, source of income while you recover or adjust to your new realities.

6. Choosing a Really High Deductible

A higher deductible means lower monthly or annual insurance costs. But it comes at a price.
Let’s say you choose a $1,000 deductible on your property insurance. You’ll be paying lower premiums, but it also means that you won’t be able to recover anything for property damage or loss that falls under $1,000. That might not be enough to cover your laptop and probably won’t be of any help if you need to replace your camera or a major appliance.

7. Not Reviewing Your Policies Every Year

Life changes quickly. It’s essential to review your policies regularly to make sure you don’t need any additional coverage and that you’re not paying for insurance coverage you no longer need.

Getting married, having kids, upgrading your place, buying nicer stuff, any of it could make a difference to your insurance needs.

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