3. Over-insurance
Worse than paying too much for insurance you need is paying at all for insurance you don’t need. Insurance companies play on your fears of what could happen, leading you to buy up that life insurance policy or extra rental car protection that you’re extremely unlikely to need.
According to InsuranceQuotes.com, 84 percent of Americans don’t ask for basic discounts in their insurance. “These discounts can add up to hundreds of dollars per year, and in many cases, they reward people for things they were already doing,” Laura Adams, a senior analyst, told Forbes.
As NerdWallet explains, a 35-year-old man would pay more than 10 times more each month for a $500,000 whole life insurance policy than he would for the same amount of term life insurance. It may also be a case where you’re carrying outdated life insurance riders, or that you have life insurance you just plain don’t need.
