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  • Eric Walter, CFP®

Is Your Cheaper Premium Worth It?

Whether it’s health, auto, homeowners, or life, advertisements abound for cheaper insurance premiums. Cash flow cannot be ignored but there are other key factors to consider- are you properly insured, will they fight paying your claim, are you able to get in contact with them, will they have the ability to pay claims in the future, what is your out-of-pocket, to name a few.

One of the main ways companies decrease the premium is by decreasing the benefits. This would be great if you knew you would never need to use the policy, but if you knew that, you would only buy the amount of insurance required by law. Since the cash outlay for premiums is immediately felt, it can be appealing to go with a cheaper option and hope it’s never needed. The reality is, a time will come when we do need it.

I can personally attest to the benefit and peace of mind from having paid the higher premium. During the recent hail storm in our area, our roof was damaged. The adjuster came out the next business day (Friday) after I called. He inspected the roof and said they would have an estimate on Monday. By 9:00 a.m., I received a payment letter. I had an independent appraiser review their findings. He said it was in line with what he would expect in my situation.

I experienced no dispute, no attempt by my company to pay less than full replacement cost, and had no issues reaching them. By Wednesday, I had the check. In the moment of need, you want to be properly covered AND have no hassles receiving that coverage.

Independently or as part of your Financial Plan, we can review and make recommendations to ensure you have the right coverages. Let us know if you would like to schedule a time to discuss this or any other planning items.

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