Which Insurance Could You Live Without?
I was doing a mini financial review today – I like to do them once in a while to make sure no one is taking money out of my account without my permission – and as I was going over the outgoings I noticed just how much money goes out of my account on insurance. When I think back on the amount of times I’ve had to make a claim, I could probably count them on one hand and that’s after a good 10 years of paying out for the stuff. This got me to thinking which insurances we actually need and which we could cut down on or do without.
I’ve only ever claimed once on home insurance but it was a pretty big claim. I accidentally flooded our first house which we had only recently bought and caused thousands of pounds worth of damage. Fortunately I had accidental damage cover because if I hadn’t then I’d have really been snookered. Even with accidental damage cover they weren’t too keen on paying out. If you’re renting then it can be good to remember that you only need contents insurance as the landlord should have the buildings aspect covered.
As much as it bugs me to see this go out every month, with two kids and a wife I love to bits there’s not a chance I would be caught without life insurance. In fact this is the only area where I’d edge toward being over insured just to know that my family would be comfortable if the worst were to happen.
Critical Illness Cover
I know this is an add-on to life insurance but after seeing a family member suffer recently with a critical illness, again I think it’s worth paying out for.
Being self-employed, loan insurance – or PPI – has always been a bit pointless for me as they don’t usually pay out if you’re self-employed. I’m not even sure whether I’d bother with it if I was employed as the costs are often quite high in comparison to the risk. It is possible to shop around and find independent loan insurance so perhaps that would make it more affordable. The only thing that would make me consider loan insurance is that my mother fell ill not all that long ago and she was extremely glad that she had insurance in place on her mortgage as it paid her monthly mortgage payment while she was ill, so it can be useful at times.
I’ve often wondered whether I could live without a car. It would take a big chunk off of my monthly outgoings when you take finance costs (I know, sorry), fuel and insurance costs into account. If I desperately needed a car to take me somewhere then would it work out cheaper to get the occasional taxi? Also if I wanted to take one on holiday then I could always hire one or if I kept hold of my vehicle and stored it then maybe I could get one day or one week car insurance from I4AD for the occasions when I really needed it.
Appliance insurance has been the subject of much debate in recent years and many people don’t think that extended warranties are worth the money. I currently have appliance insurance for my washing machine but only because we had to make a call-out when we first got the machine to fix what turned out to be an error in our own pipework rather then the machine itself. As a result the manufacturer was going to charge us for the call-out but offered us the insurance option instead which wasn’t that much more expensive than the call-out charge. As it works out we have actually had to use it a couple of times, so overall I think it has paid for itself considering what the cost of the call out charges and parts would have been for the times we have used it. It does seem that the devil is in the detail with appliance insurance, extended and existing warranties so it’s worth doing a bit of homework to decide if it’s worth it to you.
Whether it’s for all of your gadgets or you just want to insure your phone, gadget insurance is another one that can be picked up at quite a reasonable price and considering the cost of replacing things these days it could well be worth it. I currently have my phones insured but I don’t have my other gadgets insured, something I almost lived to rue when I spilt coffee on my laptop a couple of weeks ago!
We really could go on and on naming every type of insurance available but we’d be here all day. One thing this does show is just how much we spend on insurance and if you don’t think you can cut any of them out, how important it is to shop around and find the best deal available each time you renew. You could easily save hundreds of pounds each year just by comparing prices.
Is there any insurance which you think you could live without or are you the type of person that likes to insure everything?