Unnecessary insurance provides duplicate coverage or protects against small losses. For example, credit life insurance and rental car insurance may duplicate existing policies.
Life Insurance Considerations
Life insurance premiums are expensive. You may be better off investing the money. Most buyers never collect on their policies after paying for years.
Some collision coverage is unnecessary if you own your car outright or it has little value. The cost may exceed the car’s value.
Redundant Coverage
Flight insurance typically duplicates coverage you already have through airlines and credit cards.
Homeowners, renters, health, disability, and auto insurance is essential. Additional coverage like stroke insurance is likely redundant.
Mortgage life insurance duplicates regular life insurance. Your life policy would pay off a mortgage if you pass away.
Insurance Review and Assessment
Assess your needs and existing coverage before purchasing extra insurance. Policies that may be unnecessary include:
- mini-med
- accidental death and dismemberment
- extended warranties
- rental car insurance
Regularly review policies, especially after major life events. Needs and relevance change over time. An advisor can help tailor appropriate coverage.