Don’t Be Fooled Into These Life Insurance Policies

by Hank Coleman

Here are five of my favorite life insurance policies you do not need that I love to hate. You don’t need these five life insurance policies. Don’t waste your money on these life insurance policies you do not need. Instead, look for a regular life insurance policy.

Five Insurance Policies You Do Not Need

Cancer Insurance

Life insurance policies you do not needYou should have proper term life insurance that covers ten years of your annual income. Having regular life insurance negates the need to have these specialty life insurance policies, and a term life insurance policy is cheaper than these additional coverages.

Insurance companies prey on our fears, and there is nothing scarier these days than getting cancer. But, if you have the proper amount of life insurance, then you do not need specific cancer insurance. It is a life insurance policies you do not need.

Accidental Death Insurance

Dying is dying. It doesn’t matter if it was an accident. You should not need additional insurance that pays out extra if you happen to die in an accident. A regular life insurance policy will pay out whether it was an accident or not. Do not waste your money on these additional insurance policies.

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Flight Insurance

This is another insurance policy that is exactly like accidental death insurance. Did you know that you can actually buy flight insurance in some airports from a vending machine overseas?

If you were to extrapolate the amount of insurance premium for the small amount of coverage time that is covered, flight insurance would be one of the most expensive insurance policies that you ever bought.

Pet Insurance

For most people, it would simply be cheaper to save for your pet’s medical needs. There are very few pet owners who need pet insurance. While it may make you feel better, it will end up costing you more money in premiums than you will ever collect by filing a claim. Insurance is designed to help you recover or prevent a catastrophic loss. Minor financial losses should be covered temporarily from your fully funded emergency fund.

Identity Theft Insurance

Identity theft is a hot topic right now, but that does not mean that you should run right out and purchase an insurance policy to cover you. While the Federal Trade Commission lists even a stolen credit card number as identity theft, it is a little more comforting to realize that completely stealing a person’s identity is extremely rare.

The problem with identity theft insurance is that it is very specific on what it covers, and it only covers a few things such as legal fees and time lost cleaning up your credit report. It also only kicks in after any homeowner’s or renter’s insurance pays out. Also, you may be footing the bill first and getting reimbursed only after you prove that you have been a victim.

If you are still worried, you can do what I did and freeze your credit report with the three credit bureaus and sign up for credit report monitoring through a company like LifeLockSign up for LifeLock Identity Protection today and get 10% OFF!

There is a danger to having too much insurance coverage. Insurance companies have professional, college educated actuaries whose sole job is to calculate the odds of the insurance company having to pay out an insurance claim. The insurance companies use huge historical databases to determine the likelihood of certain events based on a host of other factors.

You can be sure that they have run the numbers and know for a fact that the expected value cost of paying out these claims is far less than what they take in on premiums. A vast majority of these insurances expire unneeded.

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About Hank Coleman

Hank Coleman is the founder of Money Q&A, an Iraq combat veteran, a Dr. Pepper addict, and a self-proclaimed investing junkie. He has written extensively for many nationally known financial websites and publications. Hank holds a Master’s Degree in Finance and a graduate certificate in personal financial planning. Email him directly at Hank[at]

Hank Coleman has written 593 articles on Money Q&A. Learn more about Money Q&A on Twitter @MoneyQandA and @HankColeman.

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{ 2 comments… read them below or add one }

TB at BlueCollarWorkman

I was JUST talking with a buddy of mine about what B.S. pet insurance was! You’re right, save a little dough on the side, and that should be more than enough for all of Fido’s needs.



The reason I have had cancer insurance for years is the fact that it will pay me if diagnosed, treatments or not. I feel protected knowing if something were to happen, and I could not work, I would have a little income. Am I wrong???


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