27 February 2009

Save Money on Insurance - Auto, Homeowner, Renter, Life

Auto Insurance-

  • You can save money by calling at least four of the lowest-priced, licensed insurers to learn what they would charge you for the same coverage. Shop around again every few years to make sure your company is still the best deal.

  • Raise your deductibles on collision and comprehensive coverage. Make sure whatever amount you choose is something can can afford just in case you do have a claim. I don't want to hear you say "I didn't fix my car because I couldn't afford my deductible." You can also opt to drop this coverage completely if there's no lien holder.

  • Each state has it's own rules on minimum liability coverage (for the other guy's car and medical bills, if you are at fault). You might want to lower your liability closer to this dollar amount.

  • Make certain that your new policy is in effect before dropping your old one.

  • Buy your auto and homeowner/renter policy from the same company - many gives multiple policy discounts.

Homeowner/Renter Insurance-
  • Contact at least four insurers to learn what they would charge you for the same coverage.

  • For homeowners, the "dwelling" coverage needs to be enough to cover rebuilding your home as it was. This is a construction price. It is not necessarily what your house is worth on the real estate market. These are two different numbers.

  • "Contents" is the coverage for your stuff inside. It's the things you'd pack into a truck and take with you when you move. Basic policies pay "Actual Cash Value" which is the used value of an item. A 2 year old tv is worth more than a 10 year old tv, assuming similar technology and features. "Replacement cost" is the reasonable cost to replace something. Most policies will advance you the Actual Cash Value. Do you want Replacement Cost? Or are you willing to settle for Actual Cash Value?

  • Make certain your new policy is in effect before dropping your old one.

Life Insurance-
  • If you want insurance protection only, and not a savings and investment product, buy a term life insurance policy. Term policies are cheaper.

  • Contact several companies for quotes first.

  • Whole Life, Universal Life, or other cash value policies are more expensive. Get them only if you plan to hold onto them for at least 15 years. Once your policy is canceled (you switch to someone else) all those extra investment dollars are lost.

  • Check the National Association of Insurance Commissioners website (http://www.naic.org/cis/) or your local library for information on the financial soundness of insurance companies.



Village said...

Thank you for this article and information. after I read, I get the benefit


Liz said...

Village - hope it helps! :D