Let’s face it, saving money feels awesome. Saving money on your insurance coverage is an excellent way to either put away, or spend a few extra bucks each month. That being stated, reducing your coverage or even dropping important pieces of the insurance puzzle can backfire on you in a significant manner.
You need to focus on the entire picture. If you only concentrate on the numbers and leave the results out of the equation you are doomed to fail.
In essence, you are taking the risk of ending up underinsured. That means you may very well end up being responsible for paying humongous bills out of pocket if and when a disaster strikes. Avoiding the following insurance related mistakes will go a long way in helping you save money without the risk.
Mistake #1- Selecting An Insurance Company Based Only On Price
Competitive prices are certainly an important aspect of choosing an insurance company. However, you also need to be sure that the company you decide to do business with provides great customer service and is financially sound.
You can test an insurance company’s customer service by reading online reviews, asking your contact list about their experience with the business, and checking their Better Business Bureau rating. You can also check the financial health of the business with an independent credit rating agency such as Moody’s or A.M. Best.
Mistake #2- Eliminating Flood Insurance On Your Home Or Commercial Property
Did you know that damage that is caused by flooding is not covered under the standard property insurance policy? It is also not covered under a standard renter’s insurance policy.
Although you may not be aware that you are at risk of a flood, you do need to keep in mind that approximately 25% off all floods occur in low flood risk areas. In addition, spring runoff from melting snow happens to cause a significant amount of flooding in Massachusetts.
Even if you never experience a flood, having flood insurance will provide you with peace of mind just in case one happens to strike.
Mistake #3- Failing To Purchase Renters Insurance
Are you aware of the fact that renters insurance covers both your possessions and the addition cost of living expenses if you need to move out of your apartment in case of a disaster such as a hurricane or fire?
Just as important, your renter’s insurance policy also covers you for liability protection if another party is injured while at your home. This comes in extremely handy if they decide to sue you.
You can actually save money by looking into multi-policy discounts. For example, when you purchase numerous insurance policies with the same company, they will typically provide you with a package deal.
Mistake #4- Purchasing The Minimum Amount Of Automobile Liability Insurance
When you only purchase the minimum amount of legally required Auto Liability insurance you are getting what you pay for, which of course is minimum coverage. That means you will need to pay far more out of pocket if you cause an auto accident and are sued.
This of course can completely jeopardize your personal financial well being. The good news is that you can save money by dropping collision and or comprehensive coverage on automobiles that are worth south of $1,000.
It is important to fully understand exactly what you are purchasing when it comes to insurance policies. If you have any questions, please call (508) 831-0133 to contact an associate at Zawada Insurance. We are happy to walk you through the details of your insurance policies and explain your coverage options. We look forward to helping you with all of your personal and or business related insurance needs now and in the future.