5 Common Mistakes People Make When Purchasing Insurance

Most consumers today will have multiple insurance policies. Some of the most common policies can include Auto Insurance San Diego, CA, homeowners, life, and medical. While buying insurance is commonplace for many people, there are still five common mistakes that people will make when buying insurance.

Over Insuring

The first mistake that many people make when buying insurance is over-insuring themselves. Insurance providers make more money when selling you a policy with more coverage. While this could provide you with a sense of more security, having more than you need can end up being completely worthless in some cases and could be a waste of money.

Under Insuring

While some people over-insure, others can make the mistake of under-insuring. When buying a policy some people may choose a policy that barely covers the minimum requirements set forth by your state or loan agreement. While this may allow you to comply, you could suffer financial hardship if your policy does not end up providing you with the coverage that you to offset your loss.

Picking the Wrong Provider

A big mistake that people can make when buying insurance is picking the wrong insurance provider. In some cases, there can be dozens of insurance providers to choose from. While some may offer low rates, they may have a reputation for being resistant to pay on valid claims. To ensure you pick a good provider, you should spend time reading consumer reviews and making sure the company has a positive AM Best rating.

Not Shopping Around

Many consumers that buy insurance make a big mistake by not shopping around for their policies. Some consumers believe that all insurers will provide essentially the same coverage at about the same cost. However, all insurance providers have a different pricing and underwriting process, which means that one insurance company could provide a much different rate than another. Because of this, it would be a good idea to get insurance rates and proposals from at least a few different companies to ensure you get a good deal.

Not Bundling Policies

Many consumers also make the mistake of not bundling their insurance policies together. Many consumers have multiple insurance policies, including home, auto, and life, which could all be provided by the same insurance company. When combining policies, many insurance providers will offer a substantial multi-policy discount. Neglecting to take advantage of this discount could end up costing hundreds of dollars per year.