Tips for saving in 2012 on your insurance
We need insurance as a tool of risk management so that there is compensation for life and property. Did you know that an average American spends close to $2200 every year as premium on life, homeowners’ and auto insurance? On an average, only 1 in 15 people actually make a claim. But that does not mean you should not go for insurance, because it covers risk. After all, nothing is predictable in today’s world. Also, considering that auto insurance is required by law, you really do not have much of a choice.
Let us look at how we can save money on various types of insurance
1. Auto Insurance – The most common types of auto insurance is collision and comprehensive insurance. Collision covers the repair cost after your vehicle has met with an accident and comprehensive insurance provides immunity against relatively common risks like theft and fire. One of the best ways to save money in auto insurance is by increasing the cost of deductibles. So increasing the cost from $250 to $1000 on comprehensive insurance can give you a savings of $100 or 40 percent per year. A smarter way is to put this $1000 in an interest bearing account that is managed especially for these risks. So, when there is an incident of fire or theft, you can divert the money from this interest bearing account to pay as deductible rather than pay from your own pocket.
2. Homeowners Insurance – Look for competitive bids online for a good deal of homeowners insurance. Do not make claims for small accidents, you can handle them yourself. Also take adequate precautions to keep your home theft-proof and fire-proof by installing security camera, fire alarms etc.
3. Life Insurance – Do not look at life insurance as an investment but as a pure risk cover. If you tie it up with retirement plans, you may end up paying more money because a major component goes as investment rather than covering life. Also stay healthy, do not smoke, do regular exercises and be as fit as possible.
Commonly speaking, here are ways in which you can save money on insurance
• Read your policy carefully – Not only should you read your policy terms and conditions before applying for insurance, you should also pay attention to the policy changes that happen in future.
• Get insurance from just one provider only – If you get insurance from one provider which is providing very good service, you can get discounts as well because the insurance company will like to reward you for buying most types of insurance from them. Also since you will be dealing with one company, it becomes easier to manage and pay the premium.
• File few claims – If you keep on filing claims for every small thing, the insurance company will raise the cost of the insurance.
• Raise the deductible – The lower the deductible amount, the higher is the premium.
• Get insurance quotes online – Do a though check for low insurance quotes online and find out the best quotes from authority websites and make your decision.
