9 Tips to Save on Insurance

posted by Andrea | 01/29/2016
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As I mentioned earlier this week, Dave and I purchased a new-to-us minivan last weekend! We were so excited to finally get it in our garage on Tuesday — and I had way too much fun vacuuming it out, situating all the carseats, and loading it up with all the gear we like to keep in the car.

Of course, along with the new van came the need for more insurance… ugh!

Insurance is one of life’s necessary evils. We pay the premiums every year even if we don’t use any of the benefits — but at least we’re covered “just in case”.

I often think of how much money we could save by not having health insurance, life insurance, home insurance, auto insurance, etc… but then I quickly remind myself how lucky we are to actually have insurance that covers routine dentist and doctor visits — not to mention huge expenses like the births of our children or our car accident a few years ago!

There are very few things that can blow a budget like unexpected medical bills, a scary car accident, a house fire, or even an unexpected death — so I do realize that insurance is very necessary. However, I’ve learned that there are still a few things we can do to make sure we’re not paying more than we have to for our insurance.

While I understand that all insurance companies are different, here are a few things we’ve done to save on our insurance.

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9 Tips to Save on Insurance

1. Stay Healthy.

This might sound obvious and overly simple, but one of the easiest ways to save on medical and health insurance is to stay healthy. Wash your hands, eat more nutritious foods, get more sleep, exercise regularly, disinfect your kitchens and bathrooms, wash your toys every few weeks, teach your children healthy-living habits, etc. etc.

Dave and I were even able to get a better deal on life insurance because we both were healthy and young enough to qualify at the “preferred elite” status. We’re saving about 20% more on our yearly premiums than a “less healthy” person at our same age.

2. Stay Safe. 

Again, this is probably an overly simple solution, but you’d be surprised how much you can save on home, auto, and life insurance by driving safely, wearing your seat belt, not having any tickets or accidents on your record, etc.

Also, it’s worth noting that some home insurance premiums will go up if you have a trampoline or if your pool has a diving board. They can also go down if you have a fenced in yard, deadbolts on all your doors, and smoke detectors in all your bedrooms.

We actually saved a decent amount on our car insurance when I became a work-from-home person. They said that since I wasn’t driving nearly as much, I was less likely to get in an accident so my premiums went down!

3. Bundle your insurances together through the same company.

I realize this isn’t always possible, but we save a significant amount by combining our home and auto insurances through the same company. This also simplifies things as we only have to deal with one company for both insurances.

All our medical insurance is through Dave’s work, and our life insurance is through the same company we have all our other investments and retirement accounts with.

4. Keep your information organized. 

Several years ago, I shared our method for organizing our important paperwork — and I can’t even begin to tell you how much time, money, and stress this has saved us over the years. Not only can we quickly find information regarding all our different insurance providers and policies, we can also catch possible errors in bills or statements.

5. Understand your insurance policies.

Insurance policies are confusing to say the least! I’ve definitely had my share of frustrating moments trying to figure things out — but once I do, everything makes SO much more sense.

Also, by understanding what is (and is not) covered by our specific insurance, I can make sure to ask my doctors for specific brands of prescriptions, request a specific auto towing company, and take notice that our dental appointment are scheduled at certain times throughout the year to achieve maximum insurance benefits.

I learned this lesson the hard way after over-paying for various maternity visits when I was pregnant with Nora, simply because they weren’t scheduled the right way for our insurance to cover them. Thankfully, the nurses and insurance support people helped me figured it all out before Simon and James came along!

6. Don’t be afraid to ask questions.

As I referenced above, I’m not afraid to call our insurance companies and ask questions — ever. That’s their job and they want my business! I’ve never, ever had anyone refuse to answer my questions or treat me like I’m stupid because I’m asking questions… and often, I end up saving money and learning more about how our insurance works.

When I was dealing with all the random bills during Nora’s pregnancy, I probably called our insurance company 10 different times with questions related to our coverage. Every time, they were happy to answer my question or direct me to a website with more information. It never hurts to ask, and by being more informed, you’re more likely to save money.

Also, there have been times when I’ve simply called our insurance companies and asked if there was any way they could save me additional money (without compromising my benefits). I know this might sound a little too “forward” — but I’ve been pleasantly surprised that, more often than not, I end up saving!

For example, whenever we have medical bills, if I pay in full over the phone, I instantly save 10% — no questions asked. Also, we save a small amount on our home insurance because we pay it all up-front, once a year.

7. Pay Attention to your bills. 

Just like I ALWAYS check my grocery receipt before leaving the store, I also ALWAYS check all insurance bills.

For example, we got the bill for our auto insurance 2 months ago, and I immediately called the company because I saw that it was several hundred dollars more than our last bill. It turns out the computer system had accidentally changed our policy to a more expensive plan — oops! With one quick call, I saved about $250.

8. Don’t be afraid to change companies.

For the first year of our marriage, we had a different company for our home/auto insurance. However, the rates started increasing, and around the same time, we learned about another opportunity to get much less expensive insurance due to the fact that Dave was a teacher.

We told our current insurance company about the lower rates from the other company, they said they couldn’t even come close to matching those rates, so we switched. No hard feelings — it was just a much cheaper price for the same quality of insurance.

We are now saving hundreds of dollars every year!

9. Know your deductible.  

When it comes to insurance, there are SOOOOOO many variables that could affect your premium costs — one of which is your out-of-pocket deductible (or what you pay before you can claim any insurance benefit). If you understand those variables and then work with your agent to figure out the best plan for your family, you will most likely see a large savings.

For example, when we purchased our farmhouse, I was somewhat surprised as to the quoted price for our home insurance. So I kept asking questions… and it turns out, that price was quoted with a $0.00 deductible. Dave and I didn’t feel like we needed a $0.00 deductible, and instead opted for a $1000 deductible, for a hefty savings of about $350 EVERY year.

So after 3 years, that savings of $350 per year on our premiums covered the $1000 deductible if anything were to ever happen to our house.

We had a similar situation with our auto insurance and health insurance. We personally feel that since we are relatively healthy, young, safe drivers, etc. that we’d rather pay a much lower insurance premium and have a bit higher deductible if something ever happened.

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Obviously I’m not an insurance expert — and you need to do what’s best for YOUR family.  However, I have asked enough questions and dealt with enough different insurance companies to quickly realize how easy it can be to save a significant amount of money each year — and I like saving money!

Do you have any other ways to save on insurance?

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29 comments

  1. Deb

    02/26/2013

    #1 way to save, don’t have teenage drivers! 😉 TEE HEE HEE

    [Reply]

    Kim Reply:

    Make them pay for their own insurance, that will teach them responsibility.

    [Reply]

    Amanda Reply:

    as a teenager, my parents covered 6mo of my premium during the school year, but the 6mo that was due during the summer while I was working, I was required to pay. When I took a car to college, I remained under their policy, but I had to pay my own part of the policy (which was less expensive because it was attached to my parents policy, but still a good chunk of money for a college student). It’s amazing how much more you care when you have to pay for it!

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    Meilssa Reply:

    Some insurance companies give teen drivers discounted rates for being on the Honor Roll.

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    Kimberly Reply:

    I agree teenage drivers will skyrocket those premiums!!! Our monthly car insurance premium went from $63 monthly to $291 monthly for adding our 18 year old son. There is no way he could pay for that premium on his own right not. He works very part time while waiting to go into the Air Force. Our insurance will not allow us to exclude him from the policy as he lives in our home. Sometimes you have to bite bullet and be thankful you have the financial resources meet all your bills. In order to keep the cost of our premium down we don’t have Medical Payments because we have great medical insurance and we don’t have uninsured/underinsured coverage because it’s just way to expensive in Las Vegas. If someone hits us that isn’t insured or underinsured it would be covered under the collisioon portion of our policy. Of course we would have to meet the deductible first. Thanks for the post!!

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  2. Carlen

    02/26/2013

    I know my insurance gives me a discount if I set up an automatic draft payment. It isn’t a significant discount for me, but it might be for a married couple that bundles their auto and homeowners insurance.

    I have, however, heard of some companies (not the one I use) conveniently **forgetting** to cancel the automatic draft when you change companies, or drafting the monthly payment twice, etc. So you’d have to be diligent in paying attention.

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  3. chris

    02/26/2013

    We pay six months at a time. It saves the $5 monthly fee. ($60 a year). We really are pleased with our company. If you have young drivers, stress to them HOW IMPORTANT it is not to get tickets.

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  4. Courtney

    02/26/2013

    I just recently had to put a phone call in to my car insurance company. I’d been putting it off for months, but when I finally did it, I ended up saving about $200/year for less than 10 minutes of my time! I totally agree with you that you have to double check bills and take the time to ask questions.

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  5. Amanda

    02/26/2013

    We pay our car insurance premium 6mo at a time, and save a decent amount of money that way (~$50/6mo), plus my husband works for our car insurance company, so we receive an additional incentive. We have a multi-car policy and safe driving discounts.

    We don’t have our policies grouped because our car insurance company doesn’t do home insurance, yet no one can beat the deal that we get on car insurance (also since husband’s bonus is partially attached to customer retention, it’s an additional incentive for us to stay). We shopped around our homeowners 2 years ago. We saved almost $100 a year. We actually ended up w/ a company that a family member has – they had a major flooding event occur at their house, and the customer service they received along with the rate the company quoted us made it a no brainer to change.

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  6. Davina Sanchez

    02/26/2013

    As an insurance agent, I would rather answer 500 questions about a policy up front rather than have to explain to a client at the time of a lose why their claim is being denied. Insurance rates always fluctuate so it’s always a good idea to review your policy at least once a year. With all this being said, I have learned from experience that although you might save money, even several hundred dollars, by switching to a cut rate insurance company, it will end up costing you a lot more if you end up having a claim. Know what you are getting for your money, THAT’S THE KEY.

    [Reply]

    Chris Reply:

    This is the exact reason we changed agents (same insurance). Our agent was very put out by my asking questions. I figure if I spent two hours a year total in her office that was not very bad. My new agent is very friendly and helpful.

    [Reply]

    Andrea Reply:

    yes, definitely! If they can’t give you a few minutes of time without making your feel bad or annoying, it’s time to change!

    [Reply]

  7. Megan C.

    02/27/2013

    My husband works as a supervisor for a large auto insurance company. He would tell you to be sure to pay for a rental car on your policy. It’s usually about $3.50 a month to have rental coverage. However, many people don’t pay for it and then when their car is in the shop for 3-4 weeks getting repaired after a big hit, they oftentimes require a rental to get around and are shelling out a few hundred dollars a week. Adding rental coverage wont’ cost you very much but it will save you tons if you ever are in an accident and need a rental car! Many people don’t realize they don’t have rental on their policy until it’s too late.

    Our insurance adjustor that we used to have (in a different state), would call us about once a year and ask us to come in and review our policies. Laws changed and our needs changed as we bought a house etc. and we were able to talk over what we needed at the time. I remember at one point, we changed something that actually gave us MORE coverage and cost us LESS. Definitely a win-win. We also were able to ask any questions and just understand our coverages a lot better by having that meeting with him.

    [Reply]

    Amanda Reply:

    Ditto getting rental coverage! Well worth every penny. I had a car that got totaled, but it took a couple of weeks before the adjusters and shop agreed that it was totaled and another week before they check, etc. We’ve always paid for it, because the reality was we couldn’t function as a one car family (especially at that time with our jobs).

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  8. Kaitlin @ The Mom on Purpose

    01/29/2016

    I think your best tip here is for people to understand their policies. I can tell you how many times I’ve talked with close friends or family about insurance related topics and asked them if their insurance would cover the cost of their situation and their answers are inevitably, “I don’t know. I HOPE so.”

    I’m like you and one to call my insurance company. They are constantly telling me I can look it up online, but I’m weird and like to hear it from them and get a name of who I talked to! :)

    Thanks for sharing! These are great tips!

    [Reply]

    Andrea Reply:

    yes, and their websites are usually not very user-friendly!

    [Reply]

  9. Chris

    01/29/2016

    Another tip to consider is a discount for paying annually. We pay our homeowners’ insurance annually and our car insurance 6 months at a time and get a discount for doing so.

    [Reply]

    Chris Reply:

    I’m sorry, you had already mentioned that.

    [Reply]

    Andrea Reply:

    haha — yes, we get that discount too. In fact, when I read your first comment I thought “oh no, don’t tell me I forgot to mention that obvious discount!” Glad I didn’t forget :)

    [Reply]

  10. Lynn O.

    01/29/2016

    Yes, I have one! I signed up for the gadget with my company that I attach to the car and it monitors when I drive, how I drive and how much I drive. So far, it shows on my next renewal I will get a 12% discount if things stay the same. Not bad! But, it is about driving safe, as you have stated.

    [Reply]

  11. Christine @ The (mostly) Simple Life

    01/29/2016

    It’s been on my to do list for a while to check with other companies to see if we can save some money. I haven’t checked prices in a few years, so I really need to get on that! We got married young, and our car insurance got a ton cheaper once my husband turned 25!

    [Reply]

    Andrea Reply:

    yes, we also saved a lot after we both turned 25!

    [Reply]

  12. Jen

    01/29/2016

    We have our renter’s, vehicle (a truck and an SUV), and life insurance all through the same company and we get discounts for bundling, as you mentioned. I also called in December and asked if they’d review our policies and help me find any discounts we might be eligible for. Turns out we had far more flood coverage than we needed, so we lowered that and saved $20 per year. That seems small, but considering how inexpensive renter’s insurance is, it was a nice percentage!

    Also, they had us down as driving far more than we do because I didn’t know to update with them when I became a stay-at-home-mom in 2011, and we saved about $200 per year there.

    So basically five minutes of my time on the phone with our small, local insurance agent’s assistant gave us a spare $220 per year to pay towards my student loans or throw into our emergency savings. Totally worth it.

    [Reply]

    Andrea Reply:

    wow! I’d say $220 for 5 minutes is a pretty good return on your investment :)

    [Reply]

  13. Katy

    01/30/2016

    I think it’s always a great idea to shop around and be aware of your insurance coverage. I just wanted to add that sometimes paying a little more for insurance is worth it. My husband and I switched companies two years ago because we were unhappy with our previous agent. We didn’t save much money in the switch, but have an amazing agent now.
    We lost our home and all of our vehicles in a tornado last Spring, and I am so very thankful that we had excellent coverage and a wonderful company to deal with. It has made a difficult process a little easier.
    I totally understand that everyone has a different budget,but just wanted to share how thankful we are that we paid a little more to have such amazing insurance…when we needed it most!

    [Reply]

    Andrea Reply:

    Thanks for this tip Katy! And sorry to hear about the horrible tornado damage – that sounds awful! Glad you had a helpful insurance rep to deal with everything.

    [Reply]

  14. Rachel

    01/31/2016

    Another aspect of having a high deductible is that you won’t be tempted to call insurance for a minor situation. One great way to save on insurance is to rarely use it!

    [Reply]

  15. Mrs. M in MI

    02/02/2016

    As an insurance agent here in Michigan, here are some insider tips:

    1. Please read your policy and any correspondence from your insurance company every time, and at every renewal. Companies change their policies every year, and in Michigan they are required to note those changes in the paperwork they send you. Sometimes it makes the coverage better, sometimes it takes it away, but it’s always changing. The main changes we’re seeing right now are adding some sort of identity theft coverage (usually free, but double check!) and reducing or taking away water and sewer back-up coverage. You won’t know if you don’t read it.

    2. Do your best to keep your credit good/improve your credit and pay your bills on time. All insurance companies in Michigan, and I imagine all other states unless prohibited by law, base your premiums in part on your credit score. The difference in premium for someone with bad (or even middling) credit and someone with good credit can be thousands of dollars a year. In Michigan, the company is required to notify you in writing at renewal if they have changed your premium based on a change in your credit score, and where they got their information. They should also provide you with a phone number to call where you can find out what your score is (within a certain time period).

    3. Don’t make small claims, especially on auto. Michigan is a no-fault auto state, which means that no matter you is at fault in an accident, everyone goes to their own insurance company to pay their claim. We’re seeing that many companies are increasing your premium for making ANY claim, even if you are not at fault in an auto accident. If you’re lucky, the first claim might not count but the second one certainly will hurt a lot. Don’t make claims for small things (which I would consider anything under $1,000 on auto and under $5,000 on home); pay them out of pocket or ask your agent about making a mini tort claim if you are not at fault and you have regular, limited, or no collision. And if you are at fault and the other person wants to make a mini tort claim against you, consider paying it out of pocket.

    4. If water is coming up into your basement from the sewer drain, do not call your insurance company and tell them your basement is flooding. That is called water and sewer back-up, and it may be covered, usually by endorsement and with a special sub-limit. A flood is when a body of water is overflowing its banks, and this is never covered by a homeowners policy. (If you live in a flood plain, you have flood insurance, which is a federal program.) Don’t confuse your company!

    Sorry to write a book, but I answer these questions at least once a week!

    [Reply]

    Andrea Reply:

    Thanks so much for this in-depth comment. Your tips are great!

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