Common Insurance Myths: Important Truths to Learn in the Insurance Business

Insurance can be a tricky business to understand. Here at Ebensburg Insurance, we want to help you get to know your policies better, and be informed on exactly what you are paying for. There are many myths and misconceptions about common insurance plans. Today, we will take the time to debunk some of those myths and teach you what your policies actually cover. 

Myth 1: You Don’t Need Life Insurance if You’re Young and Healthy

Many people believe life insurance is only necessary for older adults or those with serious pre-existing health conditions. However, the reality is that life insurance is cheaper to buy when you’re young and healthy. You can secure low premiums the earlier you choose the right life insurance plan for you. 

This plan will provide financial protection to your loved ones in the case of an unexpected event. Life insurance gives you the peace of mind you need, knowing that no matter what happens, your family will not be faced with a financial burden if something happens to you. 

Myth 2: Only Rich People Need Umbrella Insurance

Some people believe that only rich people ever face lawsuits, or that only rich people deal with lawsuits that run their existing liability coverage dry. This is not the case. Lawsuits have been filed against all kinds of people for a multitude of reasons for decades. 

Umbrella Insurance works to increase your liability coverage to a limit of $1 million or greater and can be added to your home insurance as well as other policies you hold. If your home has high-risk elements, like a pool or a trampoline, it could be in your best interests to add umbrella insurance in case you are faced with a lawsuit. An independent insurance agent can advise if umbrella insurance is right for you. 

Myth 3: Homeowners Insurance Covers All Types of Damage

While homeowners insurance provides you with protection against the most common threats like fire and theft, it does not cover everything. For instance, most standard policies don’t cover flood damage or earthquake damage. If you live in an area with these types of weather-related risks, you may want to consider additional coverage to ensure you’re fully protected.

Myth 4: I Don’t Need Renters Insurance, I Don’t Have That Much Stuff

Before you buy into this myth, take the time to walk through your home and write down the estimated value of all of your belongings. How much would it cost if you had to replace them all out of pocket after a huge disaster like a fire? You might be surprised by the total. Anyway, most landlords and lease agreements require you to get some form of renters insurance.

Even if your belongings aren't particularly valuable or expensive, having the right renters insurance policy can help you get your life back on track after a disaster. A renters policy can help reimburse you for losses to your personal property as well as your liability exposures. An independent insurance agent can further explain the many benefits provided by renters insurance, regardless of how much property you own.

Myth 5: If Someone Else Drives My Car, Their Insurance Would Pay for the Damage

Unfortunately for the vehicle owner in these situations, in most states (including Pennsylvania), it's their insurance that would be responsible for covering the damage after an accident, no matter who was behind the wheel. Since the vehicle's owner is considered the primary insurance policy, it would be the one to cover the damage after an accident, regardless of whether it was you, a family member, or someone else driving the car. However, policies and laws vary by state and situation, so review these rules together with your independent insurance agent before allowing anyone else not listed on your policy to drive your car.

Myth 6: Insurance is Unaffordable

Contrary to popular belief, if you pick the right plan with the right agency, insurance can be shockingly affordable. The cost of a policy depends on various factors, including your age, health, and the type of coverage you choose. Term life insurance, for example, is often more budget-friendly than whole life insurance. Plus, the peace of mind it provides is well worth the investment. 

The Truth Behind Insurance: Stay Informed on Your Coverage

At Ebensburg Insurance, we believe that the right knowledge is just as important as the right coverage. Myths and misconceptions can leave you underprotected or paying for something you don’t fully understand, but the truth is that insurance is designed to safeguard your future and give you peace of mind. By working with one of our experienced agents, you can work through the confusion and feel confident that you and your loved ones are protected. Don’t let misinformation guide your decisions. Let us help you make informed choices that truly secure what matters most.