If you cringe every time your homeowner’s or car insurance bills come due, then it is time to look at ways to cut costs. Many times if you have been with the same insurance company for more than three years, you start to see your insurance rates increase. It may be time to check rates with other companies or to re-evaluate your insurance costs with our current agent. Knowing the right questions to ask and the ways you can lower your insurance costs can help to reduce your insurance bills.
Easy Ways to Reduce Insurance Costs
If you haven’t already done so, there are three tried and true ways to lower your insurance costs for both home and car. These include:
- Raise your deductible. Raise the $250 deductible to $500 or the $500 deductible to $1,000. For cars, you will probably not want to go over the $500 unless the car is very expensive. According to the Insurance Information Institute, raising your homeowner’s policy deductible from $500 to $1,000 can save you up to 25 percent.
- Bundle your insurance. In most instances, insuring your cars and home with the same company will save money.
- Decrease coverage on older cars. Don’t carry full coverage on cars worth less than $1,000.
Ways to Save Money on Homeowner’s Insurance
When checking on a new homeowner’s insurance policy or when talking to your current agent, don’t be afraid to ask questions about the policy. Often, people will make decisions based on what the insurance agent says they need; often, this is more coverage than the individual actually requires.
Don Griffin, vice president of personal lines for Property Casualty Insurers Association states there are up to 10 discounts on house insurance that most people do not know exist. These discounts include:
- Discounts for homes built to higher building codes;
- Discounts for people age 55 and older;
- Discounts for long-time customers; and
- Discounts for installing safety features such as deadbolts and smoke detectors.
Ask your insurance agent about discounts or make sure to check for discounts if you are looking for a new homeowner’s insurance policy.
Ways to Save Money on Car Insurance
It is common for people to buy car insurance after they purchase a vehicle but you really should check on insurance costs before buying a car. The difference between insuring a four-door sedan and a sports car can be thousands of dollars a year. Certain makes and models cost more to insure than others and cars that are rated higher for safety are less expensive to insure than other cars. Do your homework first so you don’t overpay later.
When purchasing car insurance, do look over the policy carefully and ask questions about any extras you see. Sometimes an agent will add extras like roadside assistance or rental car coverage that pads the bill. Ask if these are part of the policy or if you’d save money by dropping them.
When adding a teenage driver to your insurance, ask if you’d save money by adding an older car to the policy. Sometimes, adding a very old vehicle, even one you don’t drive anymore, will lower your teen’s insurance by $200 to $300 dollars.
Ask about low mileage discounts. If you are driving fewer miles than before or using one of the family cars less, ask if there is a discount for this.
Seniors age 55 or older should ask about the discount for taking a defensive driver’s course. The courses are offered for free in most states and can save seniors up to 10 percent on their insurance rates.
Saving money on insurance can add hundreds of dollars to your pocket each year. Ask your agent about discounts or check prices with several different insurance companies to make sure you are paying the least for the most coverage you can afford.
Sources:
Insurance Information Institute “Maximize Your Insurance Dollars in 2010; Avoid the Five Biggest Insurance Mistakes” Retrieved October 19, 2010.
BankRate.com “5 Best Ways to Cut Insurance Costs” Retrieved October 19, 2010.
Deanna Lynn Sletten - Deanna Lynn Sletten has been a freelance writer for newspapers, regional magazines and websites for 20 years. She specializes in the ...
