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What insurance to buy and what insurance not to buy

Date: Apr 02 2010
Filed In: Auto Insurance101

When you talk about auto insurance, there is the obvious things, your house, your cars, your health, your life but in actuality, you can insure almost anything. Your wedding to your pet, of course you probably cannot afford all of these insurance.

The insurance industry is happy to sell you insurance just about anything you want. There are four things you need to keep in mind regarding insurance.

The first one is to cover big risks, only risk that will financially devastate you need to be insure. For example, if you are the breadwinner of the house with kids, get life insurance for yourself so your dependents can take care of themselves and pay the bills if something happen to you.

Second, do not over insure. Buy the right kind of insurance and with the right amount. Don’t buy too much, avoid policies that only paid on certain events were only cover a certain loan.

Cancel coverage that you don’t really need. For example, disability is important to ensure your income that if you can’t work you still have income to pay your bills but when you’re retired you don’t need disability coverage. Many retired people keep it but they should cancel it.

Keep your emotions out. Do not buy insurance for emotions reason, it should be an objective reason. If you are very emotional about a recent tragedy, wait and cool off for a little while before you buy insurance to cover your family.

Insurance for weddings, this is very popular in the UK and is now taking a hold of the United States. You can buy insurance that cover the facility cancellation fee, no-show photographer, stolen gifts and even policy to cover if the bride or groom get cold feet. The wedding insurance can cost about 1 to 2% of the wedding ceremony. Deal with reputable insurance companies that will give you the refund if something wrong happened. In general, you don’t need to buy this, just make sure you are careful when planning your wedding and with the wedding services.

Travel insurance is really three components. One, trip cancellation, two personal items coverage, and travel medical coverage. Trip cancellation fee and personal items coverage, make sure you deal with a reputable travel insurance agency. If you have to cancel your trip it will be refundable back to your credit or cruise line. Buy the cancellation waiver only, which is 40 or $50. Because travel with trip cancellation can cost $500-$700, cancellation waiver cost a lot lower. Check your homeowner policy it may cover that or if you book your trip on your credit card it may have cancellation coverage and personal items coverage.

Travel medical insurance is important if you are traveling abroad especially for rock-climbing, scuba diving, any kind of extreme activities. Your health insurance may not cover emergency medical attention or emergency medical evacuation, so check your health insurance policy and you may want to buy travel medical insurance.

Something else is getting very popular right now is buying insurance for your pets. The trend is people are humanizing their pet and treating them as family members. There is pet health insurance coverage for routine treatments, exams, x-rays and surgeries. The average cost is about $30-$40 per month or $350-$500 per year. Our advice is only cover something will put you at financial risk and pet insurance is not something we would recommend buying.

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