Be Careful When Trying to Save on Insurance!

Everybody likes saving money, but trying to pinch pennies on insurance can often come at a tremendous cost. If you wind up needing to make a claim – and keep in mind that you never know what’s going to happen – you’ll likely end up paying out far more than you could have ever hoped to save in the first place.

It’s reckless to try to reduce your coverages to dangerously low levels and even worse to try to forgo a policy entirely (not to mention that it’s illegal to drive uninsured in Connecticut, and you’ll be hit by a hefty penalty if you skip on health insurance). However, there are ways to save money when trying to save on insurance without exposing yourself to unnecessary risk.

If you’re thinking about making changes to your insurance policy to save money, consider these key issues below, and then give us a call. We can help make sure you’ve got the right protection at a price you can afford.

What to Consider When Trying to Save on Insurance

  • Make sure you’re getting the appropriate discounts and credits: Most insurers offer a variety of policy credits and account discounts that can translate into significant savings — without endangering the level of protection you need for your home, autos, and other valuable property. Looking for other easy savings? If you purchase multiple policies through the same insurance company, you’re likely to receive further discounts. There are also benefits for demonstrating that you’re safe or responsible. Motorcycle and boat owners who complete approved safety courses can qualify for discounts. Likewise, your child’s grades can save you money as well because families with teen drivers who earn good grades in school may qualify for auto policy discounts.trying to save on insurance
  • Increase deductibles for cost savings: Only a small percentage of homeowners have claims in any given year, so you could always consider increasing your deductible. The benefit is that your premiums will be a little cheaper, although you’ll have to pay a bit more before meeting your deductible.
  • Specialty lines coverage options: Own a classic car or an RV? If their use is seasonal, you can typically reduce your coverage to just liability during the off-season, then add full coverage only when you are actually using the vehicle.
  • Full payment on policy: Depending on your financial circumstances, you may be able to make lump-sum payments instead of partial premium payments (i.e., monthly or quarterly payments). Partial payments often include small transaction fees, so paying the full amount can help you avoid those extra costs.

What to Avoid When Trying to Save on Insurance

It’s also important to know what not to do while looking for cost savings. Here are some things you should avoid:

  • Carrying only the minimum state-required amount of uninsured/under-insured motorist coverage on auto policies, or to cancel it entirely if it is not required in your state: According to the Insurance Research Council (IRC)*, the correlation between the percentage of uninsured motorists and the unemployment rate is high — when the economy is struggling, more people go without insurance. However, whatever problems you might have now will only get far, far worse if you get into an accident without the right amount of insurance.
  • Ignoring renters insurance: Even in a good economy, renters tend to overlook this coverage. Part of the problem is the assumption that the landlord’s policy has them covered. However, a landlord’s policy usually only covers the building’s structure, not the individual renters’ contents. Imagine having to replace furniture, clothing, and other personal property out of pocket because you excluded this essential, affordable coverage and then suffered a devastating loss from a burglary or other covered event.

Saving money may be important, but so is making sure that you’re adequately protected.

If you’re looking for ways to save, or want to review your policies, be sure to contact us or give us a call today at (203) 775-2564 (because who knows what will happen tomorrow!)

*Insurance Research Council, January 29, 2009.

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