My philosophy toward most types of insurance is that it’s better to be safe than sorry. This is especially true of health insurance. But insurance agents are just like any other type of salesmen — they’ll likely try to sell you something you don’t particularly need. And when you purchase items that you likely won’t ever use, well, then, you’re putting some small holes in your financial ship. And guess what sinks big ships? As the saying goes — small holes.

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Here are a few home-related insurance policies you shouldn’t get duped into buying.

1. Private mortgage insurance

Private mortgage insurance, also known as PMI, is a type of insurance that you purchase when you cannot pay the twenty percent down payment on your home. The purpose of private mortgage insurance is to protect the lender from the possibility of the “high-risk” borrower defaulting on their loan. Since you’re considered to be a high-risk borrower, the only thing that private mortgage insurance will do for you is to increase your monthly mortgage payments, and you reap absolutely no benefit. In other words, avoid PMI by waiting until you can pay a minimum of twenty percent on the value of your home.

2. Mortgage life insurance

Mortgage life insurance is a very niche insurance policy that doesn’t have much use on its own. The purpose of purchasing mortgage life insurance is that the policy would help your relatives pay off the value of your home in the event that you were to pass away. The problem with mortgage life insurance is that it becomes just another policy and bill that you have to pay. If you go for a quality term-life insurance policy, the policy should be enough to enable your heirs to pay ALL your bills off, including your mortgage.

3. Flood insurance

Of course, the value of flood insurance is really very dependent on the area in which you live. If you live on the actual coast of any of the Gulf States, then it’s probably a good idea to get flood insurance. If, however, your area hasn’t experienced flooding in the past several decades, it’s very doubtful that flood insurance will ever be of any use to you. Still, many insurance agents will try to sell you flood insurance. Do your research, and if you don’t live in a risk-prone area, then say, “Thanks, but no thanks.”

The above mentioned insurance policies are really only the tip of the iceberg when it comes to insurance policies that are, at the end of the day, completely superfluous. Whenever an insurance agent or anyone else, for that matter, tries to convince you to buy a certain insurance policy, ask for the details and the fine print. Ask questions. Then you’ll get a better idea of whether you actually need it or not. Good luck!

Tracy Myers, a former insurance agent, is now a full-time freelance writer and blogger. She’s blended her know-how of insurance with her passion for writing on her blog, which can found at

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