Unless you’re a risk-taker, there’s not much choice when it comes to deciding whether or not to insure some of your costliest possessions—your car, your home and your life. However, you do have options when choosing an insurance company, deciding what kind of policy to take out and deciding how much to insure. Taking a few minutes to consider all of your options could save you more than a few bucks on insurance.
How To Save On Auto Insurance
Check for discounts: There are a number of discounts available that you may be eligible for. Taking defensive driving courses, for example, could help you get a discount on your auto insurance rates. You could also get a discount if you’re a good driver, with a good driving record and no violations. Other discounts may be found through clubs and organizations of which you are a member. Some of these organizations may have worked out deals with various insurance companies to provide discounts to their members. There are even discounts available for good students. What companies consider to be “good students” varies, but they are generally determined by a high GPA or making the “dean’s list.” The idea behind this discount is that good students are better drivers. Other discounts could be available for military drivers, retired drivers and infrequent drivers. If you think you might qualify for any of these discounts, check with your insurance company or with prospective insurance companies to see what they offer.
Drop some coverage: If you have a really old car, or a car in bad condition, try to determine how much it’s worth. If it’s worth ten times less than the amount you’d pay for coverage, you could consider dropping collision and comprehensive coverage altogether if it’s not worth it to you.
Drop the extras: If you’re looking for areas to cut back on in your insurance policy, consider dropping towing and car rental. The need for towing is something that you can easily lower the cost of your insurance. Keep in mind that in the event of an accident, towing is almost always covered under collision. Other situations where you may need to tow your car are avoidable, as long as you keep up with your car maintenance and try not to lock your keys in your car or make sure you have a spare set in safe place in case that happens. Also, make sure you have a spare tire and know how to change it. Sometimes your car will break down, but if it’s well-maintained, it won’t happen often. Set aside money for an emergency fund in the case you need to pay for unavoidable towing costs in the future. That way, you won’t be blindsided by the costs. Car rental is another example of coverage that you might not need. This offers zero deductibles and downtime coverage—coverage for any costs a car rental company charges you for money lost if you wreck a car and they can’t rent it out because it’s being repaired. While this coverage may be useful to some drivers—those who rent often or don’t mind spending extra—it’s probably a good place to look if you’re trying to drop coverage you don’t think you need.
How To Save On Homeowner’s Insurance
Improve your home security: Your insurance company may offer discounts for improved home security. This can include having a smoke detector, burglar alarm or dead-bolt locks. If you install a sophisticated sprinkler system and a fire and burglar alarm that calls the police, fire or other monitoring stations, you may be able to get an even larger discount on your premium. However, before you go out and buy home improvement systems, check with your insurance company first to see what they offer and how much you could save.
Prepare your home for disasters: You might be able to save on premiums by making your home more resistant to natural disasters. This could include adding storm shutters, buying stronger roofing materials or reinforcing your roof and windows. You can retrofit a home to make it better able to withstand earthquakes. You could also modernize your heating, plumbing and electrical systems to reduce the risk of fire and water damage. Check with your insurance company to find out what sort of steps you can take to fortify your home and receive discounts.
Downsize: The larger the house, the larger the coverage and the higher the insurance costs. While saving on your homeowner’s insurance alone is not a good reason to sell your house, it’s an added benefit to consider. Maybe your house seems too big for you now, or your kids have all moved out. Whatever the reason, if you move to a smaller home, you will have less to insure and less to pay.
How To Save On Life Insurance
Take care of yourself: Your life insurance will depend on your age, your health and your habits. If you smoke or enjoy skydiving, your policy is likely to be higher. Most insurance companies have several tiers of rates, including a lower tier for non-tobacco users and a higher tier for tobacco users. So quit smoking, cut back on alcohol consumption, exercise and stay healthy. Doing so could help you qualify for lower life insurance rates.
Update your policy: It’s a good idea to update your policy every couple of years or after major life events. Your situation now could be different from when you first took out your policy. You could be older or have more dependents, and these things may change what you need to have covered in your policy. Make sure you update your policy if you get married, get divorced, purchase a home or have children.
How To Save On Any Type Of Insurance
Shop Around: Whether it’s the first time you’re buying insurance or you already have a policy, you should shop around. Get at least three different quotes—even more if you’re up for it—and choose the company that offers you the best rates. Even if you have been with an insurance company for years, it never hurts to look around and make sure you’re getting the best deal. Getting quotes from other companies could even help you negotiate a better deal with your current company.
Increase your deductible: If you’re willing to pay more out of pocket when a disaster actually strikes, then you could increase your deductible, which will decrease your premium. Increasing a deductible from $250 to $500 could save as much as 15 percent on monthly premiums. Each company is different, however, and you should do the math before you increase your deductible to make sure it would be worth it for you. Don’t increase your deductible if you don’t think you can afford the higher price if you need to pay it in the event of an accident, natural disaster or other emergency.
Bundle up: Get all of your insurance from one provider. Insurance companies will often offer a discount if you have multiple policies with them. This also makes paying more convenient for you.
Pay annually: If you can afford it, pay your premiums annually. Most insurance companies offer the option to pay annually, semi-annually, quarterly or monthly. Making one payment will often cost less than making multiple payments. Check what your provider charges monthly and calculate how much more it costs. If it’s worth the savings, pay once instead.
Knowledge Is The Best Policy
To get the most out of your insurance, know what you need and know what you’re paying for. Read your policies and makes sure you know what’s included in your coverage. Ask agents at your insurance company your questions. And of course, always stay on top of things. Shop around every once in awhile to make sure you get the best rates and continue to update your policies as your life changes.