How to Save Money on Your Insurance
As you might imagine, insurance can get expensive if you don’t know how to shop around for the best deal on your coverage.
Luckily, there are plenty of tips and tricks out there to help you save money on your health, auto and home insurance policies.
Here are the ones that have worked best for me over the years. See which ones apply to your situation and consider implementing them in order to keep more cash in your savings account or emergency fund.
Review your coverage regularly
It’s important to review your insurance coverage regularly, especially if you’re paying for it out of pocket. Sometimes your life changes and you need to update your coverage – like when you have a new baby, or when you buy a new home.
If that’s the case, talk with your agent about how you can save money by updating the plan. The best way to do this is by waiting until the end of your policy period (typically November) before switching over to the new plan year (usually December).
You might also be able to take advantage of some open enrollment discounts if they’re offered by your employer or if there are any tax incentives available in your area.
For example, subsidies under the Affordable Care Act can help lower costs, while tax credits may help make premiums more affordable.
There are also programs that offer free health care such as MediCal in California or Mass Health in Massachusetts.
Compare rates
Start by comparing insurance rates online. You may be able to save up to 40% when you compare rates for your car, health, and homeowners insurance.
Here are some other ways you can save money:
– Sign up for a high deductible plan for your health coverage if your income is low. This way, you’ll only have to pay a small copayment or coinsurance when you visit the doctor or get a prescription filled.
– Get an alarm system installed in your home that’s monitored 24 hours a day. If there’s an emergency such as a break-in, fire, or medical emergency, the monitoring service will call you so that you can notify authorities without having to be at home waiting for them.
Raising your homeowners’ policy deductible from its standard amount of $1,000 would also result in savings because most claims are below this amount.
Consider a higher deductible
One of the easiest ways to save money is by raising your deductible. The higher your deductible, the lower your monthly payment will be.
For example, if you have a $500 deductible and only visit your doctor twice in a year, you would only owe $100 out of pocket instead of $200.
Raising your deductible can reduce insurance premiums anywhere from 10-40%. The one downside of this strategy is that if you need major medical care, it might not be covered by your health insurance.
You may want to buy supplemental insurance or increase the amount of your life insurance coverage to offset these risks. Some families find an umbrella policy (coverage for injuries outside of an auto accident) helpful as well.
Other options include going with a high deductible plan and adding specific riders like dental or vision coverage. If you’re looking to cut costs but don’t want to lose access to necessary services, consider seeing doctors who accept Medicare assignment.
They’ll be able to provide the same level of service at a fraction of the cost because they are reimbursed directly from Medicare rather than having their bills go through private insurance companies first.
Finally, consider shopping around – just because your employer offers an affordable package doesn’t mean it’s the best deal available.
Take advantage of discounts
There are many ways you can save money on your insurance. You can start by taking advantage of discounts offered by your employer or other organizations, such as AAA or AARP.
You may also qualify for a discount if you take care of routine maintenance of your car or house. You might also be eligible for a discount if you have a pet that has been spayed or neutered, smokeless tobacco product users, eat healthy foods, and have good grades in school.
Some auto insurance providers offer discounts if you use public transportation more than driving your car, or drive less than 7500 miles per year.
By understanding the nuances of your personal situation, you can find ways to cut costs and improve benefits so that they best meet your needs.
It’s easy to just renew at the same level each year without looking into new benefits available through the insurer and changes in premiums due to lifestyle changes.
Use public transportation
Public transportation is not only good for the environment, but it’s also a great way to save money. The average American spends over $10,000 a year on their car and that doesn’t include fuel or maintenance.
Public transportation costs much less and you can find routes that fit your lifestyle. If you don’t have public transit available in your area, try taking a bike.
You’ll still save on gas, wear and tear, and many insurance companies offer discounted rates for those who bike! In addition, biking can help with weight loss or fitness goals.
You may be able to even deduct some of the cost of purchasing a bike from your taxes if you use it primarily for work purposes. you’re currently paying for parking at your workplace, look into alternative options like carpooling or using a rideshare service.
Driving alone, you’ll reduce wear-and-tear on your vehicle while also saving money. When buying an auto policy, choose one with lower premiums based on discounts offered by the company (e.g., safe driver).