Common Misconceptions About Personal Insurance

Personal insurance can appear like a daunting, complex maze. It’s easy to get overwhelmed with all the jargon and options and costs. You don’t know what you need, or don’t need. We’re here with you every step of the way, and we want you to understand everything about our products.

What Is Personal Insurance?

Personal insurance is the terminology used to talk about any insurance that can be obtained for your protection against having to pay out of pocket for things like automobile accidents, healthcare costs, or property damage. These generally include, but are not limited to: auto insurance, homeowners insurance, health insurance, life insurance, rental or rental property insurance, and umbrella insurance.

Common Myths About Personal Insurance Policies

Many people have at least some degree of misconception about the different kinds of insurance. Rumors, urban legends, myths. It can be difficult to differentiate fact from fiction. Since we at JMG field a lot of questions, we will here seek to put some of these rumors to rest.

Homeowners Includes Flood Coverage

Homeowners insurance policies do not come standard with flood coverage. Not all homeowners have a need for it. Those who reside in high risk flood areas and obtain their mortgage through a federally regulated or insured lender are required to carry flood coverage on their homeowners insurance policy. Those whose homes are in low to moderate risk flood areas are not required to have flood coverage. When speaking with a personal insurance agent, one of the things you will be asked is whether the home is in a high risk flood area or not. Then they can let you know if you need this specific coverage.

Life Insurance Is Too Expensive

One of the top reasons that people put off getting life insurance is that they think, or have heard, or were told, that it’s too expensive. While it is true that life insurance premiums do increase with age, if you get a life insurance policy at a younger age, you can lock in a lower rate. The logic of this is that the older you get, the more health conditions you’re likely to develop. The worse your health becomes, the more likely you are to need to utilize the policy. So, even if you think you may not need it because of being young, or single, it’s more cost-effective to lock in that premium as early as you can.

Car Color Determines Auto Insurance Price

Everyone knows that the monthly premium for a candy apple red car would be astronomical, right? Wrong! There are a lot of factors that go into the price of your auto insurance premiums. Your car’s make, model, body type, age, sticker price, engine size, cost of repair, likelihood of theft, and overall safety record all play roles in insurance cost. More factors taken into account are your driving record, age, and credit history. So while there are quite a few factors that determine the cost of your coverage, the color of the vehicle is not one of them. So feel free to buy as many extravagantly colored vehicles as you can afford.

Only The Rich Need Umbrella Insurance

Umbrella insurance is a less often utilized coverage option. This is due to the fact that, for some reason, people feel like only those in a higher income bracket can benefit from the coverage. Umbrella insurance protects you from costs that are not covered by your other personal insurance policies. The misunderstanding lies with the idea that having a lower income, and fewer assets, means that there’s a greater chance that any incidents that arise would be covered under the policies you already have.

The problem with this is that in the event that a situation arises in which costs are higher than your coverage, you will have to pay out of pocket for those. Umbrella insurance is an inexpensive way to ensure that you will always be protected, even if your other policies are stretched past their limit. In truth, it could be said that the rich are the ones who can afford to go without umbrella insurance, and those with lesser assets are the ones who can’t go without it, or rather shouldn’t.

Landlords Will Cover Property Damage

If you are a renter, you should always have renter’s insurance. Your landlord will have rental property insurance, which does not cover any damages that may occur to your property. For example, if the house was to catch fire and burn completely to the ground, that rental property insurance does not include coverage to replace any of your personal possessions which are lost in the catastrophe. The only way for your personal possessions to be covered would be to have your own insurance policy to cover them, or a renter’s insurance policy.

Work With A Qualified Personal Insurance Agency

JMG Insurance Corp has been in business for over 100 years, and as such, we are experts in helping you navigate the waters of personal insurance. Speak to one of our professional personal insurance agents today about your insurance needs.