Calculate realistic coverage needs based on Replacement cost (not market value) Income replacement needs Medical inflation. Exclusions are often buried in fine print and frequently ignored. But they matter a lot. Common exclusions include Natural disasters in property insurance Pre-existing conditions in health insurance Certain risky activities in life or travel insurance. Are Health Care Insurance Premiums Tax Deductible in the United States. A home insured for less than its rebuild cost. A life policy that doesn’t cover family expenses. Health insurance with insufficient limits for major procedures. In such cases, the policyholder bears a significant financial burden during a claim. Better approach: