While pricing should never be the only reason for selecting an insurance policy or advisor, there are ways to control the cost of your home or auto insurance without sacrificing your coverage options.
For your home:
Consider increasing your deductible. Your deductible is the amount of money you pay out of your pocket for a claim before the insurance company pays. If you can afford to assume a larger part of the risk by increasing your deductible, you can lower your premium.
Communicate updates to your agent. Some companies will reward you with a discount if you have updated the roof of your home.
Factor in the cost of insurance when you purchase a home. Flood coverage is not included in a standard home policy, so if you are in a flood-prone area, you will need to consider the additional cost of flood insurance. The same is true for earthquake insurance. The distance to a fire hydrant, whether your home is frame or brick, and even how close you are to the fire department can also affect your premium.
Insure to Value. It’s important to know the replacement value of your home so you don’t underinsure. If you’re not carrying enough insurance and you have a loss, you stand to lose more money than you will ever save through a lower premium.
Remember that homeowner’s insurance is designed to protect you from the unexpected. Homeowners insurance is not a maintenance policy. It is not designed to pay for a chimney sweep, clean the gutters or your dryer vent, or replace an aging appliance due to wear and tear. Regular upkeep can go a long way in preventing damage down the road.
For your automobile:
Increase your deductibles. Again, if you assume a larger portion of the risk by increasing your deductibles, you can lower your premiums.
Choose your vehicles carefully. If you are considering buying a new car, check with your agent to see how the rate for the car you want compares with other models. Premiums are often higher for most luxury and sport model cars because of higher accident repair costs, high performance engines, or auto theft.
Don’t settle for minimum limits when choosing your coverage. While it might seem like a cost savings on the front end, accidents usually cost much more than minimum limits. If you are found liable in an accident and someone is seriously injured, you could be faced with thousands of dollars in bills you will have to pay out of your own pocket. (This is another reason why we highly recommend an umbrella policy.)
Consider a telematics-based program. With the ongoing development of technology in cars to help us drive safely, most insurance companies are offering the opportunity to lower your auto insurance cost based on your driving behaviors. Click here to learn more about telematics.
Be a defensive driver. One at-fault accident or violation can increase your rate and place you in a higher-risk category.
Be aware of how and where you park. Often, the cost of vandalism and auto theft is overlooked, and these factors drive up the costs of auto insurance for everyone. Be sure to lock your doors at night and don’t leave your purse, wallet, or other valuables inside the car, and especially not in plain sight.
Ask about other potential discounts, including multi-car, home ownership, continuous insurance, safe driver, new car, good student, driver training, student away at school discounts. Some companies even offer an early quote discount.
In general:
Maintain a good credit record and pay your bills on time. Insurance companies consider your credit history when determining your premium.
Don’t change insurance companies every year. Some companies offer discounts for being a long-term customer.
Place your coverage (also known as bundling) with the same company when it makes sense to do so. Many companies offer multi-policy discounts, so if your home and auto are not with the same company, you could be missing out on potential savings. In addition, Auto-Owners, one of our partners, also offers a great discount on life insurance if your home and auto are together.
Consider paying your premium in full or by an automatic draft. Some companies offer discounts if you are willing to pay in full or quarterly, and some will offer a discount if you pay by automatic draft.
Talk with your agent before you decide to file a claim, so you know all of your options.
We are here to help with all of your insurance needs. Contact us today!
