When it comes to insurance, it’s easy to fall into the trap of "set it and forget it." But making the wrong choices—or none at all—can leave you vulnerable when you least expect it. Whether you’re covering your car, home, business, or family, this guide will walk you through five of the most common insurance mistakes people make—and how to steer clear of them.

1. Underinsuring Just to Save a Few Bucks

Penny Wise, Policy Foolish

It might be tempting to shave a few dollars off your monthly premium by choosing minimum coverage—but that could cost you big time down the road. Many policyholders find out the hard way that their coverage doesn't fully protect their assets in the event of an accident, fire, or lawsuit.

Example: If your home is underinsured and you face a total loss, your policy might not cover the full rebuild cost—leaving you with a major financial gap.

How to Avoid It:

Work with an independent agent (like Butts Insurance) to determine the right coverage limits based on your actual needs—not just the minimums. A slightly higher premium now could save you thousands later.

2. Forgetting to Update Your Policy After Major Life Changes

Life Moves Fast—Your Insurance Should Keep Up

Got married? Bought a new car? Started a business from home? These changes might impact your insurance needs—but many people forget to update their policies until it’s too late.

How to Avoid It:

Treat your insurance like a living document. Review it annually and after any major life event. At Butts Insurance, we offer personalized policy reviews to make sure your coverage grows with you.

3. Overlooking Discounts and Bundling Opportunities

Why Pay More for Less?

Did you know bundling your home and auto insurance with the same provider could save you up to 25%? Many customers miss out on valuable discounts simply because they don’t ask.

Other Missed Discounts:

Safe driver discounts
Home safety upgrades (alarms, sprinklers, etc.)
Loyalty discounts
Good student discounts

How to Avoid It:

Ask your agent to perform a full discount checkup. As an independent agency, Butts Insurance can compare rates across multiple carriers and find all the savings you’re eligible for.

4. Not Understanding What Your Policy Actually Covers

Assume Nothing, Read Everything

We get it—insurance lingo isn’t exactly bedtime reading. But assuming you’re covered for something when you’re not? That can be a costly mistake.

Common Misunderstandings:

Floods are not covered by standard homeowners insurance
Business activities might void your personal auto or home policy
“Replacement cost” and “actual cash value” are very different

How to Avoid It:

Sit down with an agent who explains things in plain English. At Butts Insurance, we break things down clearly so you know exactly what you’re paying for—and what you're protected against.

5. Relying on Online Quotes Without Talking to an Expert

Click, Quote, Regret

Online quotes are fast and convenient, but they’re not always accurate. They can miss key details, use outdated valuation tools, or skip important add-ons that you may need.

How to Avoid It:

Use online quotes as a starting point, not a finish line. A quick conversation with a local agent ensures you’re getting accurate, tailored coverage—not a cookie-cutter plan that leaves gaps.

Let’s Recap: Avoiding the Big 5

Insurance is one of those things you only appreciate when something goes wrong—so it’s worth getting right the first time. By avoiding these common mistakes, you protect your finances, your family, and your future.

Smart Insurance = Peace of Mind.

Ready to Review Your Policy the Right Way?

Don’t wait until it’s too late to fix your coverage. At Butts Insurance, we help you make confident, informed choices about your home, auto, life, or business insurance. Visit www.buttsinsurance.com today to schedule a free, no-pressure consultation with one of our friendly, experienced agents. We’ll help you avoid the headaches—and build a policy that fits just right.

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