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Saturday, October 22, 2011

5 Types of Insurance That You Don’t Need



There are different type of insurance policies some are compulsory and some are not. According to law one must have to purchase car insurance and health insurance in order to secure car damaging and health problem costs. People buy insurance policies to cover the possible future financial losses. There are so many types of insurance policies but it’s not like that all of those are essential. There is some type of insurance policies which you really don’t need.

The other type of life insurance policies like life and disability are also important but not obligatory.  These types of insurances are beneficial for securing your future, depending on a particular situation. These above mentioned type of insurance policies are important as it benefit you for your future problems, but there are various insurance policies that really are not essential for you to buy. You will get many insurance agents that will sell you insurance which you actually don’t need. Though such types of insurances would give you some sort of protection, but on the whole those are unnecessary.

Here are the insurance types which really are not so necessary to buy:

1 – Mortgage Life Insurance


Some insurance agents would try to convince you to buy mortgage life insurance. This life insurance is designed to payoff your mortgage if you die before your mortgage terms are fulfilled. As a matter of fact this type of insurance in most of cases is not needed. Because your life insurance policy will do same, so it better instead of buying a separate mortgage life insurance you should make sure that your regular life insurance coverage is sufficient to pay off your mortgage.

Never combine or mix your mortgage life insurance with private mortgage insurance (PMI). If you cannot have 20% for your down payment then there is a chance that you have to buy PMI to help protect the lender in the event that you default.

2 – Identity Theft Insurance


As identity theft is a fast growing crime now a days that’s why many people are concerned about it. You must have to watch over your accounts and credit reports for identity theft. It’s good to have more security on your reports and making it difficult for credit accounts to be opened in your name. Identity theft insurance won’t do anything more than as you can do. But difference is that identity theft insurance is not free of charge and it may not provide to adequate protection. In this case identity theft insurance is not so important that one must borrow it.

3 – Cancer Insurance


If you are healthy and still no health problem then it’s rare that you will end up with cancer. So it’s necessary to buy cancer insurance as can insurance can void some of the coverage in your regular health policy. Cancer policies are also having many loopholes in them, which can prevent a payout. Its better that you double check your health policy before going for a specific disease coverage policy. Check you health insurance that it is adequate for hospitalizations. Same like that stroke and heart attack insurance is also not necessary as your comprehensive health policy will cover that all.

4 – Payment Protection on Your Credit Card


This is for making payment for your credit card when you are unable to pay those due to of certain conditions. This payment makes minimum payments for you, until you are not able to pay back yourself. But this protection will get pricey as it’s based on your credit card balance.

But for such condition you can have better options such as consider disability policy that includes debt payments. Same like that life insurance policies can pay off your credit card debt also. You can also build an emergency fund which will help in such situations.

5 – Collision Coverage on Old Cars


Though auto insurance is obligatory but on old cars its comprehensive coverage is not necessary. As your car will get old and its value will decline, your car will not be worth to have collision coverage. Calculate if your car collision coverage is costing too much for what you could get potentially from the insurance. Its best to break down what each portion of your coverage costs, this will help you to decide that comprehensive coverage on your car is worth or not.

1 comments:

Jenice said...

There are so many insurance policies that exists each of which seems to be a profitable option. It makes really difficult for a person to know which plans are needed. Thanks for suggesting which type of insurance that person doesn't need.
small business insurance

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