6 Insurance Policies You Don't Need
Paying for insurance may be one thing that we love and hate to do. You love the idea of providing for you and your family’s future, but you hate the idea of paying premiums each year for health, dental, optical, auto, homeowner, life, disability, long-term care, and umbrella liability coverage. As we all know, there are so many insurance policies out there, wherein some are offered by Philippine Prudential Life. There are some which are important, such as those from Prudential Life or PPLIC, but there is also some that can be thrown at garbage. Here are some insurance policies that you don’t need:
Private Mortgage Insurance- The private mortgage insurance (PMI) is well known to homeowners because it increases the amount of their monthly mortgage payments. PMI is an insurance policy that protects the lender against loss when lending to a higher-risk borrower. The borrower pays for this insurance but derives no benefit. If you fail to make your payments, the policy pays off -- but it pays the lender, not you or your family. Thanks to rising home values, you might now have 20% equity in your home. This type of policy is very narrow in its coverage and therefore is probably not the best use of insurance premiums.
Flight Insurance- This policy is a waste of money because the chances that you’ll die on plane crash is remote. Check with your credit card company, because some automatically bill you for the coverage when you buy a ticket. Even without this coverage, if you die in an accident, the airline is likely to compensate your family. But still, it is advisable to have a life insurance no matter what the cause of your death is.
Cancer Insurance- Cancer Insurance is now rampant in all places. The reason this is generally such a poor insurance choice is that first of all, your primary health insurance generally covers medical expenses related to cancer treatment. Most cancer insurance doesn’t cover skin cancer, which is one of the leading types of cancer. It is still the health insurance that you should buy instead on wasting money on cancer insurance.
Rental Car Insurance- Majority of car insurance covers car rentals, making this a useful feature if ever you are involved in a car accident. This may sound like a good idea, but in reality, most people rarely rent a car, and when they do, the cost is relatively low and hardly worth insuring against.
Flood Insurance- Unless you live in a flood prone area or places with water problems, you may buy this. If none of the homes in the area has ever been flooded, yours is unlikely to be the first. Only 20% of American homes at risk for floods are covered by flood insurance. Most private insurers do not insure against the peril of flood due to the prevalence of adverse selection, which is the purchase of insurance by persons most affected by the specific peril of flood.