Common Personal Insurance Misconceptions

Here are some matters to keep in mind when evaluating your policies:

• Speak with a professional: Independent insurance agents are here to help you evaluate your risk and identify the best coverage for you. Insurance Journal, a publication dedicated to consumer and commercial insurance news, states 52% of U.S. adults do not actually know how to best insure their houses. .
• Due diligence for home policy evaluations: For example, many think that flooding is covered by their homeowners insurance, but this is not true in most cases; a separate flood insurance policy is normally required for this coverage to apply. Make sure you understand your policy, including both what it does and does not cover.
• House coverage limit on your homeowners insurance: Many homeowners will think they should base their home coverage limit on the market value of their homes. Experts suggest acquiring coverage in accordance with the cost of rebuilding the house from scratch, in the event of a total loss. This amount is often quite different from the home's market value, which is dependent on market factors, location and more. A home's rebuild value is determined based on features, construction materials, labor costs and more.
• Where responsibility falls in automotive accidents: The Insurance Information Institute, an insurance research organization, found car owners will often think their policies do not apply if drivers other than themselves get into an accident while driving their vehicles. In most states, it is the owner's insurance that would apply, not the driver's.
• The meaning of "comprehensive": Insurance Journal also noted that nearly one-third of adults believe comprehensive coverage actually protects them against any and all damages in auto insurance, but this is not true. A range of risks, such as a common collision, are usually not covered under the comprehensive portion of an auto policy.

These are just a few of the many misconceptions, myths and complexities involved in insurance that so many consumers fall victim to every year. Going it alone when researching, purchasing and maintaining an insurance policy might be the greatest risk of all these days.