never really cared for, comes
to visit you. Upon leaving,
which you have not yet had a chance
to fix since your holiday party a week
ago. She assures you she is alright,
until you get a letter in the mail from
her attorney. She is suing you!
word. However, the sad reality is that it
isn't really an option; it's a necessity. It's
also not just about having insurance; it's
about having the right kind and the proper
amount to give you protection you need
against the unimaginable.
going to focus on the two most prevalent
and important ones auto and home.
required to purchase homeowners
insurance as a condition of your mortgage.
The key, however, is having the right
amount of insurance and keeping it up
to date. First there is liability insurance.
This is what is going to protect you from
Aunt Sylvia's lawsuit. How much liability
insurance should you have? There are
generalized standards within policies but
you need to determine what suits both
your budget and gives you peace of mind.
Legal and medical bills add up quickly and
liability coverage will take care of the bills.
Not having this type of insurance could
mean losing everything you have just to
cover ONE lawsuit!
It may seem like a good idea to purchase a
minimal $25,000 personal property policy
but if there were to be an emergency, i.e.
a storm like Sandy or a fire that destroyed
everything you own, there's a good chance
that $25,000 would barely make a dent in
replacing your furniture, your clothes, and
all your possessions.
valuable, like jewelry, art, or a musical
instrument you will need to have a
special rider on your policy to protect
those particular things because they
will likely NOT be covered under your
standard policy. These pieces will need
to be appraised and photographed and
submitted to your insurance company.
You may never be able to replace your
grandmother's antique clock, or your
family heirloom engagement ring, but
being compensated financially will enable
you to either get something new or use
that money for bills or other expenses,
especially in this difficult economy. If your
house is robbed your jewelry could not be
replaced but the money you collect could
pay your mortgage for many months.
Usually apartment complexes require
renter's insurance when you first sign
your lease, but many people forget to
renew it every year. I know a woman who
recently had a fire in her apartment. She
never renewed her policy. While the fire
was restricted to only her apartment, she
was responsible for $10,000 in property
damage! A renter's insurance policy
would have cost her about $100 a year.
Had the fire spread she would have been
responsible for a lot more, including a huge
liability suit had someone been injured
or killed. She said the reason she didn't
renew her policy was that the paperwork
was a nuisance. I can assure you, she is
regretting it as she tries to figure out how
to pay the apartment complex $10,000 in
damages and replace her belongings. She
has now purchased renter's insurance; but,
that's closing the barn doors after the horse
has already left!
are many ways to get discounts. Some
companies will offer discounts for college
degrees, alumni discounts for certain
schools, discounts for multiple vehicles,
and if you bundle your homeowners
discount. One of the best kept secrets of
the auto industry is taking a safe driving
class. This can be done online for about
$25 and it will take about $100 off your
premium each year for every driver in the
house that takes it, for three years. It's
certainly worth $25 to save $300 per driver!
Ask questions when you apply for quotes;
ask about discounts for college degrees,
alumni associations etc.
people forgo collision insurance to save
money. This is a bad idea, unless your
car is so old it's not worth anything. If
you had a serious accident or totaled
your car you'll be counting your blessings
that you had collision coverage and it's
important to make sure medical benefits
are also covered in your auto insurance
policy, especially if you don't have health
insurance or don't live in a no-fault state.
Even if you have health insurance, your
auto policy will pick up the tab (or most
of it) before your regular health insurance
has to pay. Another thing to ask about with
auto insurance is whether or not they will
provide you with a rental car while your
car is being repaired. This can be a huge
savings, especially if your car is going to be
in the shop for an extended period of time.
Some insurance companies also include
roadside assistance as part of your policy.
but when a catastrophe strikes usually
at the worst possible time the peace of
mind, not to mention the check in the mail
will make it all worthwhile!