Here is how 15 minutes could truly save you 15% on your insurance.
Your insurance premium is definitely one of your monthly bills – you pay insurance on your auto and home owners’ insurance. Paying those insurance premiums can be expensive and inconvenient sometimes, especially when you are still struggling in your finances. However, insurance your prized possession is a wise thing to do because it protects you and your properties from the risk of loss. Insurance provides peace of mind to you and transfer risks on your properties to third parties. Having adequate insurance is not only smart, it is also a prudent to make sure that you are not over paying for your insurances so that you can save more money.
In a situation whereby you have multiple options, selecting the right insurer can be a daunting task. Also, there are wide differences in the premiums across insurance providers. That’s a good news for you, because you are in a position to choose the appropriate company that you want to transact business with.
Here are some ideas that you can use to cut down your insurance premium:
1. Shop around:Before you sign up for your next insurance quote, you should shop around. Make sure you get at least three quotes from different companies and compare them apples to apples before selecting a company to use. Please note, cheapest is not always the best option for you when it comes to shopping for an insurance company. Make sure you select a company that is reputable.
Car insurance premium rates vary by hundreds of dollars a year among insurance companies for the same levels of coverage. You should review your premium every year and check with other providers at least once a year to make sure you are getting the best deal on your insurance premium.
There are various discount packages from these companies, for example
Allstate offers some discounts based on the type of vehicle you drive, how often you drive and if you are a safe driver, and these discounts can save you from 5% to as much as 30% on your premium.
Geico offers discounts based on association you may belong to, for example, if you work for the federal government, Geico may offer you a discount of up to 8%.
State Farm offers discounts for students, vehicle-safety equipment and safe driving discount for drivers who log relatively few miles.
If you don’t shop around and ask questions, you will not be able to know the discounts that you may qualify for. Shopping around will ultimately help you to lower your insurance premium.
2. Raise your deductible: You should consider raising your deductible to save money on your insurance premium. Your deductible is the amount that you will have to pay by yourself in case you get in an accident. For example, if you get involve in a collision, and you have a deductible of $500, it means if the repair cost is $500 or less, the insurance company will not cover the repairs. If you raise your deductible to $1,000, your premium will drop, but in case you are involve in an accident, you will have to come up with the first $1,000 if the repair cost is over a $1,000. If the repair bill is $3,000, and you have a $1,000 deductible, the insurer will pay out $2,000.
According to research, if you raise your deductible from $500 to $1,000 saved about $150 a year, on average.
To choose this option, there are two considerations:
1. You must be a safe driver
2. You must have the amount of deductible in cash.
3. Reduce optional coverage: By reviewing your insurance coverage, you can determine whether or not you need some features. For example, there are optional features that you can decline that will help you to save more money by lowering your insurance premium.
As cars age, the need to insure against damage to the car diminishes, and by taking off those optional coverage you will end up saving more money.
4. Bundle your policies: If you have multiple items that you need to insure, by bundling all the items together, you could save more money. If you have more than one car or if you need to insure your boat, home, or any other property, you can save money by using one insurer rather than having all the properties insured through multiple providers. It’s also a way of simplifying your finances, because you will only have to pay from one account.
5. Maintain a good credit score: A good credit score will not only help you lower your borrowing cost whenever you need to borrow money, it can also help you save on your insurance premium. In most states, insurance carriers factor in your credit history in setting premiums. Studies have shown that there is a meaningful correlation between how we handle our finances and claims history.
According to Consumer Reports:
A single driver who had merely good scores paid $68 to $526 more per year, on average, than similar drivers with the best scores, depending on the state they called home.
Take a Driving Course
OK, this isn’t a fun one, but it could knock some money off your insurance rate.
Before you sign up, be sure to consult with your insurance provider to ensure a driving course will nab you a discount. (You don’t want to pay for a class — and sit all the way through it — for nothing.) Also ask if your insurance company provides class discounts; some do.