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Ellen Phillips

With my family's insurance renewals coming up, I've spent the past couple of months checking out home and auto coverage from different companies. Interestingly enough, my research points out some myths about insurance that many folks may not know. For example:

1. With all the recent rain and flash floods, I can't help but think of consumers who mistakenly believe that homeowners insurance covers all damage. Too many homeowners have taken a beating because they think they're protected from those teeming waters. Remember: the only insurance that covers floods is FLOOD insurance.

2. Just because you've paid your homeowner's policy in full doesn't automatically mean you're covered when something happens to your house. Exclusions, special conditions, and other limitations may impact what you'll get if you incur a loss. Check regularly with your agent to review your policy to ensure you've got the right one based upon your needs and wallet.

3. Just because one buys "full coverage" doesn't mean everything's covered. First of all, there's no such animal as "full coverage" and, in fact, most states mandate only liability insurance. Be certain you select only the coverage you need and can afford.

4. Thinking certain car colors increase premiums is another mistake people make. That cherry red vehicle won't make your payments rise, but some other factors will, including the year, make and model of the auto; miles driven per year; the driver's age, driving record and credit history; and other persons also named on the policy.

5. Just because policyholders own an older car doesn't mean we don't need comprehensive coverage. These days, many thieves target less new vehicles; they're easier to steal, plus a strong market exists for older parts.

6. A great life insurance plan at work doesn't mean you shouldn't purchase more. After all, if you leave your job, chances are you won't be able to take the coverage with you. It wouldn't hurt to talk to a licensed life insurance professional about buying your own policy, such as affordable term life, particularly if you still have children at home to be cared for and educated.

7. Health insurance doesn't necessarily cover all expenses. After all, even the best policies mean copays and deductibles. This is where a supplemental policy might come in handy, especially for cancer, accidental injury, and so forth. Following a bad accident last summer (and at the expense of three weeks in the hospital, three months of outpatient rehab, and lots of pain in recovery), I received a check for $8,500 that covered all extra medical expenses and then some. In fact, I had enough money left over in my pocket to buy an iPad for my husband and one for me!

(P.S. After my July 6 column, I received an email from the administrator of the website It lists brand new, free book offers, updated every few hours, for frugal readers of Kindle, Kobo and Nook.)

Ellen Phillips is a retired English teacher who has written two consumer books. Her Consumer Watch column appears every Saturday and she may be reached via email at