Itís common news these days that insurance costs have been increasing every year by a steady and growing margin. Thereís been plenty of talk over what to do about it and potential solutions are making headlines.
Whatever happens down the road, there is always one route each individual can take to lower certain insurance costs Ė take control of your situation. Here are some helpful tips and guidelines to take control and lower insurance costs for your home and auto.
A sure fire way to save on insurance costs is to comparison shop by getting quotes from multiple service providers. Youíd be surprised to see how quotes can vary by several hundreds of dollars from one carrier to the next. Of course, the Internet has made this practice infinitely easier. Simply enter your information and quickly have multiple carriers competing for your business.
Pick a solid insurer - An insurance policy is only as sound as the company thatís behind it. Sometimes insurance companies are seized by state regulators for improper practices and in some cases they file bankruptcy as a result of over leveraging themselves.
National ratings services such as A.M. Best and Standard & Poor's ratings score the companyís ability to pay out claims. Usually companies that have at least a BBB rating are the only ones that should be considered.
Another way to reduce premiums, the amount one pays for their coverage, is to raise the deductible or the amount one pays when filing a claim. For example, instead of paying a $250 deductible when filing a claim, raise it to $1000. This might typically result in a 20% savings on your regular payment weighed against the chances that you have to file a claim. This can often come out in your favor depending on your situation.
A win-win way to save on insurance costs is to gain discounts by exhibiting positive lifestyle behaviors like not smoking and maintaining good health. Install security alarms and smoke detectors. Similarly, avoid moving violations and accidents when driving. Being a student will garner savings for younger drivers.
Avoiding filing minor claims is very effective in keeping premium costs low. The dichotomy of insurance coverage is that we need it but donít want to use it. By the same token, insurance companies donít want to regularly write checks. If they do so often, they will raise your premiums. Avoid this by filing only major claims you canít afford to pay out of pocket. The exceptions is an auto accident involving another driver due to liability issues.
If you think ahead, buy a model car that doesnít command high rates. Obviously, an insurance company will view a sports car differently from a minivan. In some cases, a vehicle that is cheaper in cost may have comparably higher insurance costs simply because more claims are made for that particular model.
A good practice is to calculate how much insurance you need and buy no more than that. Upon examination you may find that one policy has coverage that overlaps with another. This occurs sometimes with personal liability coverage.
Along the same lines, if you car is an older model, it may not be economically viable to maintain full coverage. The cars replacement value may amount to less than the insurance policy, especially when factored over several years time. And for newer models, safety features like anti-lock brakes and air bags can reduce premiums as well.
Lastly, combining home and auto insurance with the same company will gain you discount rates. If you find some attractive features in separate offers, you can use these as bargaining chips to get the coverage you need.
Appropriate levels of insurance coverage are like fingerprints, no one has the exact same requirements. These are some general guidelines for home and auto insurance coverage but itís best to listen to your agents recommendations but make choices based what you feel is in your best interests. Just be sure not to skimp because youíll regret it should you ever need to rely on your insurance to cover large expenses and itís inadequate for your financial needs.