sive rain or hail storm can wipe out a year’s crop. For this reason, the vast majority of farmers elect to ensure their crops on an annual basis.
What To Look Out For
A wise man once said, “Insurance is sold, not bought.”
While insurance can be a life-saver, it is important to understand that just like an auto dealership or a cable company – insurance is a for-profit business.
Insurance companies spend millions of dollars each year advertising their services and employ thousands of insurance salesmen across the United States in an effort to reach consumers. Many of these salesmen are paid on a commission basis, meaning the more insurance policies they sell, the more compensation they earn.
Keep this in mind when speaking with any financial advisor or insurance agent. Don’t hesitate to ask how they are paid on the policy they are recommending. If they won’t provide you a straight-forward answer, considering looking elsewhere. Any insurance agent who has your best interest in mind will not have a problem explaining to you how they are paid, and the benefits of the policy they are recommending.
Reading The Fine Print
At its core, an insurance policy is a contractual agreement. In exchange for your monthly premium, the company is agreeing to cover the event being insured. Any events which are not explicitly included in the insurance policy will not be covered.
There are horror stories of individuals thinking a specific event was covered within an insurance policy, only to learn later that the event is not. The best way to protect yourself from this is by reading the fine print and having a detailed conversation with your insurance provide. Ask them “what if” until you completely understand your coverage under the plan.
What if a pipe bursts, is this covered in flood insurance? What if my phone is damaged, but not lost, does the phone insurance cover this? If we leave our door unlocked, will renter’s insurance still cover stolen items? Ask these questions before you sign on the dotted line.
Insurance can be a fantastic thing. Many people have had their life savings protected during a house fire, major health scare or car accident. Carefully consider the risks in your own life and see how insurance can help mitigate these risks. You may be happy you did.