Looking to save a bit (or a bunch) on your home and auto insurance? These 10 quick tips could do just that!
Near the end of every calendar year, I take a few minutes (literally minutes) to look over our home and auto insurance policies as they both come due in December.
After I review our policies, I usually make a quick call to our insurance agency — sometimes just for clarification about something I don’t understand, and sometimes to verify that we are still getting the best price for the best coverage for our current stage of life.
Almost every time I hang up, I’ve saved money… and this year was no exception!
After a 15 minute phone conversation, I was able to lower our annual home insurance premiums by almost $80 AND we ended up with more coverage for things that matter most to us right now!
Not too shabby. 😉
Disclaimer: I’m not a professional — you know that! But, I do have almost 20 years of experience with our own home and auto insurance (as well as lots of experience living super frugally!)
If insurance jargon and paperwork feel intimidating or overwhelming, or you’re just not sure where to start, give these quick tips a try (start with 1 for now) and see if they save you a bit of cash!
1. Know Your Policy
You don’t need to “understand” every detail of your policy, but at least be familiar with your bill, with your online account, with how much you pay, when you pay it, and (generally) what you pay for.
The more you know your current policy, the quicker and easier you’ll be able to spot if your rates suddenly increase, or if something changes unexpectedly.
For example, a few years back, I reached out to our insurance company after our auto insurance bill jumped quite a bit. It turned out the computer system had accidentally changed our policy to a more expensive plan — with one quick call, I saved about $250 every 6 months!
2. Stay in Contact with Your Agent
I don’t recommend contacting them more than necessary, but a yearly phone call to ask a few questions and double-check your policy sure can’t hurt.
As long as you are polite, you shouldn’t be concerned with inconveniencing them — this is their job. They are there to serve you, and you’re paying them to do so!
My most recent conversation ended up with a recipe exchange as we were both roasting a chicken for dinner and she gave me the “cheesy rice recipe” that she always made with roasted chicken.
3. Ask for a Discount
This might sound like you’re being a bit “forward”, but I prefer “assertive”!
Don’t feel bashful, ask them if you have all the discounts available for your policy.
Our company recently changed how they handle online bill-pay, so in addition to getting a discount for paying in full each year, we now also qualified for an auto-pay discount AND a paperless statement discount.
These last 2 discounts were brand new and I wouldn’t have known about them unless I asked.
4. Bundle Your Insurance
We get a great discount for using the same company for both our home and auto insurance — and it’s more convenient because we only need to work with one company.
5. Increase Your Deductible
Our policies automatically came with a $500 deductible — meaning, if you make a claim, you’d be responsible to pay the first $500 out of pocket before insurance money would kick in. There are also $0 deductible policies.
We requested to change our policy to a $1000 deductible, meaning, we are now responsible to pay the first $1000 of any claim — but our yearly premiums went down $350 per year over a $0 deductible policy.
Note: if you do a little mental math, we’d save more than $1000 after just 3 years on a $1000 deductible policy, so in the long-run, we’re already way ahead.
6. Make Fewer Claims
Since we have a $1000 deductible, we definitely think twice before making any small insurance claims.
The claim would need to be well over $1000 for it to be worth to involve insurance… and the less we use our insurance, the deeper our premiums are discounted.
We now get a yearly percentage discount for every year with go without making a claim, and that adds up after several years without a claim.
7. Stay Safe
When it comes to auto insurance, you can save a bunch by driving safely, not getting any tickets, and not getting in any accidents.
Also, I get a discount on my car insurance since I work from home, and Dave’s policy went down when he changed jobs to a closer school (so if you don’t drive a lot, make sure your company knows that).
And… did you know you can likely save some on your home insurance by being “safe” too?
Your premiums can go down if you have a fenced-in yard, deadbolts on all your doors, and smoke detectors in all your bedrooms.
8. Keep Asking Questions
I honestly can’t emphasis this enough — just be willing to ask questions and keep asking them.
We recently saved $75 because the company changed their policy on trampolines (they no longer charge extra for homes with trampolines) but I didn’t realize this until I asked.
I’m not even going to try to list all the questions you could ask — but before you call, do a quick Google Search for: “The best questions to ask my __________ Insurance Agent” and you’ll find lots of great ideas.
9. Consider Changing Companies
Dave and I are pretty loyal people who prefer to stick with the same companies, organizations, churches, schools, etc. for the long haul.
Plus, it can be a big pain to switch companies, and often it’s not worth the hassle — so this might be a “last resort”.
However, if you don’t feel great about your current insurance company, I’m confident there are plenty of other companies who would love your business.
Do a little research, ask lots of questions, and see if you can find a company that’s a better fit for your current needs (preferably with a lower rate!)
10. Get Organized
This sort of ties in with #1 above (knowing your policy) but it’s more than that too.
Keep your paperwork (or your emails) in one spot so you can quickly and easily access them if necessary. Know your policy number and who to contact if you have a question. Keep your login information and passwords easily available (and with your other insurance information) in case you or someone else needs to access your account.
Several years ago, I created a “Family Emergency Binder” to store and organize all kinds of important information for our family, our home, our cars, our finances, our jobs, our retirement accounts, etc. and it has been such a huge peace of mind for me, just knowing that information is in one place and easily accessible.
Although I originally thought the binder would only be used in the event of an emergency, I personally use it very regularly for everyday issues or questions (like when I need to call my insurance company about an increase in our bill).
If you’d like to create a binder like mine, I walk you step-by-step through that process in this post.
I know there are many more tips to save on insurance… so I’d love to hear from you.
Kim says
We had been with an online insurance company for decades. It was competitive with 3 teenage drivers on the policy. I began to notice the premium kept creeping up every 6 months. I’d call and we had all the discounts. This year I decided to go back to a local agent to have everything quoted. She was able to save us over $300 a year!! I also love that all our policies have an annual renewal date. One thing to keep in mind is one policy may be a bit more expensive while another may be quite a bit less. That’s what happened in our case, saving us more over all. I love that she is local and we had nice conversations during the quoting process.
Andrea says
wow — that’s fantastic! Every little bit of savings adds up, but it’s so satisfying when one phone call can save $300 bucks right away!
Kaylie says
Excellent tips! My husband is an insurance agent and I also work in his office. We always want people to feel good about their coverage and understand what it means and why they have it. I have realized that most people have no clue about their insurance and it’s SO important to be educated and understand how you are protecting all of your important assets!
Make sure you are comfortable with your insurance office. They could end up being your best friend on your worst day.
Andrea says
Thanks for this Kaylie! Glad to know my tips seem to be in-line with your opinions too!
Nancy says
We had a plumber working on our new kitchen who also does fire, water damage restoration. He said to make a video and say “Pottery Barn shower curtain cost 60$”, “expresso machine brand blah blah 1000$”, for example. Open your kitchen drawers and all that. Otherwise you try to list your belongings and won’t remember half of it and the insurance company will reimburse you for a Dollar tree shower curtain and the cheapest coffee pot made.
My concern is I get everything at estate sales and thrift stores. Do I be honest and say this 200$ Cuisinart airfryer cost me 50$?? I can’t replace it for 50$. I guess look up market value. Have I done this? Not yet.
Andrea says
Yes Nancy, I’ve been told the same thing — to go through every room, closet, drawer, etc. and list out what you have. BUT, I also have the same “problem” as you — that I get everything used for pennies on the dollar.
Our insurance company said to list the actual price of the item b/c if you ever needed to replace it, the insurance company would only pay for it if you buy it new (they will not reimburse thrift store or 2nd hand purchases). So… if our house ever burns down, I’m headed to Pottery Barn and buying all the full-price stuff — LOL!
I also haven’t actually done it — but I have gone through and snapped pictures of each of our closets and drawers so I remember what’s inside (maybe not the actual price, but what needs to be replaced).
Sarah says
Fab post Andrea- would love to hear more about your ‘new to you’ minivan e.g. features and storage, your organisation inside, how it works with 3 kids etc. We have 3 boys and have been looking at that exact same model but haven’t quite made up our mind so would be wonderful to read a ‘review’ by a fellow mum
Mrs. M in MI says
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!
Andrea says
Thanks so much for this in-depth comment. Your tips are great!
Rachel says
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!
Katy says
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!
Andrea says
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.
Jen says
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.
Andrea says
wow! I’d say $220 for 5 minutes is a pretty good return on your investment 🙂
Christine @ The (mostly) Simple Life says
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!
Andrea says
yes, we also saved a lot after we both turned 25!
Lynn O. says
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.
Chris says
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.
Chris says
I’m sorry, you had already mentioned that.
Andrea says
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 🙂
Kaitlin @ The Mom on Purpose says
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!
Andrea says
yes, and their websites are usually not very user-friendly!
Megan C. says
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.
Amanda says
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).
Davina Sanchez says
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.
Chris says
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.
Andrea says
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!
Amanda says
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.
Courtney says
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.
chris says
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.
Carlen says
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.
Deb says
#1 way to save, don’t have teenage drivers! 😉 TEE HEE HEE
Kim says
Make them pay for their own insurance, that will teach them responsibility.
Amanda says
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!
Meilssa says
Some insurance companies give teen drivers discounted rates for being on the Honor Roll.
Kimberly says
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!!