4 Common Insurance Myths

Insurance is a common part of life, but many people don’t understand it or have the wrong information. Believing these misconceptions could really end up costing you, often at a time when the last thing you need is another headache. 

So, don’t be someone who falls for common insurance myths. Here are four ideas to get you educated. If you want to speak to a professional about the ways insurance can protect you and your family, reach out to Farm Bureau.

Myth #1: I’m Too Young to Need Life Insurance

There are all kinds of reasons why people think that they don’t need life insurance. Someone might believe this myth because they have coverage through work. Other times, it’s because they don’t have children or other dependents. But the most common reason people believe they don’t need it is because of their age.

If you’re young and healthy, that’s great! It’s also the perfect time to get life insurance. When you’re in good health and young, you will benefit from lower rates, which means that you’ll ensure you have the coverage you need for the long haul.  If you wait until you get older, developing health conditions might prevent you from getting lower rates or qualifying for coverage.

It’s also a good time to consider permanent life insurance. Permanent polices build cash value that can be accessed in the future for emergencies, planned expenses or to supplement retirement income. So, life insurance isn’t just “for old people”. The sooner you get it, the better off you’ll be when you actually need it. To cover your bases, here are all the life insurance myths you shouldn’t believe.

Myth #2: Auto Insurance Won’t Cover Me if I Cause an Accident

Some people believe that if they’re the person who causes an accident, then auto insurance won’t cover them at all. But this is a common car insurance myth, and it stems from a lack of understanding about the types of coverage available. In fact, certain policy coverages are designed to provide coverage for an accident that you cause. 

The reality is that there are a few kinds of auto policies, some required by law and some not depending on your state and whether or not you own or lease the car. Check with your state’s automobile insurance policy requirements.  

1. Liability coverage: Required by law in most states, liability coverage provides protection for damage resulting from an accident for which you were deemed to be legally responsible. The bodily injury coverage portion may cover some of the injuries inflicted on the other party, while property damage coverage typically covers some of the damage inflicted on the other party’s car and/or property involved.
2. Collision coverage: This insurance coverage is not required by law. Collision coverage provides coverage for damage to your own car resulting from an accident. Be aware that collision insurance typically doesn’t cover non-driving-related incidents like theft, flooding and vandalism.
3. Comprehensive coverage: This insurance coverage is not required by law. This coverage helps cover some of the costs that collision insurance doesn’t. Comprehensive insurance can be useful if a car is stolen, ruined in a fire or damaged by an animal.

Some automobile insurance plans offer wide-ranging add-ons, including coverage for rental cars, personal injury protection, flood damage and theft. Other policies may only cover damages you are legally responsible for another party involved.

Reach out to Farm Bureau to learn about your options to make sure you’re covered in the case of an incident. 

Myth #3: Homeowners Insurance Always Protects My Valuables

It’s great if you have homeowners insurance, but your heirloom jewelry may need additional coverage.

In your policy, coverage limitations may apply to your personal belongings, especially to high-value items. And in fact, things that you consider part of your home may have limited coverage, such as a property when not located in your home, jewelry or collectibles. 

It is also important to understand your policy’s covered causes of loss.   Additionally, homeowner policies also contain exclusions.  For example, damage caused by floods might not be covered.

Your Farm Bureau agent will be able to discuss the details of what’s covered — and what’s not — under your homeowners policy.

Myth #4: I Work From Home, So I Don’t Need Business Coverage

Your typical homeowners policy will protect you if your home is damaged, but it won’t cover your home-based business completely. What if someone is injured on your property? What if you use your car for your business? What if you’re traveling for work?

If you have a home-based business, you’ll need to consider these common small business insurance myths to ensure you’re adequately covered.

Insurance Myths Debunked

Reach out to Farm Bureau to get the facts on the insurance products we provide. Contact us today!