When it comes to cutting the cost of insurance, you need to be resourceful, willing to consider all options and dedicated to asking questions and then asking more questions. But being a savvy consumer will not only save you money in the year ahead but also save you money for many years to come.
Tips to Lower Insurance Costs and Save Money
Get Multiple Quotes
In general terms, you can potentially cut insurance costs by simply asking for quotes from two or three different agents or companies. Competition in the marketplace means that companies are in competition for your money. Use this competition to your advantage.
One way to cut your insurance cost is to learn if one company can meet two or more of your insurance needs. Buying a combination of plans might reduce your rates.
Consider what types of insurance might be available through a professional association or other organization. Perhaps your employer has a special plan with Triple A or are you becoming eligible for AARP?
Watch for Double Coverage
Don’t carry double coverage. You don’t need insurance on the rental car if it’s covered on your car policy.
Check for Discounts
Be sure to make use of discounts for low risk behavior or safe practices. Homeowner policies may offer discounts for homeowners who install various safety measures. Health coverage is may be less expensive for non-smokers and those who are not overweight. Be sure to check with your agent or policy for any discounts that may apply to you.
Do you Really need the Coverage?
Is it time to lower the amount of coverage you have? If you have little debt and adequate resources in place with no dependents then perhaps your life insurance policy can be reduced or eliminated.
Make Annual Payments in Full
If possible, make one annual payment if it reduces administrative costs. Check to see if online payments can help you to avoid processing fees.
Don’t Cut Coverage Too Much!
Cutting costs is certainly one of the primary ways to increase the available amount of money for savings and personal spending. Be sure to weigh the options, alternatives, and possible impacts of making reductions or changes in your insurance plans. Money spent on insurance is not simply money “out the window” but rather an investment which protects all your other investments. The old saying remains true: Don’t be penny wise and pound foolish.
Getting Cheap Insurance Online
One of the greatest pluses of the introduction of the Internet is that it has created competition in business that simply wasn’t there previously. It has also allowed business operators to operate their business in a forum where perhaps they may not have undertaken their business in the ‘real’ world.
Significantly, however, the Internet has reduced the operating costs of businesses. All of these elements, increased competition and reduced costs, has lead to one overwhelming benefit to the consumer – you and me – significantly reduced costs! And the world of insurance premiums is no different in this regard. So, if you are looking to reduce the cost of your existing insurance, or are looking to get cheap insurance, then going online could be the answer.
If you do decide to go online for your cheap insurance, or to reduce your existing insurance premiums, possibly the most important considerations you have are (i) is the insurance provider reputable; and (ii) is the policy what I need.
In the case of the former, obviously you want to takeout insurance with a reputable company, otherwise you may find that your insurance company doesn’t come through with the money when you need it. In the case of the later, unfortunately too many people who purchase insurance over the Internet fail to read the policy they are buying, in particular the ‘fine’ print, carefully and find out at a later date that they’re not covered for events they thought they were.
As such, it is imperative, when looking to buy insurance online, that you consider quality – not only price. Keep in mind that if you do not consider the quality of the insurance policy you are buying then you could well end up in the position where you have a cheap insurance policy, but you have actually had to pay out more of your own money than would have been the case if you had gone for a slightly more expensive policy.
Having researched the different types of particular insurance policy you want, all you then need do is use the terms associated with that type of insurance policy in a search engine – such as Google or Yahoo – and you should find a number of results of insurance providers willing to provide you with that type of insurance. That done, it is then suggested that you start to look at the policies offered by companies names who you recognize before moving on to those companies you are less familiar with, finally finishing with companies who you have never heard of before.
Normally this will help you to make sure that you select a reputable insurance provider. Having said this, just because you have never heard of an insurance company doesn’t mean that it is not reputable – so if you find that you like a policy offered by just such an insurance provider, all you then need to do is do a search on this company. To help you here, most search engines these days also have a “news” search function that should help you to find out if the company is getting good or bad press.
Finally, always remember that as with everything else, the Internet should really be used in conjunction with any research into insurance policies you are doing in the ‘real’ world, rather than instead of. And, hopefully, using the Internet with your normal research tools will help you to make sure you get the cheapest available insurance on offer catering to all your insurance needs.
How Your Credit History Can Affect Your Insurance Premiums
Consider this: if you have a bad credit history you’ll be paying more for your insurance premiums than if you have a good credit history. Why? Because a bad credit history is evidence that you are reckless and have money worries; and if you have money worries then there is an increased risk you’ll make a claim on your insurance policy If you have a bad credit history you’ll be paying more for your insurance premiums than if you have a good credit history!
So, if you do happen to have a bad credit history, how can you get away from these higher insurance rates? And the answer is that there is only one way to do this, and that is to pay your insurance premium as a lump-sum amount each year, rather than electing to pay for your insurance premium as a periodic monthly payment. Why should this be the case? Well, again, if you elect to pay monthly then your insurance provider is going to consider you a bigger risk as they have a greater level of exposure than would be the case if you pay the entire premium up front. What this means is that the insurance provider will consider the first three-quarters of your policy term as extended risk factor if you pay monthly, rather than as one lump-sum premium; as , not only will they considered the risk of claiming on your insurance being higher , they’ll also take into be consideration that there is an extended risk that you’ll not make your next premium payment.
Aside from agreeing to pay for your insurance premium as a lump sum you really only have 2 other options: (1) fix your credit history; or (2) look for cheaper insurance with an alternative insurance provider.
Should you wish to look for cheaper insurance with an alternative insurance provider then the following are considered the standard ‘5’ considerations to take into account:
1. Make sure the insurance company has a web-site and if it does not then don’t use it!
2. Make sure the insurance company is rated by at least one financial rating agency – such as Moody’s. Again, if it is not, then don’t use it.
3. Make sure the insurance company is a member of some government list. To do this, checkout the government’s department of insurance website , and if your prospective insurance company is not listed, don’t use it!
4. Make sure that your chosen insurance company doesn’t share a similar name to that of a more famous insurance company. If it does, then it is likely that it is trading on its namesake’s name and you may well find that they’re not bona fide.
5. Research consumer articles about the insurance company. To do this simply, checkout the consumer advice columns on the Internet for good and bad feedback.
So, you should now know that your credit history will affect your premiums and you can reduce these premiums if you do happen to have a bad credit rating.