If you’re not reading your entire insurance policy, you’re not alone- but it’s not a trend you should be celebrating. Reading all the fine print of your policy can inform you about what to expect and it can also open your eyes to possible gaps in your risk coverage. Even just reviewing your policies once per year can make a big difference in determining what has changed and where you need to focus going forward.
A recent research study revealed that up to one-third of small business owners never read through their insurance policy. While 30 percent of women check out the policy in full, only 16 percent of men exert the effort to the same. It’s not just the fine print being ignored, either- only 47 percent of policyholders at the small business level even read the policy summary.
Unfortunately, it’s not just insurance specifics that are falling by the wayside. It turns out that rental car contracts, software terms and conditions, and bank account terms are all getting ignored, too. Some of the most common reasons cited for ignoring the specific verbiage had to do with confusion over what the terms actually meant and general disinterest in documents with any kind of legal purpose.
Even if you’re not reviewing everything inside the document, there are benefits to making yourself as informed as possible about what coverage you have. You do have a few resources in your arsenal to help make it easier to understand. Consider the following:
Contact your insurance agent for specifics if you don’t understand a specific term. Insurance agents are much more familiar with the basics of policies and can put the jargon into laymen’s terms so you actually know what you’re paying for.
Keep a list of legal terms that are not entirely clear. You can look them up online or put them together in an email to your insurance agent. Some of the most common questions have to do with riders, so once again this is a good opportunity to set up a quick conversation with your agent.
Finally, the process of understand coverage terms begins before you even have a policy in hand. Getting an insurance quote can be confusing, too. Work with your insurance agent to conduct a needs analysis and then ask for assistance in breaking down how this plays out in various forms of coverage. This will help narrow down your choices for selecting the best policy for your needs.