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When evaluating your financial situation, you must make sure that you can protect yourself from the unexpected by paying insurance for your assets and ensuring that the insurance policy will help you in case of an emergency. However, some people aren’t well-versed on the matter, forget to read the fine print, and pay more than they should on their insurance plans, when in reality, they could be saving more money towards other funds and expenses. In our following guide, we share 7 effective ways that can help you cut your insurance costs.
Use the same Insurer for your Car and Home Insurance
When it’s time to sign a contract with an insurer, ask whether they offer other services to ensure additional assets. Many private companies offer special discounts for customers who decide to take two or more insurances with them as a way to reward their loyalty. Providers can offer their services directly to you through their websites or via phone or can rely upon agents that act as intermediates and answer your questions and concerns about the insurance policies and conditions. Sometimes, you will be able to take additional services to obtain significant discounts on the overall package.
Take Care of your Credit Score
Insurance companies may ask for access to your credit score to determine your reliability to pay monthly and conditions the insurance’s price. Setting yourself to improve your credit score can help you cut costs when searching for auto insurance policies. Make sure to stay on top of your debts, starting with your credit card debts since their interest fees tend to be high and can easily get out of control if you don’t pay them on time.
Evaluate Switching your Car at some Point
Most people get car insurance in case they are ever involved in a road accident, however, the premium can cost significantly more based on several variables. For instance, insurers take into consideration the car’s safety record, repair costs, car’s price, and chances of suffering theft to determine the final price. Therefore, if you’re looking to buy a new or used car, researching beforehand about the cheapest cars to insure can also help you reduce your monthly fees and still receive full coverage in case of road accidents or vehicle malfunctions.
Consider Taking a Defensive Driver Course
Consult with your insurance company whether they will offer a discount on your plan if you take a defensive driver course. Some businesses offer this incentive when you sign up for an accredited course, which can also benefit you by reducing the number of points you may have on your license. However, each state will have different regulations on the matter, so make sure to consult directly with the insurer or agent to know whether any driving-related course, like accident prevention, can benefit you with a discount before signing up.
Increase Deductibles if Possible
If you feel comfortable enough to start paying less for your car insurance due to your low mileage or safe driving, you can ask to increase deductibles in your insurance plan. That way, you will pay less per month and effectively reduce spending up to 30 percent, depending on if you decide to go with a $500 deductible in some cases. This can also be done with your health insurance, depending on whether you or your family is included in its policy and what other variables are at play. However, you should only make this decision if your financial situation allows you to foot in the bill before the insurance policy covers the remaining costs.
Don’t Forget to Shop Around and Compare Prices
While you may have been with the same insurer for some time, don’t be afraid of looking around and start inquiring about other providers to know more about their policies. Prices will vary between companies, so the rule of thumb is to get at least three quotes on an insurance plan with similar coverage to have a good grasp of the value differences. You should always research the financial institution online to see whether any concerning complaints pop up from other customers, and don’t hesitate in asking friends and family for additional recommendations if you’re still unsure of where to go.
All these ways in which you can cut costs with your insurance premium can help you manage your monthly expenses while still being prepared to deal with worst-case scenarios. Keep in mind that cutting costs with your insurance premiums should be done once you’ve done proper research and your financial situation allows you to have a safety net in case you need to pay for unexpected expenses that may appear down the road.