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As a millennial, you’ve reached the age where you may be taking out student loans, buying or renting a place to live, having kids and, ultimately, you’re going to be purchasing insurance. These major life events for you make it imperative to have a financial security net. And that’s precisely what insurance is: a financial security net. So, it’s disconcerting that a survey from Princeton Survey Research Associates International named millennials the most underinsured generation.
There are numerous reasons why people of all generations sidestep purchasing insurance. It‘s often seen as a big investment, but that doesn’t mean that it’s a costly one. In fact, insurance probably costs less than you may think. For instance, according to the National Association of Insurance Commissioners (NAIC), millennials overestimated the cost of renters insurance by more than five times its actual cost per year.
Also, the complicated terms can make finding a policy a bewildering experience and the subject matter can be hard to understand. No one wants to think about being in a car accident, experiencing a break in, losing everything in an apartment fire or any other sort of bad, unforeseen event. But these things can and often do happen, so you’ll want to be ready.
And don’t let any initial misperception or preconceived notions drive you away. You’re a millennial, after all! Your generation is always undertaking new challenges and expanding the way society works, oftentimes in brilliant ways.
Insurance offers essential financial protection for your future, so now’s the time to start “adulting” and take that first step.
When looking for insurance, your top priority should be to find acceptable coverage. Price is important, but you’ll want to figure out what kind of coverage you need first. Then you can fit that coverage into your budget and decide which carrier can provide you with the most inclusive policy for your situation. You may be tempted to choose insurance with the lowest price tag, but if you don’t have enough coverage (or the right kind of coverage), you will see a less financial benefit when it comes time to file a claim.
Once you assess your coverage needs, factor in your budget and find ways to save. Ask your insurance agent if there are any discounts on your coverage. Often, carriers offer discounts for things like paying your policy in full, staying auto accident-free or, if you’re in school, getting good grades. You also can save money by “bundling” multiple policies, such as purchasing home and auto insurance from the same carrier.
A regular policy will cover the essentials, but you may need to add additional coverage to meet your unique needs. For example, you may have things like electronics or an expensive piece of jewelry that would be financially difficult to replace, even with the assistance of your average renters or homeowners policy. You may want to add additional coverage for these things.
Life insurance is essential, no matter how young or old you are. And for millennials, buying now is a very smart move because it’s cheaper to buy a life insurance policy when you’re young and healthy. This kind of insurance can help your family cover unexpected costs in your absence, including student loan debt or a mortgage, in addition to end-of-life costs. And if you have kids, a life insurance policy can also support their education or childcare expenses. Also, every millennial should consider long-term disability coverage, which helps you stay afloat financially if an accident happens and you become disabled and unable to work.
An independent insurance agent is a valuable resource when purchasing insurance—especially if this is your first time. An independent agent works with many different carriers, which is different from captive agents who can only sell insurance from the company they work for. An independent agent will make sure that you are getting the best coverage, for the best price. You’ll also benefit from independent agents’ insurance knowledge; they know how to talk you through your options and actually explain what’s in your policy. An independent agent will make sure all of your assets are covered, help you find discounts or other ways to save, and be a valuable resource as your life changes and your insurance needs change, too.