Tips to Consider When Buying Insurance

When purchasing insurance, many people place complete trust in their insurance agents, assuming they will receive the coverage they need. While insurance agents generally provide solid guidance, they may not be aware of your specific needs until it’s too late. To avoid surprises down the road, it’s important to take an active role in understanding your policies. Here are some essential tips to keep in mind when buying insurance.

1. Ask Questions

If you’re uncertain about your coverage, policy limits, or any conditions, speak up. It’s crucial that you fully understand what you’re purchasing, especially when it comes to policy exclusions and limits. Don’t hesitate to ask your agent for clarification.

2. Life Insurance and Estate Planning

When buying life insurance, it’s essential to consult with your attorney to ensure the policy aligns with your estate planning needs. You should also be clear on how and when your life insurance premiums might increase and whether coverage could end before you pass away.

3. Adequate Auto Insurance Coverage

It’s important to carry sufficient liability limits on your auto insurance. For example, if you own a home worth $500,000 and have significant savings, carrying only $100,000 in liability coverage puts those assets at risk. A good starting point is at least $300,000 in liability coverage.

4. Rental Car Coverage

Check if your auto insurance covers you while driving a rental car. Some policies only provide coverage when your regular vehicle is being repaired, leaving you exposed when renting a car for other reasons.

5. Uninsured and Underinsured Motorist Coverage

Uninsured Motorist (UM) and Underinsured Motorist (UIM) coverage is relatively inexpensive and provides vital protection if you’re injured by a driver with no insurance or low coverage limits. Medical Payments coverage is also affordable and helps cover medical expenses regardless of fault.

6. Towing a Trailer or Camper

If you plan to tow a camper or trailer, verify that your auto insurance policy provides coverage. Many policies have specific provisions or may require additional coverage for towing.

7. Homeowners’ Insurance and Replacement Value Coverage

When shopping for homeowners’ or hazard insurance, look for replacement value insurance. This type of policy ensures you’ll receive enough to rebuild your home in the event of a loss, helping you avoid potential disputes over the value of your property.

8. Coverage for Valuables

If you own valuable jewelry, art, or collectables, ask your agent whether your homeowners’ policy provides sufficient coverage. You may need a scheduled property endorsement to fully protect these high-value items.

9. Home-Based Businesses

Running a business out of your home or storing business equipment at your residence could leave you without adequate coverage under a standard homeowners’ policy. Ask your agent if you need a business endorsement or a separate business insurance policy to protect against potential losses.

10. Home Inventory

Keep an updated inventory of your home’s contents, including photos or videos. Store this inventory in a safe place outside your home, such as a safety deposit box. This can be invaluable in the event of a claim, helping you substantiate losses and avoid disputes with your insurer.

11. Health Insurance: Full Disclosure Is Key

When applying for health insurance, always disclose all relevant health information. It’s better to provide too much information than too little. Health insurance companies may scrutinize your application if a claim for a major illness is filed, looking for reasons to deny coverage.

12. Appeal Health Insurance Denials

If your health insurance company denies a claim, you have the right to appeal. Be aware that there are deadlines for filing appeals, so it’s important to act quickly. Consulting an attorney can help you navigate this process and ensure your rights are protected.

13. Consider an Umbrella Policy

An umbrella policy provides broad protection beyond the limits of your auto, home, or business insurance policies. This type of coverage is typically inexpensive and can greatly increase your liability limits, providing additional peace of mind.

Final Thoughts

Buying insurance is about more than just selecting a policy—it’s about understanding your risks and ensuring you have the right protection in place. If you have questions or concerns about your insurance coverage, consulting with a knowledgeable attorney can help you make informed decisions and protect your assets.

At Ferikes Bleynat & Cannon, our experienced attorneys are here to guide you through the complexities of insurance coverage and disputes. Contact us today to learn more about how we can assist with your insurance needs.