10 Most common insurance myths

Insurance policies have become an important part of life with the increase in risks related to life and accidents. These policies can be very complicated and surrounded with a lot of false information. You must not believe everything you hear, because there are many myths associated with your insurance policies. 

The 10 most common myths are as follows: 

1. Benefits should equal premiums:

 Your policy is your buffer against severe financial problems and not to be used for daily ups and downs in life. You must not feel cheated if you have been paying premium for years and never made a claim. 

 2. Everyone needs life insurance:

For some even this policy is unnecessary. The policy is designed to give financial care to your dependents. This includes your children or any elderly person who depends on you. If you do not have any dependents, then you may not need the policy. 

 3. Only the breadwinner needs to be insured: 

It is generally believed that only the person who earns in the family needs to be insured. We tend to forget that duties such as house care, food preparation etc also must be taken into account. Thus a non-working spouse also contributes greatly to the budget; therefore even he or she should be insured for life.

 4. Your car not your responsibility if someone else drives it: 

Even if someone else is driving your car and causes an accident, you will be financially held responsible for it. 

 5. No need to insure old cars: 

According to statistical information old cars are the ones that get stolen the most, because it’s easier to steal them. 

6. Company will pay for a rental car if your car gets stolen:

This is not automatically included in your policy. Even if you have comprehensive and collision coverage the policy will not include a rental car. 

7. You need flood coverage only in a high risk area: 

All areas under a National Insurance Program are eligible to buy flood insurance. You must be insured if you live in a flood prone zone. 8. Umbrella insurance is for rich people: As lawsuits occur so commonly now, this policy is for all home, auto and watercraft owners and not just for the wealthy. 

 9. You don’t affect others when you don’t get insured:

 If you decide to be uninsured, you are indirectly affecting the lives of others. This will include the lives of those who are dependent on you. 

10. Red cars increase your policy premium: 

Many drivers think that car color is an important factor when it comes to paying premiums. This is not true at all.