With the turn of a new year, it feels like we get a clean slate. It is an opportunity to improve upon what we may be lacking or slacking on. At the top of many resolution lists is to be more organized financially disciplined. As insurance is a large part of many household and business budgets, it is a great time to review your policies and ensure your coverage is up-to-date, you are not paying for coverage you do not need, and that you are protecting your hard-earned assets.
Top 3 Mistakes People Make with Insurance
- Not looking at the insurance policy
- Not fully protecting assets
- Not taking advantage of free expert advice
1. Not Looking at the Insurance Policy:
We understand that no one is excited to sit down next to the fire with a cozy blanket and crack open an insurance policy for a good read; however it is in your best interest to review these documents. It is a regular occurrence that someone will call our office to let us know that there is a vehicle on their NH car insurance policy that was sold months, if not years, ago. This can cause you to pay for insurance you did not need. This is especially true for businesses that have a fleet of vehicles. By taking literally a few minutes to review your policy can uncover oversights and errors that could easily be avoided.
Not removing a car is bad, but not adding one is worse. Car dealers want to do everything possible to sell you a car and often promise to handle the insurance for you. This can be disastrous, because if they forget, you could be left driving around without insurance. The dealership is not contractually obligated to inform the insurance company you purchased a vehicle -- you are -- so with something so important, be sure to follow up with your insurance agent to ensure the necessary information was provided. This is true whether you have a loan or not because though the lender will most likely discover that proof of insurance was not received, it can take a while. It is a terrible situation when a car has been involved in an accident and there is no coverage due to a seemingly small oversight.
2. Not Fully Protecting Assets:
The way insurance is sold today, price is often the main focus of the policy. Though everyone likes to save money, if you purchase a policy solely based on price without considering coverage, you are most likely not protecting your assets, which is the very reason why you have insurance in the first place. When you buy an insurance policy with many online companies, the system will automatically put the lowest liability coverage into the quote so the premium will be lower, which entices you to buy it. Take a moment to review what liability limits you have on all your policies as this is the coverage that pays for a covered claim, should you be sued.
A very simplified way to get a snapshot of the minimum liability limits that you should consider can be determined by considering the following:
| Equity (in your home): | $____________________ |
| Personal Property: | $____________________ |
| Investments: | $____________________ |
| Savings/Checking: | $____________________ |
| Future Wages: | $____________________ |
| Total Amount at Risk | $____________________ |
Is what you have at risk more than the liability limits on your car insurance or other policies with liability coverage included? Do you have a teenage driver in your household that may be putting those assets at risk with low coverage limits? Would you be extremely upset if you learned you could have protected your assets in exchange for a couple hundred dollars? Saving money is great but not at the expense of sending you to the poor farm.
3. Not Taking Advantage of Free Expert Advice
When you buy insurance through an independent agent, you are typically working with a licensed agent who has experience with many different insurance companies and can customize your insurance to fit your needs. At HPM Insurance, we love it when clients take the time to call us and ask questions. In today's fast paced world, many folks turn to the internet for answers and as we all know, just because it is on the internet, does not mean it is true. It only makes sense to speak with someone who deals with insurance every day to answer questions that can protect your home or livelihood.
Insurance can be complicated, so tap into a free resource -- an insurance agent -- to help you navigate its complexities. There is no cost to do so, and an independent agency does not work for an insurance company so can give you unbiased advice on what would fit your needs.
With insurance being such a huge part of your budget and financial protection, it is certainly worth taking a little time to think about it. You will be glad you did and you can feel good about accomplishing a resolution of being more organized and financially disciplined.
