Cars, Housing, Insurance, Personal Finance, Saving Money

25 Ways to Save Money on Your Insurance Plans


By Sara Lennon

If there was a big list entitled “The Procrastinator’s Massive List of Stuff That Never Gets Done”, you can put a fair bet that saving money on insurance would be near the top. However, that doesn’t make it a bad idea: sparing a couple of hours to seriously consider your options could save you hundreds of dollars. These tips can help you get started:

Ways to Save Money on Auto Insurance

According to the Insurance Research Council, nearly one in seven USA motorists drive without insurance: the cost of which was a staggering $10.8 million to those who were covered during 2007. If you’re tempted to go without, remember that the only state where insurance is optional is New Hampshire. Any other state will punish the uninsured with anything from heavy fines to prison sentences.

Avoid Accidents

Careful, considerate drivers are absolute gold to any insurer. If you’ve avoided accidents in the last three to five years, you might even be eligible for a discount. It’s worth remembering, though, that some insurers will not distinguish between accidents where the fault is not your own and those which you were responsible for. Stay safe, and save money!

Install Air Bags

In the modern day, air bags are a simple act of common sense. They’re also a great way to save a bit of money, as having them installed normally leads to a reduction in the cost of your policy. If you want to check out how many you have installed, the VIN number should tell you.

Avoid The Sports Cars

Needless to say, the type of car that you’re using makes a difference to the cost of your policy. Insurers are going to charge far more for 950 horsepower of untrained road-rage than they will for a pleasant, four-door sedan designed for family trips to the beach. Obviously this shouldn’t stop you buying a sports car, but you’d better be prepared to pay the extra!

Check Your VIN Number

First off, it’s worth clarifying that a car’s VIN number is the 17 randomly mixed letters and numbers (older cars may have less digits) that you’ll find where the dashboard meets the windshield on the driver’s side. If the insurer has this down wrong, it can make a big difference to the costs you’re being charged, as they may believe you are driving a different vehicle.

Beware The Rewrites

Many insurers will periodically re-write policies, leading to variation in premiums and rating plans. That’s why it’s important to ensure that you regularly check if there have been any modifications to your policy. If you don’t, you might end up being stung for more than you expected!

Think Of Where You Live

More and more insurers are taking into account the area in which you live to work out the right price for your policy. People who live in the big cities, for instance, will pay more than those who live in rural areas. Always check to make sure you’re being rated for the right area.

Retired Discount

If you’re retired, always check to see if you’re eligible for a discount on your policy. Spending the time to do so is well worth your time, as the amount saved can be substantial.

Don’t Be Too Loyal

In a lot of cases, it doesn’t pay to be loyal. You’ll often find that the cheapest policies can be obtained by switching companies. It’s well worth shopping around to see what the other firms can offer you.

New Car Discount

While this isn’t something that’s applicable to everyone, those in possession of a new vehicle might be eligible to apply for a discount as a result. Get in there early, though, as this saving won’t be available to anyone once their vehicle is a couple of years old.

Loyalty Discounts

OK, we talked about not remaining loyal earlier, but that doesn’t mean it’s not worth asking. Some companies will offer discounts to their long-term customers, so always check before you set off for cheaper rates.

Ways to Save Money on Life Insurance

Life insurance is just one of those things that divide opinion. To some, it’s complete common sense. To others, it’s a waste of money. However, if you’re considering getting some, there’s no harm in trying to save yourself some money on the policy.

Obviously we’d never recommend lying on a policy (that really isn’t common sense), which is why we’ve put together these five entirely ethical ways to help reduce the cost of your coverage.

Quit Smoking

As well as meaning that you’ll smell much cleaner, giving up cigarettes will do wonders for your life insurance costs. Because of the massive health risks that come from smoking, anyone who does is considered to be a high–risk customer. What does that mean? Yep, it means far more expensive policies.

Shop Around For The Best Deals

Just because one firm offered you the best house insurance costs doesn’t automatically mean they’ll be the best for your life insurance too. There are so many price comparison sites out there that not taking five minutes to get the right price is simply crazy. However, don’t forget to check out the levels of coverage that policies offer rather than looking purely at the price. It’s often a false sense of security to go for the very lowest offer, as it often leads to life insurance that doesn’t really cover much at all!

Improve Your Diet And Exercise Regime

With many insurers requesting a full medical before they will offer anyone coverage, it’s important for you to do what you can to keep yourself in the best shape possible. While we’re not suggesting you go out and run a marathon, simply improving your diet and exercising 3-4 times a week could save you hundreds on your policy. For instance, Phoenix Cos. Inc offer up to 20% on policies for those who have a verified BMI between 19 and 25.

Get A Decreasing Term

If one of the main things concerning you regarding the purchase of life insurance is keeping up with the payments, then you might want to consider the merits of a decreasing term. As the name suggests, this policy reduces in value over time, leading to lower premiums. This is the ideal investment if you’re expecting other expenses (mortgages, loans, children!) to increase in future.

Forget Being Loyal To Your Provider

As with motor insurance, it isn’t necessarily a good idea to remain loyal to your present provider. If there have been no decreases to the quality of your health since you took the original policy out, it’s worth asking around to see if any other company will offer you a better option. You’ll quite often find that switching will save you a decent amount of money.

Ways to Save on Your Home Insurance

Granted, home insurance isn’t going to win any awards for being exciting, but it’s certainly something you should take seriously. Just ask anyone who has suffered damage to their property without it! If you want to save money on your home insurance, keep reading…

Get Senior Discounts

Those who have retired are likely to get big decreases to their policy, simply because the additional time that they have to maintain their home and spot potential risks to the property mean that they are far less likely to make a claim. If you’re over 55 and retired, check and see if any discounts are available to you.

Make An Annual Check Of Your Policy

One thing that you should add to the “to-do list” is to spend some time once a year on reviewing the policy you have, and to make the necessary adjustments. Perhaps you’ve sold some valuable possessions and the contents of your home are now worth less. If so, there’s little point paying over on your policy. If you’ve made any substantial changes to the building itself, then reviewing the policy is essential.

Take Advantage Of Electronic Payments

With many insurers charging over $5 for payments carried out via mail, it’s worth setting up an automated payment for any policy. Not only is this far more convenient, it could save you a couple of hundred dollars a year!

Consider Replacement Cost Coverage

If you have a lot of valuable individual possessions, it might actually save you money to invest in a policy that offers replacement cost coverage. This will enable you to obtain the full price of the item when you’ve submitted your receipt. This can lead to a greater claim than a simple, cover-all-areas-policy.

Check The Private Market

If you live an area that’s considered high-risk by insurers, it might be worth you checking if an independent insurance agent can offer a lower price on the private market. It’s not for everyone, but could well be the best option in this circumstance.

Put Down The Cigarettes

Believe it or not, smoking accounts for almost 23,000 residential fires per year according to the researchers at MSN Money. Interestingly enough, many insurers actually offer a lower home insurance price to households where there are no smokers.

Consider Group Coverage

It’s worth checking with your current employer if they offer any deals on insurance. The larger corporations will often work out deals with insurers that can lead to lower rates for their employees. This isn’t the case everywhere, but it’s worth five minutes of your time asking!

Monitor Neighborhood Changes

Because the area in which you live can have a big difference on your rates, it’s important to ensure that you let your current insurer know if there are any positive changes in your environment. For instance, factors such as storm drains and extra fire hydrants can be seen to be improving the state of the neighborhood, thus potentially leading to decrease in premiums.

Pay On Time!

Reliable customers are valued by everyone, especially in the modern economy. If you’re someone who regularly pays on time and with no hassle, then your insurers are more inclined to reward you with lower rates. Not only this, but you’ll also remove any risk of late payment charges. Quite often, paying the full amount in one go will mean a discount, too.

Don’t Buy Unnecessary Coverage

Although you should ensure that you are covered for every necessary area, there’s absolutely no point in overdoing it. Check your policy to ensure you’re not paying for optional extras that you aren’t going to use. Otherwise, you could be paying for things such as jewelry coverage (when you don’t have any jewelry) or earthquake coverage (if you live nowhere near an area affected by earthquakes!). All you need is enough coverage to ensure your home will be repaired if it gets damaged. Don’t pay for the extras if you don’t need them!

This is a guest post written by Sara Lennon on behalf of Merlin Insurance – the Quebec Auto Insurance and home insurance broker.

(Photo courtesy of David Hilowitz)

3 thoughts on “25 Ways to Save Money on Your Insurance Plans

  1. Don’t assume your group’s auto insurance offering is the best deal. Comparison shop and talk to your financial adviser.

  2. Your advice for getting a decreasing term for life insurance makes absolutely no sense at all!!! That is the worst advice ever! decreasing term life insurance is for when you don’t need the life insurance any longer — not when you are going to have more expenses (which the life insurance would have to cover if you died). Do you even know what life insurance is for?

  3. Years ago before they renewed my car policy they would send a questionaire and one of the questions was mileage and where the car was parked. I realized I hadn’t gotten one for years so I called them up. With hubby working from home and me on disability, most of our driving is to the doctor or grocery store. In other words 3500-4000 miles a year! By the time I got off the phone I had knocked our yearly bill down about $200. When hubby took the car in to get inspected we got to skip one of the required tests because we hadn’t driven enough miles so more money saved!

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