When offered insurance as part of another purchase transaction, be cautious and take your time. These policies are often very high priced, since the salesman may be getting a large commission or other inducement to sell it.

The lines of insurance most likely to have this problem are credit insurance, title insurance, travel insurance and insurance your bank buys for you if you do not keep your own insurance covering a loan in force.

Do not succumb to pressure to buy insurance right away. Ask for information to take home with you, including a copy of the policy describing what’s covered and the price they want for it. (Make sure to shop for title insurance before you go to the closing since it is difficult to stop a closing once you are in the middle of it.)

There are sometimes insurance companies that sell these products at more reasonable prices. For instance, in title insurance, there are insurers selling significantly below what most of the market is charging, but you have to find them since you are not likely to hear about such low-priced options from the salesperson you are dealing with (who may want to steer a person like you into a much higher-priced insurer in order to get a bigger kickback).

Furthermore, in many of these coverages purchase is optional, so you do not have to buy it to get the loan, product or service. In lines like credit insurance, travel insurance and insurance bought at the car rental counter, such coverages are not required. Also, make sure you don’t already have other insurance that covers the risk.

Remember: Pay careful attention in the following circumstances, where prices are often significantly higher than what you would pay if you could buy it yourself:

• You are buying a home and, at the closing, someone presents you with a title insurance policy that you did not shop for. You should shop for title insurance before you go to closing!
• You are making a large purchase such as a car or furniture and are offered credit insurance to cover the loan if you die or are disabled. You do not have to take this insurance to get the loan. Your own life and disability insurance probably is sufficient for your needs and is much less expensive for the amount of coverage you want for your transaction.
• You have let the insurance required for a home or car loan expire and your lender places a new policy for you. It is vital that you purchase your own policy as soon as possible because lender-placed insurance usually costs you much more than buying your own coverage.
• You are making any purchase and suddenly are confronted with an insurance offer. This could include such transactions as travel insurance from a travel agent, eyeglass or contact lens insurance from your eye doctor, collision damage wavers from a car rental dealer, or pet insurance from your vet. Be very careful of such offers, which are typically very expensive, and know that you usually do not have to purchase the insurance in order to get a product or a service. The reason these policies are very costly is that the person (or organization) selling you the insurance at the travel agency or car dealership is likely getting a large commission or other remuneration for the sale.