Coverage We Refuse to Sell (Even Though It Costs Us Money)
Last Updated: January 2026
Reading Time: 7 minutes
Author: Todd Conn, TCDS Insurance Agency
We turn down business regularly.
Not because we don't want your money. Not because we're picky about who we work with. But because selling you inadequate insurance is worse than not selling you insurance at all.
This article explains exactly what coverage we refuse to sell, why we refuse to sell it, and what we recommend instead—even when it means losing a sale.
1. State Minimum Auto Liability (25/50/25)
What It Is
Alabama's minimum required auto liability coverage:
- $25,000 per person for bodily injury
- $50,000 per accident for bodily injury
- $25,000 per accident for property damage
Why People Want It
It's cheap. Often $300-$500/6 months.
Why We Won't Sell It
One serious accident will financially destroy you.
Real scenario:
- You cause an accident
- Other driver has $60,000 in medical bills
- Your insurance pays the maximum: $25,000
- You're personally liable for $35,000
- They sue you
- They garnish your wages
- They put a lien on your house
State minimums were set in 1975. Medical costs have increased 600% since then. $25,000 doesn't cover a broken leg anymore.
What We Recommend Instead
Minimum: 100/300/100
- $100,000 per person for bodily injury
- $300,000 per accident for bodily injury
- $100,000 per accident for property damage
Cost difference: $150-$250/6 months more than state minimums
Protection difference: You're not personally liable unless damages exceed $300,000 (rare)
Our rule: If you can't afford 100/300/100, you can't afford to drive. The risk is too high.
2. Actual Cash Value (ACV) Home Insurance
What It Is
Home insurance that pays depreciated value for claims, not replacement cost.
Example:
- Your 15-year-old roof is damaged in a tornado
- Replacement cost: $12,000
- Actual cash value (50% depreciation): $6,000
- You pay $6,000 out of pocket to replace the roof
Why People Want It
It's 20-30% cheaper than replacement cost coverage.
Why We Won't Sell It
You'll be underinsured when you need insurance most.
Real scenario:
- Tornado destroys your home
- Replacement cost: $300,000
- ACV coverage pays: $180,000 (40% depreciation for older home)
- You're $120,000 short of rebuilding
- You either don't rebuild or go into massive debt
Insurance is supposed to make you whole after a loss. ACV coverage doesn't do that.
What We Recommend Instead
Replacement cost coverage
- Pays to rebuild your home at today's prices
- No depreciation deduction
- Costs 20-30% more, but actually protects you
Our rule: If you can't afford replacement cost coverage, you need to increase your deductible or reduce other coverage—but we won't sell you ACV.
3. Auto Insurance Without Uninsured Motorist Coverage
What It Is
Uninsured motorist (UM) coverage pays your medical bills and damages when you're hit by a driver with no insurance.
Why People Want to Skip It
Saves $10-15/month. They assume everyone has insurance.
Why We Won't Sell It
13-15% of Alabama drivers have no insurance. That's 1 in 7 drivers.
Real scenario:
- Uninsured driver runs a red light and T-bones you
- You have $40,000 in medical bills
- They have no insurance
- They have no assets
- Without UM coverage, you pay your own $40,000 in medical bills
- With UM coverage, your insurance pays it
UM coverage costs $10-15/month. One accident without it can cost you $50,000+.
What We Recommend Instead
Uninsured motorist coverage matching your liability limits
- If you have 100/300/100 liability, get 100/300/100 UM
- Costs $120-$180/year
- Protects you from uninsured and underinsured drivers
Our rule: UM coverage is not optional in Alabama. The uninsured driver rate is too high.
4. Home Insurance Without Flood Coverage (in Flood-Prone Areas)
What It Is
Standard homeowners insurance does NOT cover flooding. You need separate flood insurance.
Why People Want to Skip It
- "I'm not in a flood zone"
- "I've lived here 20 years and never flooded"
- Costs $400-$3,000/year
Why We Won't Sell It (in Flood-Prone Areas)
30% of flood insurance claims come from low/moderate risk areas.
Real scenario:
- Heavy rain causes flash flooding
- Your home has $80,000 in flood damage
- Your homeowners insurance doesn't cover it
- You have no flood insurance
- You pay $80,000 out of pocket or don't repair it
"I'm not in a flood zone" is not the same as "I can't flood."
What We Recommend Instead
Flood insurance through NFIP or private carriers
- High-risk flood zones: $1,200-$3,000/year
- Moderate-risk zones: $400-$800/year
- Low-risk zones: $300-$500/year
Our rule: If you're near water (river, lake, creek, coast) or in a low-lying area, we won't write your homeowners policy without discussing flood insurance. If you're in a designated flood zone, we require it.
5. Underinsured Dwelling Coverage
What It Is
Insuring your home for less than its full replacement cost.
Example:
- Your home's market value: $250,000
- Your home's replacement cost: $350,000
- You insure for $250,000 to save money
Why People Want It
Lower dwelling coverage = lower premium (saves 20-30%)
Why We Won't Sell It
Coinsurance penalty destroys you in a partial loss.
Real scenario:
- You're insured for $250,000 (should be $350,000)
- You're 71% insured (250/350)
- Tornado damages your roof: $30,000 to replace
- Insurance pays 71% of the claim: $21,300
- You pay $8,700 out of pocket (plus your deductible)
Even worse: Total loss
- Fire destroys your home
- Replacement cost: $350,000
- Your coverage: $250,000
- You're $100,000 short of rebuilding
What We Recommend Instead
Insure for full replacement cost
- We calculate replacement cost based on square footage, construction type, and local building costs
- Not market value (often lower)
- Not tax assessment (often lower)
- Actual cost to rebuild from the ground up
Our rule: We won't insure your home for less than 100% of replacement cost. If you can't afford the premium, we'll increase your deductible—but we won't underinsure your dwelling.
6. Business Insurance Without Professional Liability (for Service Businesses)
What It Is
Professional liability (errors & omissions) covers claims that you made a mistake, gave bad advice, or failed to deliver promised services.
Why People Want to Skip It
- "I haven't had any problems"
- "My clients trust me"
- Saves $800-$2,000/year
Why We Won't Sell It (for Service Businesses)
One lawsuit will cost you more than 20 years of premiums.
Real scenario (IT consultant):
- You recommend a software solution
- It fails and causes client's business to lose $100,000
- They sue you for professional negligence
- Without E&O insurance, you pay legal defense ($50,000+) and settlement ($100,000)
- With E&O insurance, your insurance pays it
Service businesses (consultants, accountants, IT, architects, engineers) NEED professional liability.
What We Recommend Instead
Professional liability coverage
- $1M coverage: $800-$2,000/year depending on industry
- Covers legal defense and settlements
- Protects your business and personal assets
Our rule: If you provide advice or services (not physical products), we require professional liability coverage.
7. No Umbrella Policy (for High Net Worth Clients)
What It Is
Umbrella insurance adds $1M-$5M of liability coverage on top of your auto and home insurance.
Why People Want to Skip It
- "I have good liability limits already"
- "I'm a safe driver"
- Don't want to spend $300-$800/year
Why We Won't Sell It (for High Net Worth Clients)
If you have assets to protect, you need umbrella coverage.
Real scenario:
- You cause a serious accident
- Other driver has $500,000 in medical bills
- Your auto liability: $300,000
- You're personally liable for $200,000
- They sue you
- They go after your savings, investments, home equity
Umbrella coverage is cheap protection for high-value assets:
- $1M umbrella: $300-$400/year
- $2M umbrella: $400-$500/year
- $5M umbrella: $600-$800/year
What We Recommend Instead
Umbrella policy if you have:
- Net worth over $500,000
- Home equity over $250,000
- Significant retirement savings
- High income (garnishment risk)
Our rule: If you have assets worth protecting, we strongly recommend umbrella coverage. If you refuse, we document it in writing.
Why We Turn Down Business
It's Not About Being Difficult
We're not trying to be difficult or force you to buy coverage you don't need. We're trying to prevent financial disasters.
We've seen what happens when people buy inadequate coverage:
- Bankruptcies from uninsured motorist accidents
- Families unable to rebuild after total loss fires
- Businesses shut down by lawsuits
- Retirees losing their savings to liability judgments
Selling you inadequate coverage is unethical. We won't do it, even if it costs us a sale.
Our Job Is to Protect You, Not Just Sell You
Our job is to:
- Identify your risks
- Recommend adequate coverage
- Explain why you need it
- Refuse to sell you inadequate coverage
Our job is NOT to:
- Sell you the cheapest policy
- Agree with whatever you want
- Let you underinsure yourself to save money
If you want the cheapest possible coverage with no advice, online insurance companies will sell it to you. We won't.
What Happens If You Insist
If you insist on buying coverage we consider inadequate, here's what happens:
Option 1: We Explain the Risk
We'll explain exactly why the coverage is inadequate and what could happen. Often, once people understand the risk, they agree to better coverage.
Option 2: We Offer Alternatives
If you can't afford the coverage we recommend, we'll find alternatives:
- Increase your deductible to lower premium
- Remove optional coverages (but keep essential coverage)
- Find a more affordable carrier
Option 3: We Document Your Decision
If you still insist on inadequate coverage, we'll document it in writing:
- We recommended [specific coverage]
- You declined it
- We explained the risks
- You accepted the risks
This protects both of us.
Option 4: We Decline to Quote
In extreme cases (state minimum liability, ACV home coverage, no UM coverage), we'll decline to quote you at all. We'd rather lose the sale than sell you coverage that will fail you when you need it most.
Coverage We DO Sell (That You Might Not Need)
We're not trying to upsell you on everything. Here's coverage we offer but don't require:
Optional Coverages You Might Not Need
- Rental car coverage (if you have another vehicle)
- Roadside assistance (if you have AAA)
- Identity theft coverage (if you have credit monitoring)
- Equipment breakdown (if your home is new with warranties)
We'll explain what each coverage does and let you decide. We only require coverage that protects you from financial catastrophe.
The Bottom Line
We refuse to sell coverage that will fail you when you need it most.
This means we turn down business. It means some people think we're too expensive or too demanding. But it also means our clients are actually protected—not just paying for a false sense of security.
If you want the cheapest possible coverage with no questions asked, we're not the right agency for you.
If you want honest advice, adequate coverage, and an agent who will fight for you in claims, we're the right fit.
Our Recommendation
Get a quote from us and compare it to online insurance or other agencies.
We'll explain exactly what coverage you need and why. We'll show you where you can save money without sacrificing protection. And we'll refuse to sell you coverage we know is inadequate.
If you value honesty over low prices, we're the right agency for you.
Get Your Quote → [blocked]
About TCDS Insurance Agency: We're an independent insurance agency serving Birmingham, Pelham, and Cullman, Alabama. We represent 10+ carriers and have the freedom to tell you the truth—even when it costs us a sale. That honesty is why our clients trust us and refer their friends and family.