For most of us, insurance is like a dental checkup: It's a pain, but necessary to have. In fact, nearly 90 percent of Americans polled in our recent national survey called insurance either "essential," or a "necessary evil." Less than 10 percent considered insurance a waste of money.
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In a Bankrate survey commissioned by GfK Roper, Americans shared their attitudes toward insurance. The findings reveal that consumers need to prioritize their insurance needs and not waste money on frivolous types of insurance.
Happily, few see insurance as merely a money drain. "Although only about 8 percent consider insurance a waste of money, a real exception is the age category 25 to 34. This is probably drivers who were claim-free for ages 18 to 24 and resent the high premium they paid during those ages," says Edward E. Graves, MA, CLU, ChFC, an associate professor of insurance at the American College.
The youngsters' disregard for insurance surprised Greg McBride, a senior financial analyst at Bankrate. "Young people and young families have the greatest financial risk of inadequate coverage," he says.
If you had to choose ...
Asked which type of insurance they would drop first if money became tight, a near-equal amount of respondents said they would do without disability (44 percent) or life insurance (41 percent), but only 8 percent would dump health insurance first.
"It's encouraging to see that most of the respondents understand the value of health insurance," says Kirk Okumura, author and editor of the Life Underwriter Training Council Program at the American College, for which he writes study material and textbooks for insurance courses. "In terms of life versus disability insurance, it really depends on the person's situation. For those with no dependents, disability is clearly more important than life insurance. But for those with dependents, it is not as clear cut; if one had to choose between disability and life insurance, it would be a difficult decision."