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You are here: Home / General Insurance / 5 Insurance Policies You Probably Do Not Need In Nigeria

5 Insurance Policies You Probably Do Not Need In Nigeria

November 15, 2021 by Get Insurance Today

Because we can’t predict the future, we want to be ready to cover our financial needs if, or when, something bad happens. Insurance companies understand this and provide insurance policies to protect us from unforeseen calamities. These could range from diseases to disabilities and everything in between.

5 Insurance Policies You Probably Do Not Need In Nigeria
5 Insurance Policies You Probably Do Not Need In Nigeria

While we always hope for luck to be on our side, potential catastrophes in our lives are not worth insuring. In this writeup, we’ll look at 5 policies you don’t need. 

What are the 5 insurance policies you do not need in Nigeria?

Some of the insurance policies you do not need include:

1. Rental Car Insurance

Most auto insurance policies provide extra cover for car rental costs. They make you believe it is useful, should your car get in an accident. The truth is, most people hardly rent a car. When they do rent one, the cost is relatively low and scarcely worth insuring.

Although rental car insurance is not expensive, chances are you won’t need it in your lifetime. Meaning you’d be spending more than benefitting from it.

2. Private Mortgage Insurance Policy

Private mortgage insurance (PMI) is A familiar cover to homeowners. It increases their monthly mortgage cost. What PMI does is to protect the lender against loss when lending. Borrowers pay for this insurance with no benefits along.

You require PMI if you purchase a home with a down payment of less than 20% of the home’s value. The down payment signifies you’re at risk of defaulting on the loan. If Put down a minimum of 20%, there will be no PMI. You can also decide to do 10% and take two loans out. One will be 80% of the price of selling the property. The other will be 10%. Do note; interests rates may prevent the homeowner from actually benefitting.

3. Automobile Collision Insurance Policy

Collision insurance is designed to cover the cost of repairs to your vehicle if you are involved in an accident. If you have a loan out on the car, the loan issuer is likely to require that you have collision insurance, but if your car is paid off, collision is optional.

Therefore, if you have enough money in the bank to cover the cost of a new car, collision insurance may be unnecessary. This is particularly true if you are driving an old car because cars depreciate so quickly that many vehicles are worth only a fraction of their purchase price by the time you pay back the loan. Read more on car insurance rates in Nigeria.

4. Disease Insurance Policy

Policies are available to cover cancer, heart disease, and other maladies. Instead of trying to identify every possible disease you may encounter, get a good medical coverage policy instead. This way, your medical bills will be part of the cover regardless of the problem you face.

5. Life Insurance Policies for Children

Life insurance is designed to provide a safety net for your heirs/dependents. Because children don’t have heirs and, statistically speaking, are likely to grow up safe and healthy, most parents should not purchase life insurance for their kids. Instead, use the money that you would have spent on life insurance to fund an education plan.

Read more on the history of insurance in Nigeria.

Conclusion

While a certain amount of insurance coverage is necessary, you need to choose carefully. In general, broad policies that offer coverage for a multitude of potential events are a better choice than limited-scope policies that focus on specific diseases or potential incidents. Before you buy any policy, read it carefully to make sure you understand the terms, coverage, and costs. Don’t sign until you are comfortable with the coverage and are sure you need it.

Do you need a loan? Be sure to visit this loan platform that allows you to compare loans from different lenders in minutes. It offers the best and ensures that you get nothing less.

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Filed Under: General Insurance

About Get Insurance Today

Get Insurance is a digital asset that provides information of a general nature on insurance so that you are well informed about the kinds of insurance coverage that is available and what to consider in choosing an insurance cover that will be suitable, affordable and efficient in mitigating loss, damage or another unforeseen event. We are a company incorporated and operating from the British Virgin Island and our focus is on providing insurance information for African countries.

The information provided on this website is to help you know what to expect or questions/options to consider when seeking an insurance cover that will be the right fit for you, your family and business.

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