Shop Around –Let’s face it, it’s much easier to pick a company and just forget about it. They’re all the same, right? The truth is, insurance companies change their rates regularly depending on how profitable the company is. They may even change several times in a year and know that most people won’t bother to shop around. I recommend getting quotes at least every other year if not more often. If you can save a few hundred dollars, isn’t it worth a phone call or two? Better yet, drop off, fax or email your current policy to an independent agent and let them do all the work.
Know your coverage – When an insurance company denies a claim, most people point fingers at the company. The truth is, most denied claims are the fault of the insured. All policies have exclusions that are a necessary part of an insurance contract. Without exclusions, people would be putting in claims for letting their tires go bald, for example. The secret is to know what is covered and what isn’t. If something that you need is excluded, many types of coverage can be found as endorsements or by purchasing a separate policy.
Pay attention –According to the NHTSA, 80% of accidents are caused by distractions. http://www.adslogistics.com/blog/bid/40558/NHTSA-Releases-Top-10-Causes-of-a-Car-Accident. Don’t be a stupid driver with a Smart phone. When you’re driving, you need to focus on driving, not texting, phone calls or even your hair and make-up. Trust me, you’ll look much better without mascara than you would without a head. The reduction in claims, particularly serious injuries, will have a measurable effect on insurance rates.
Slow down –I have lead-foot syndrome and have difficulty obeying the Speed Limit at times, although in recent years, age and wisdom are starting to overcome this deficiency. I’m like most drivers and feel I could compete with Andretti or Jeff Gordon if given the chance. The problem is not your skill, but the variables you can’t control. The world’s best driver can’t predict a child running out into the road, or the car in front of him braking for a squirrel. Driving fast reduces your reaction time. Again, less claims means cheaper rates.
Bundling – Bundling has become a catch-phrase in the insurance industry recently. It simply means insuring your cars and home and even other items with one company. This is good for the company because customers are less likely to shop-around when they have multiple policies in one place. In return, the insurance companies provide discounts, often substantial, when customers do bundle. Ask your agent about these discounts and your best options.
Use an Independent Agent – If every car dealer in your town sold Ford, what do you think would happen to the price of Fords? The same is true for insurance. You want options so you can compare price and coverage to make sure you get the best policy for you. An Independent Agent offers many advantages not available with shopping online or directly with a company. They work for multiple companies and are familiar with the benefits of them. Choice is power.
Be Honest – Resist the temptation to conceal or misrepresent your situation to the agent or the company. Although you may save a few dollars by denying you have a fireplace at your house, if the house burns down from it, most likely your claim will be denied. So now the money you did spend on insurance was wasted, you’re without a home and you face fraud charges. Furthermore, if everybody was honest, the premiums would decrease substantially.
Fight Fraud – You should not only resist the temptation to commit fraud yourself, but also become aware of it around you and take steps if possible. Your neighbor who is on workers compensation but is working on his house is being paid by you. Your uncle who received a 60” TV when his 20” TV was destroyed by lightning got it using your money. Insurance companies spend BILLIONS on fraud annually and it’s one of the biggest reasons our premiums are so high.
Don’t Cancel – One thing insurance companies have learned is that people who pay their bills and maintain coverage on their homes and cars are less likely to cost the company money. So naturally, many companies offer discounts to customers who consistently maintain their policies. Many times I’ve had customers who sold their cars and cancelled their policy after years of continuous coverage. A month later they buy a car and look for insurance, only to find it’s now hundreds of dollars more! Your agent can provide great advice on situations such as this.
Check for discounts – The trend in the industry now is discounts. Rather than changing the overall rates frequently, it makes more sense to keep fairly consistent rates, but adjust to individuals by using discounts. For example, one common company lists over 25 possible discounts a customer could be eligible for, from things such as being married, owning a home, education level, how many cars you have and even for getting an advanced quote. When you shop for coverage, or even review your existing policy, make sure you’re getting everything you’re entitled to. Ask your agent what discounts are available.
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