Six most common insurance mistakes you should avoid

Not insuring to save money: This is one of the most common mistakes one does by not having insurance in order to save money. This may be a very costly mistake for you. Some of the insurance that you definitely need to have is a basic health insurance policy, car insurance and life insurance.

Buying insurance purely based on price: It’s a common behavioural trait of consumers that they are sucked by the low prices. While low price is important to buy an insurance ignoring the quality and coverage may cost you much.

Insuring what is not required: It is not uncommon to find people having life insurance without any dependents. Many of us also buy insurance for our computers, TVs etc, which may not require or should be at a minimum. Over-insuring yourself and paying high premium is also a type of insurance that you actually do not require.

Ignoring insurance that is critical:  Another common mistake is not insuring for something that is important. For example, many of us fail to insure our self for disability coverage that may be important in case you could not work due to some untoward event.

Insuring based on the chance of happening of an event: Many of us believe that certain things cannot happen to us and hence do not guard our self against these events. For example, if you are moving in a desert, you may not buy flood insurance as it is a waste of money for you. However, the fact is that floods can happen anywhere.

Insuring against specific cases: Carrying accidental death insurance or a policy for Alzheimer’s are the cases of insuring yourself for too narrow and specific cases. Instead go for insurance that pays you in case of your death, irrespective of the cause. Moreover, buy a comprehensive healthcare policy to cover all contingencies.