Insurance coverage exists to protect you from costly repairs and replacement should an accident happen – at home or on the road; whether you’re at fault or not. But like all businesses, an insurance company is looking to turn profits. While there’s nothing wrong with that, it’s up to you, the consumer, to do your homework so you can ensure the best coverage at the lowest cost possible.
Insurance companies know that you’re busy and don’t often have time to research the best price on the coverage you need. So be smart about shopping around. Look for discounts, compare prices, and ask a lot of questions. Your insurance agent won’t thank you, but your savings account will! Here are some things that your insurance company doesn’t want you to know but will get you on track for the right coverage at the right price.
1. You can probably lower your car insurance.
New technology allows auto insurance companies to monitor your driving habits and reward good driving with lower rates. A telematics device can track when and where you drive, how fast you’re traveling, as well as how you interact with the cars near you. Insurance companies will reward those good habits with discounted rates.
According to Forbes, about 1.4 million drivers have tried out the program, and those who opted-in have saved 10 to 15 percent over the course of their policy. If you’re a good driver, ask your insurance company about having a monitor installed in your vehicle. But be warned: Up to now, there has been no penalty for those with less-than-perfect driving habits. That may change as companies look to subsidize the cost of the monitors and the discounts they provide.
2. Where you live matters.
You chose your home for a reason, and location likely played a role in your decision to buy where you did. Just like you, your home insurer also feels more comfortable if you live in a gated community, near a local fire department, or if you have a home security system. When shopping for insurance coverage, be sure to mention any security or location information that may lower your overall insurance costs.
3. Unadvertised discounts are available.
Just like the “secret” menus at popular restaurants, insurance companies also have discounts available that they don’t make public. For example, if your home security system includes gas-leak detection or cold-temperature monitoring, you could qualify for a discount. New wiring, roof upgrades, homeowners associations, and home renovations are just a few ways to earn discounts. The premise is simple: Anything that lowers the risk of damage to or theft from your house will save the insurance company in claims; and at least some of that savings should be passed along to you, the consumer. So even if it’s not listed on the policy, ask if a discount is available.
4. There’s an insurance buyer’s guide available.
Your insurance company likely does not want you to know that state insurance departments publish insurance buyer’s guides. These guides include a list of companies and often sample rates so you can compare sample prices before ever having to pick up the phone or scour the Internet. This allows you to quickly compare overall prices so you can see if your current coverage is in the ballpark of some of the other companies in your area. Simply search online for the insurance buyer’s guide in your state.
5. Try more than one insurance company agent.
If you don’t have time to find the best deal, working with an independent insurance agent is the answer. But each agent only works with a handful of companies, limiting the number of quotes you will receive. So call two agents and tell them you are shopping around – and that you’re working with another agent. Agents will work hard to find the best coverage for you because they don’t get paid until you sign up.
6. Ambiguity will work in your favor.
Interpreting an insurance policy can be a difficult task, especially if you’re in the throes of a crisis or claim. Fortunately for you, as the policyholder, you benefit from any ambiguity in the policy. If the coverage or exclusions aren’t clear, they must pay the claim.
Insurance is a non-negotiable expense, but with a little homework and research, you can come out ahead. While your insurance company may not like your savvy new ways, we want you to get the biggest bang for your buck.
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