Can I be over-insured?
Ask most insurance agents, and you’ll get the same answer: “You can never have too much insurance” they’ll say. Well, if that were true then we’d all be insuring our chest hair like Tom Jones, or our booties like J-Lo. Tom and Jen aren’t over-insured. You, me, and pretty much everyone you know, would be over-insured with those policies.
Being over-insured doesn’t have to just be about some money-making body part. There are many ways you can become over-insured. These are the policy types that are most often selling you more than you might need:
1. Homeowners Insurance
At first glance you might think…”A-ha, I knew it!” but I would bet that’s because of the replacement value on your house. Likely (as in 82% of homeowners), that amount is probably too low. Rather, the oft over-insured elements of a home policy come with the add-on endorsements. Do you have a sump-pump? If not, you could probably remove the Sewer & Water Back-Up coverage from the policy. If your furnace breaks, do you plan to make an insurance claim? If not, then you could reconsider the Mechanical Breakdown endorsement.
2. Business Owners Policies (BOPs)
There are numerous examples of business owners’ policies being endorsed into something that more resembles a Fortune 100 company than it does a local main street business. If you’re a small business owner, review your policy endorsements. Some of the usual ones like Loss of Income, Employee Theft, and Data Breach can often be insured too high, or not needed at all.
3. Car Insurance
Usually, a car insurance policy has a considerable amount of under-insured areas. There are still a couple of areas worth taking a 2nd look at that you are paying for, yet will never use. The first is Roadside Assistance (aka Towing & Labor). If you are someone who has a membership with an auto club (like AAA) which tends to provide greater benefits, then why pay the extra premium for inferior coverage on your auto policy? Another one is Rental Car Reimbursement. This coverage pays for a rental vehicle when yours is laid up due to an accident. There is a set dollar amount that the policy will cover, and that ranges significantly from carrier to carrier. However, this endorsement isn’t available if your car is simply in the shop for repairs. If you have another available vehicle in your household that you can use, then this is another one you could let go of.
These are just a few examples of times you could find yourself over-insured on a property and casualty insurance policy. Even though there are times when we can be overly insured, most of us are under-insured. Sometimes it’s a matter of removing one unnecessary endorsement and replacing it with one that you actually could need. That is why we review your unique situation and create policies specific to your greatest areas of risk.
What’s my next step?
The Horan Companies team of insurance professionals is here to help guide you through those insurance decisions. Call or contact us, and remember, we will not spam you or sell your information. To make it easy, we’ve added a short inquiry form below. Give that a quick fill-in and one of our insurance pros will reach out. We’ve got you.