Money Chump

Insurance is a serious and rather sober topic, not something to crop up that regularly in casual conversation.  If you have thus far avoided the subject at the office water cooler or at your favourite bar on a Friday night, you may be largely ignorant of the field.  Unfortunately, when it comes to insurance, ignorance is rarely bliss.  When you lead a busy life, researching insurance may be one of the last things on your ‘to do’ list, so to get you started, here is a brief guide to getting the most out of insurance.

Insurance cover can be a complex subject.  Get things rights and you can in effect purchase peace of mind.  Neglect to read all the small print and you can be in for a nasty surprise on the back of an already unfortunate event.  The first, most essential piece of advice is to thoroughly investigate the cover on offer.

All insurance policies have very specific definitions of a qualifying claim.  In general, the more you pay, the more eventualities will be covered by the policy.  However, all insurance, no matter how expensive, will contain exclusions and limitations that can lead to claims being rejected just when you need financial support the most.  Make sure that you take time to read the detail of any insurance contract before purchase, and this means looking past a summary of policy detail.

Established insurance providers like Santander should be able to help explain the scope of the cover provided by different products.  Furthermore, such reputable institutions should allow you adequate time to fully absorb what is often a significant chunk of information before pressurising you to sign up.  The existence of the ‘cool off’ period is not a substitute for allowing you time to digest the small print.  Steer well clear of any broker that tells you otherwise – if the product is any good, you’ll come back and purchase when you are ready.

Peace of mind is a valuable thing, but be aware that it is possible to over insure and effectively waste your hard earned cash in the pursuit of reassurance.  When weighing up an insurance policy of any kind, it is important to compare the cost of higher premiums from an all encompassing policy with option of taking a basic policy, then saving the difference and self insuring.  Many small insurance claims, for damage to your house or car, can prove costly when excess payments and the loss of a no claims bonus is factored into the equation.  This can mean that it makes most sense to exclude cover for many minor eventualities from your insurance policy, thus lowering the premium and freeing up funds for a savings plan.  In this way, you have more control over your money, and with a good run of fortune can develop a fund for some of the fun things in life, rather than automatically committing to higher regular premium payments.  Insure the significant essentials with a basic policy, and this can be a viable plan.