Worst Insurance Moves In 2006
Posted by David Schneider | August 28, 2007

It’s pretty hard to pinpoint the worst insurance mistakes in 2006 because there are so many of them. People just don’t like dealing with insurance, whether it’s life insurance, car insurance or something else. What happens is that they’ll rush into a policy and never look at it again. These are two very bad insurance moves.

Review Your Policy Regularly
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聽Let’s take the latter issue. One of the major mistakes that policyholders make is not reviewing the policy periodically, at least once a year. With a long-term policy such as whole life insurance, this is imperative, as so much can change in relation to the policyholder’s health; the possibility for lower premiums may exist, but be missed without review. Even if you spent an obsessive amount of time setting up the policy this doesn’t mean you’re off the hook. Reviewing an insurance policy is vital.
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聽On a similar front, this entails making sure that you have the right amount of coverage. For instance, imagine if the weather forecast for 2006 said that there was going to be an elevated amount of hurricane activity in your area. Not preparing for this ahead of time is a woeful mistake. Anyone in this situation needs to enhance their flood protection, wind protection and general homeowners insurance policy to make sure they’re adequately covered. This is why reviewing the policy is imperative, as a policyholder’s needs can change from year to year.
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聽Homeowners also frequently make the mistake of not buying insurance in lower risk areas. Your home doesn’t have to be in the direct path of a hurricane to require flood insurance. The same goes for fire or earthquake insurance. Just because something didn’t happen yesterday doesn’t mean you shouldn’t provide protection for the future.
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聽Car Insurance Problems
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聽In 2006, people made as many mistakes with their car insurance policies as they did with their homeowners insurance policies. Again, getting adequate protection is a big one. In addition, not getting theft protection or trying to insure an unsafe older car are big problems. Obviously, the old car needs insurance but you’d be much better off trying to insure a car with a good safety rating. What you save on insurance premiums could go into buying a better car. At the very least, you should not buy extensive collision insurance on a car that probably won’t be fixed up to look new in the event of an accident.
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聽Shopping for Insurance
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聽Finally, people generally just don’t take the time to investigate if there are better insurance policies out there. In 2006 a record number of people were overcharged for their insurance policies. Doing a little research and finding the best possible quote for a certain kind of policy can save you hundreds, if not thousands, on yearly premiums. As the Internet has made it exponentially easier to compare and contrast insurance rates, there is no reason to not research each type of policy you require.
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聽Remember, insurance is an ongoing process. It’s not like a traditional product that you purchase and never revise. All insurance is a work in process. If you didn’t get optimal rates the first time around, you can potentially get a better rate at a later time. Even if you did do ample research, it’s still possible to receive lower rates or to require additional coverage.