If you've been putting off your plans to buy insurance, it's important to think about a few things before you sign your policy. While insurance can be an important way to protect you and your family against unforeseen circumstances, it matters that the policies you choose are right for your specific needs.
Budget
Looking for policies based on price alone might sound as though it's a good idea for your financial budget, but you should always check that the insurance policy you're paying for will give you the inclusions you think you're getting.
Some insurance companies may reduce the amount of cover you'll receive in order to keep the prices down. You may find there are exclusions on your coverage. While the price you pay is important, always be sure you're covered for the things you really want.
Inclusions and Exclusions
Many insurance companies write their policies in difficult-to-understand language that can be hard for some people to follow. If you're not sure what's included in your policy, ask a representative to clarify this for you. Ask plenty of questions and understand exactly what you're getting – and what you're not.
If you're not happy with the answers you receive, continue to ask questions until you can work out whether your policy is offering you the right amount of cover for what you need. You may just learn that you need to fine-tune your insurance to either add or remove some aspects that could suit you better.
Right Amount of Insurance
A surprisingly large number of people are under-insured for what they really need to protect themselves. Look closely at the level of coverage you need before you buy insurance and make sure it will be adequate for what you really need.
Unfortunately, there are also people who are over-insured, which means they could be paying far more on their premium amounts than they really need to.
Premiums
Some insurance companies will raise the premiums you pay simply based on your medical history and physical health. You will need to be honest on your application form when you buy insurance, or you risk having your insurance voided, so be sure to disclose your medical history and answer any questions about your lifestyle truthfully.
For example, smokers may pay more in health insurance premiums than non-smokers. You might also find that overweight people could be charged slightly higher premiums too, as will people in jobs considered to be high risk.
For auto insurance, your choice of car can affect the amount you pay on premiums, while income protection insurance premiums can be affected by your choice of employment.
Consider Carefully
Before you buy insurance, always take the time to understand what you're paying for and how various aspects of the policy can affect your premiums and coverage levels. There's no point paying for more insurance cover than you really need, but likewise, you need to be sure you have enough cover to protect you in the event of something happening.