by: Jason R.
Most people pay more than they have to for insurance coverage। There are two ways to reduce your insurance costs. First, you or your agent should shop around for the best premium prices.
The insurance industry is very price-competitive these days, and people have told me nu merous times that by taking a little initiative, or prod ding their agents to take some initiative, they have been able to save hundreds of dollars on their annual insurance costs. Second, make sure you pay only for the policy features and options you need.
All too often, people purchase a “Rolls-Royce” policy when a “Ford” would suit them just fine.
The following suggestions will help you save some insurance money at a time when you could probably use the money for other worthwhile purposes.
One of the few good things to come out of bad economic times is that we are forced out of fear, if not financial necessity to become wiser consumers. I hope that you will carry these good habits, including being a wiser insurance consumer, forward when prosperity returns anew.
Health Insurance
If you are fortunate enough to have your health insurance provided or, more likely, subsidized by your employer, be sure you understand what it does and doesn’t provide.
• You may be offered a choice of plans, each of which offers different types of coverage. Thinking that they shouldn’t skimp on health insurance, many people automatically select the policy that costs the most. Instead, you should select the policy that provides the kind of coverage that you and your family need and it may not be the most expensive policy.
• If you have to buy health insurance on your own, it is almost always cheaper to do so as a member of a group rather than as an individual.
You may be able to obtain this coverage through a professional organization or some other local group, such as the Chamber of Commerce, that offers group health insurance to its members. Your state may also be able to steer you to lower-cost coverage.
Homeowner’s/Renter’s Insurance
There are a few ways that you can reduce your homeowner’s or renter’s insur ance premium without affecting the coverage that you need.
• Obtain quotes from a number of insurance compa nies. Many homeowners and renters have been delighted to learn how much they can save by changing from their current insurer to another insurer.
• Whatever company you choose, ask how you can reduce your premium. For example, tak ing measures to improve home security may result in a premium reduction, although, of course, you will have to incur the up-front cost in order to receive the premium reduction.
• Most people select a low deductible on their homeowner’s or renter’s insurance without think ing. If you have a bit of a financial cushion in other words, if you can afford to pay, say, the first $1,000 of a loss select a higher deductible and save some premium dollars.
Automobile Insurance
Ways to reduce your auto insur ance premiums abound.
• Increasing the deductible on your collision cover age to $500 from $200 could reduce your collision insurance cost by 15 to 30 percent. You may want to consider dropping your collision coverage or comprehensive coverage if you drive an old car, as I do.
• You may be able to eliminate some of the medical coverage on your auto policy if it duplicates cov erage that you already have on your health-insurance policy.
• The total cost of insurance is affected by the type of car you drive. Buying a “low-profile” car, one that’s less costly to repair and less attractive to thieves, will save you premium dollars. It will also save you money when you buy the car in the first place, since these cars are as unattractive to car devotees as they are to thieves, but who cares (other than your kids, who, by the way, aren’t paying for the car)?
Disability Insurance
Disability income insurance provided by your employer may or may not be suffi cient to meet your needs in terms of policy provisions and extent of coverage. If you have to purchase this absolutely essential coverage individually, the follow ing suggestions may save you some money. Incidentally, you have to have a job in order to have a disability policy.
• As with health insurance, many professional organizations and affinity groups provide disabil ity insurance coverage for their members, which is much cheaper than individually purchased poli cies.
• If you do purchase an individual policy, you’ll be dismayed at how expensive it is. Disability policies have more options than most new cars. Some may be worthwhile, such as cost-of-living adjustments for benefits, but don’t buy any bells and whistles that you don’t need.
Life Insurance
When economic times get tough, many people see dropping some or all of their life insurance coverage as an easy way to cut expenses. Instead of reducing your coverage and jeopardizing your family’s security, try to make the most of your life insurance dollar by heeding the following sugges tions.
• You may have too much life insurance. If so, you can save money by dropping un necessary coverage. Life insurance needs change and in some instances decline, particu larly after children leave the nest. Re view your coverage periodically to ensure that you have an appropriate amount.
• There are plenty of ways to buy low-cost life insurance coverage if you devote some time to it. It will be time well spent, because identical life insurance policies vary dramatically in price. Why pay more for something as dull as life insurance? First, your employer may offer you the option of buying additional coverage, usually at low group rates.
Next, comparison-shop for life insurance coverage on the Internet or by simply asking friends and colleagues if they are aware of companies that offer lowcost life insurance. If you decide to replace a more expensive policy with a cheaper policy, always obtain the new coverage before dropping the old policy.
• Avoid credit life insurance that may be sold to you when you take out a loan. Credit life insurance will pay off your loan if you die while the loan is outstanding. This insurance is almost always horrendously expen sive.
The insurance industry is very price-competitive these days, and people have told me nu merous times that by taking a little initiative, or prod ding their agents to take some initiative, they have been able to save hundreds of dollars on their annual insurance costs. Second, make sure you pay only for the policy features and options you need.
All too often, people purchase a “Rolls-Royce” policy when a “Ford” would suit them just fine.
The following suggestions will help you save some insurance money at a time when you could probably use the money for other worthwhile purposes.
One of the few good things to come out of bad economic times is that we are forced out of fear, if not financial necessity to become wiser consumers. I hope that you will carry these good habits, including being a wiser insurance consumer, forward when prosperity returns anew.
Health Insurance
If you are fortunate enough to have your health insurance provided or, more likely, subsidized by your employer, be sure you understand what it does and doesn’t provide.
• You may be offered a choice of plans, each of which offers different types of coverage. Thinking that they shouldn’t skimp on health insurance, many people automatically select the policy that costs the most. Instead, you should select the policy that provides the kind of coverage that you and your family need and it may not be the most expensive policy.
• If you have to buy health insurance on your own, it is almost always cheaper to do so as a member of a group rather than as an individual.
You may be able to obtain this coverage through a professional organization or some other local group, such as the Chamber of Commerce, that offers group health insurance to its members. Your state may also be able to steer you to lower-cost coverage.
Homeowner’s/Renter’s Insurance
There are a few ways that you can reduce your homeowner’s or renter’s insur ance premium without affecting the coverage that you need.
• Obtain quotes from a number of insurance compa nies. Many homeowners and renters have been delighted to learn how much they can save by changing from their current insurer to another insurer.
• Whatever company you choose, ask how you can reduce your premium. For example, tak ing measures to improve home security may result in a premium reduction, although, of course, you will have to incur the up-front cost in order to receive the premium reduction.
• Most people select a low deductible on their homeowner’s or renter’s insurance without think ing. If you have a bit of a financial cushion in other words, if you can afford to pay, say, the first $1,000 of a loss select a higher deductible and save some premium dollars.
Automobile Insurance
Ways to reduce your auto insur ance premiums abound.
• Increasing the deductible on your collision cover age to $500 from $200 could reduce your collision insurance cost by 15 to 30 percent. You may want to consider dropping your collision coverage or comprehensive coverage if you drive an old car, as I do.
• You may be able to eliminate some of the medical coverage on your auto policy if it duplicates cov erage that you already have on your health-insurance policy.
• The total cost of insurance is affected by the type of car you drive. Buying a “low-profile” car, one that’s less costly to repair and less attractive to thieves, will save you premium dollars. It will also save you money when you buy the car in the first place, since these cars are as unattractive to car devotees as they are to thieves, but who cares (other than your kids, who, by the way, aren’t paying for the car)?
Disability Insurance
Disability income insurance provided by your employer may or may not be suffi cient to meet your needs in terms of policy provisions and extent of coverage. If you have to purchase this absolutely essential coverage individually, the follow ing suggestions may save you some money. Incidentally, you have to have a job in order to have a disability policy.
• As with health insurance, many professional organizations and affinity groups provide disabil ity insurance coverage for their members, which is much cheaper than individually purchased poli cies.
• If you do purchase an individual policy, you’ll be dismayed at how expensive it is. Disability policies have more options than most new cars. Some may be worthwhile, such as cost-of-living adjustments for benefits, but don’t buy any bells and whistles that you don’t need.
Life Insurance
When economic times get tough, many people see dropping some or all of their life insurance coverage as an easy way to cut expenses. Instead of reducing your coverage and jeopardizing your family’s security, try to make the most of your life insurance dollar by heeding the following sugges tions.
• You may have too much life insurance. If so, you can save money by dropping un necessary coverage. Life insurance needs change and in some instances decline, particu larly after children leave the nest. Re view your coverage periodically to ensure that you have an appropriate amount.
• There are plenty of ways to buy low-cost life insurance coverage if you devote some time to it. It will be time well spent, because identical life insurance policies vary dramatically in price. Why pay more for something as dull as life insurance? First, your employer may offer you the option of buying additional coverage, usually at low group rates.
Next, comparison-shop for life insurance coverage on the Internet or by simply asking friends and colleagues if they are aware of companies that offer lowcost life insurance. If you decide to replace a more expensive policy with a cheaper policy, always obtain the new coverage before dropping the old policy.
• Avoid credit life insurance that may be sold to you when you take out a loan. Credit life insurance will pay off your loan if you die while the loan is outstanding. This insurance is almost always horrendously expen sive.