If you are considering taking out personal risk insurance, there are four common mistakes that people tend to make. Whether it’s income protection, mortgage protection or redundancy insurance that you are after, be sure to avoid these blunders so your family is not in the lurch should the unthinkable happen.
1. Don’t leave it too late.
Often people simply leave it too late to sign up for personal risk insurance. If you are young, fit and healthy then it may appear to be an unnecessary expense. However, the truth is not being covered by a good policy could leave your family in a difficult situation should anything happen to you. What’s more, waiting until you are older to take out these types of insurance could mean that there are limitations on your policy due to your age or any underlying health issues. Sadly, the unexpected does indeed happen to people all the time so don’t put the future of your family at risk.
2. Not having enough cover.
Underestimating your insurance needs is another common mistake that people make. Although you may be paying lower premiums, it also means that if you were to make a claim the amount of money you and your family receive is not enough to meet your needs. So, read all the small print, crunch all the numbers and make sure the policy is sufficient to cover your lifestyle expectations.
3. Failing to advise your insurer of any changes in your personal circumstances.
Your personal circumstances and family situation can change over the years. Entering a new stage of life can affect the values set in your insurance policy leaving you under- or indeed over-insured. Review your policies on an annual basis to make sure they are still working for you. And be sure to advise your insurer if, for example, you get married, divorced or have children.
4. Not using an insurance broker.
We can all use the internet to identify insurers and apply for insurance cover online, but it is a time consuming and confusing process. An insurance broker, on the other hand, knows all the ins and outs of the insurance industry. They can quickly and easily tell you in everyday language what’s included in the policy and what’s not included. What’s more, often they are able to negotiate on your behalf so that you enjoy better coverage and lower rates. Using an insurance broker can, therefore, save you time, money and hassle.
The Bottom Line
Avoid making the same mistakes as others and ensure you have adequate personal risk insurance. Take the time out now to consider what would happen to you or your families if you were to fall ill or suffer an injury or disability. Adequate insurance will provide peace of mind knowing the future of your family is secure should the worst happen.