Are You Insurance Poor?

March 31, 2009 · Posted in Insurance 

Insurance is a great thing to have when the unexpected happens. Some types of insurance are not only necessary, but required as well. Liability auto insurance would fall into that category. There are certain types of insurance required by landlords if you are a renter. Homeowners are smart to get a certain amount of insurance to protect their property and home contents in the event of a disaster of some sort. There IS such a thing as having too much insurance, however.

The type of insurance that usually falls into the category of “nice to have but not really needed” is life insurance. Yes, life insurance is wonderful to have so that your loved ones are taken care of should something happen to you unexpectedly, but do you really need as much as certain insurance agents will talk you into buying? Probably not. People usually start with a basic type of life insurance that will cover certain things in the event of their passing. There is usually enough insurance in this policy to cover funeral expenses along with enough money left over to take care of other things. If you keep adding on to this policy, you will find your monthly premiums almost as much as your salary.

Homeowners and renters insurance can also be over purchased. As a renter, you will want to make sure that all of your possessions are covered in the event of fire or flood damage. However, there is really no reason to carry more than the minimum. As long as you are careful with your things and the way you conduct yourself in your environment, you maintain a certain amount of control over whether or not your things are harmed. Homeowners may want to purchase a bit more to insure not only their property but their possessions as well. This is usually a wise move, but still does not need to be over done.

Unless you have a brand new car, you are usually able to get by with liability insurance. This protects you if you are involved in an accident and is required in many states before you are allowed to even drive your car off the lot. New cars require physical damage by the lender to cover their interest but if your car is an older one or is used, it’s possible that you can avoid this premium altogether.

The simple way to avoid paying too much for insurance is by doing your own research. Once you have talked to your insurance agent and received recommendations for what you need, have a look and see if you REALLY need all of it. Chances are you will be adequately covered at a fraction of the cost your agent suggests you pay.


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