Review Your Insurance Policies for 20% Savings (or More!)
With the New Year here, Clearsurance.com released a guide to reviewing insurance policies. Reviewing policies can lead policyholders to make decisions to better and more appropriately protect their assets.
Saving 20% or more on insurance premiums could add up to hundreds of dollars a year.
Reasons to Review Insurance Policies
There are two reasons to review insurance policies.
First, reviewing insurance policies can help policyholders ensure they have the coverage they need. For example, if they’ve gotten a promotion, bought a new house, or received an inheritance, they may need to consider an umbrella policy to protect themselves from liabilities that could take all their assets.
Second, reviewing policies can help policyholders find less expensive coverage. Shopping around and gathering quotes can help customers find the companies best suited to their needs with competitive prices.
Process of Reviewing Policies
Comparing quotes is an excellent place to start for those wishing to review their policies. The best practice is to compare quotes every six months. Using the New Year as a catalyst for a quote comparison is an excellent way for people to get into the habit.
According to Clearsurance.com, there’s no requirement to switch providers. Customers who like their provider and find their current rates comparable to others can stay. But some people discover they could save hundreds of dollars a year by switching.
Getting the Right Coverage
Some drivers choose to purchase the minimum car insurance required. These coverage levels are insufficient for real-world protection since the price of a new car exceeds the minimum property damage limit in every state.
Part of a policy review should include making sure a customer has enough coverage for adequate protection.
On the other side of that review is reducing insurance coverage when appropriate. For example, drivers with a vehicle over 10 years old may need to evaluate whether they still need full coverage or if it’s a better idea to switch to liability-only coverage.
Tips for Improving Insurance Premiums
Paying less for insurance is a goal worth putting some effort into attaining, especially if policyholders can save several hundred dollars a year.
Improved Credit Scores Lead to Better Insurance Premiums
In a few states, insurance providers can’t calculate credit ratings into insurance risk, but in most of the United States, it’s common practice. Those who improve their credit score may be surprised by how much it affects their insurance premiums.
One way to improve credit is to pay bills on time. Any payments that are made to companies that report to the credit bureaus will be reflected in credit reports. Credit card companies, auto lenders, and mortgage companies all report.
Individuals who rent can request that their property owner report their payments to the credit bureaus. In some cases, they can.
People can also improve their credit scores by keeping what they borrow on credit cards to less than half of their credit limit.
Discounts Can Reduce Insurance Premiums by 30% or More
Discounts are many policyholders’ best savings option. Some of the most popular are as follows:
- Bundling
- Claims-free
- Good student
- Loyalty
- Military
Each of these discounts reflects a factor that reduces a policyholder’s risk of filing a claim. The lower a customer’s risk, the lower their insurance premiums will be.
Usage-Based Coverage Options Often Result in Lower Rates
Many insurance companies offer a discount just for using a telematics device or app that monitors driving habits. Drivers can qualify for an even higher discount if they practice good, low-risk driving habits.
Not all insurance companies guarantee a discount, though. There are a few companies that will raise rates if the driver demonstrates high-risk driving behavior. So, drivers should consider the risks and rewards before enrolling in a usage-based program.
Read Clearsurance.com’s entire report here: New Year’s Resolutions: Review Your Insurance Policies.