I am a cheapskate. I like to buy things on the cheap. However, this can be a dangerous practice if you do not know what you are doing, especially when it comes to insurance.
The risk of buying the cheapest insurance comes when you try to make claims but cannot because of certain clauses in the contract which the agent conveniently miss out to warn you. The cheaper the contract, the more exclusion clauses it includes and the more stringent are the conditions in which you can make claims. You do not want to buy an umbrella that cannot open when it starts to rain. In matters of life and death for your wallet, the consequences will be disastrous.
I have a general rule when it comes to buying things of vital importance to me. If you are not familiar with the merchandise but still insist on buying it because it is important to you, don't buy cheap. On the other hand, if you are familiar with the merchandise and able to gauge its quality on examination, go ahead to buy on the cheap.