4 Questions My Insurance Clients Never Ask—But Should

By Linda Rey

Wouldn’t it be nice to have a crystal ball to predict when an emergency will strike, so we could buy just the right amount of insurance at the exact moment it’s needed?

Alas, it’s not possible. My clients don’t always want to face their worst fears, but it’s important to be prepared for the worst-case scenario.

Here are four questions I wish every client would ask to make sure he has the best insurance coverage to protect himself and his family.

What happens if I wait to buy life, disability, or long-term care insurance?
I like to think of getting older as getting wiser, but the sad reality is that with each passing year our bodies get a little slower. Some may have a few more years than others, but we’re all heading to the same destination. That means every year we become a higher risk for insurance companies.

If you wait, it will cost you more. Even if you remain in good health, the rate increases each year. With every passing year, there is the chance that you could be diagnosed with a medical condition. That will cost you more as well. If your blood pressure or cholesterol increases, that will cost you, too.

The bottom line is every year you wait to buy life, disability, or long-term care insurance will cost you more money in premiums.

Do I have enough coverage?
Instead, the question I hear most often is “How much does it cost [for the absolute basic/minimum I’m required to buy]?”

Reality strikes again. How do you protect yourself in the case of a lawsuit? Consider analyzing your assets and what could possibly be exposed if a lawsuit is settled against you. If your liability limits on your primary policies are insufficient, consider purchasing an umbrella policy.

Do I have replacement cost on my homeowner’s policy?
Lenders ask us about replacement cost when someone is securing financing for a mortgage, but most clients aren’t aware of this provision. Replacement cost helps provide for inflation and cost-of-living adjustments. Depending on the carrier, this provision could be 150 to 200 percent of the dwelling limit, or unlimited. It’s important to be aware of the limit, in case you experience a loss at some point in the future and it costs more to rebuild.

Does my auto carrier offer “accident forgiveness”?
The answer is the insurance standard “It depends.” Many carriers now offer this. Some include it at no additional cost, while others do for a small premium. It is absolutely beneficial. Be sure to ask your agent or carrier about eligibility and the financial benefit of having this provision. If you’re looking for ways to save money instead of spend it, this may be helpful.

Be ahead of the curve with your insurance coverage. People are worried about how much to save. What should also be considered is how much it will cost you if you don’t spend a little to save a lot.

Linda Rey is a licensed insurance agent at Rey Insurance with a broad spectrum of expertise in life, accident, health, property and casualty insurance as well as retirement planning and college funding strategies.

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