Insurance is something many of us don’t think too much about. Often, it’s only as a result of an event that we even consider buying insurance. Like when we get a mortgage, start a family, or lose someone we love. The fact is, buying insurance isn’t always a simple purchase and there are a few things that can go wrong. If you’re reviewing your insurance options, look out for these five insurance mistakes that many Kiwis make, and consider how to avoid them.
1. Not getting insurance
One of the biggest mistakes that people make is putting off buying insurance for another day. Sometimes it just feels too hard to make a decision about which type of insurance you need. Or you may feel lost in all of the jargon that often goes hand-in-hand with insurance paperwork.
But the fact is, the longer you leave buying insurance, the harder – and usually more expensive – it gets. And it could even mean not being able to get insurance when you do decide you need it. That’s because age is one if the biggest determining factors when it comes to how much you’ll pay for insurance. And as you age, so you’ll find it harder to get insurance.
2. Not having enough insurance
Insurance is meant to protect your family’s financial security should something happen to you and you are unable to earn an income. A policy lacking in coverage can leave your loved ones struggling financially when things go wrong. Being underinsured – having too little insurance - is almost as bad as not having insurance at all.
Finding the right amount of cover can make all the difference when it comes to your family’s financial assurance, so it’s worthwhile discussing your needs with your insurance adviser, who can help you find that sweet spot between too much cover and too little cover.
3. Not disclosing all the necessary information
When you apply for insurance, the insurer asks for information that allows them to tailor and price your insurance policy according to your specific situation. Non-disclosure refers to information that you may not have thought relevant or may have deliberately left out at the time of your insurance application.
Not disclosing certain information – whether deliberate or accidental – could impact your claim when things go wrong. If the insurer decides your claim was caused by something that was already evident when you took out the policy, your claim may be turned down. That’s why we recommend that if you are in doubt, rather over-disclose.
4. Not reviewing your policy
Just as your circumstances can change, so too should your insurance policies evolve. Adopting a set and forget attitude could leave you short when you need to claim or mean you’re paying too much for your insurance needs.
At key stages of your life – when you get married, have children, take on significant debt like a new home – it’s important you review your insurance policy to ensure you have the right amount of insurance cover for that stage of your life.
5. Buying insurance without good professional advice
Buying life insurance is easily one of the most important financial decisions you’ll ever make. After all, your family depend on you financially, so it’s important you make good decisions about the type of insurance cover that will take care of them when you can’t.
Getting advice from an insurance professional – like a Mortgage Express branded insurance adviser – can make all the difference. Not only can an insurance adviser help you find the right cover so you’re not paying too much or being left without enough cover, an insurance adviser can also review your insurance each year and help you make changes to your policy as your life situation changes.
Get in touch with Mortgage Express today to find an insurance adviser in your area.