Finances
Reducing Your Insurance Premiums
Insurance is often referred to as a grudge purchase because although most people do not want to pay for insurance, they need to in order to live a comfortable risk free life. Even though most of us need insurance we definitely do not need to overpay for it. There are four essential guidelines for keeping your insurance costs to a minimum.
No one likes shopping around for insurance. If insurance were like a pair of shoes or electronic gadget we would all spend hours if not days searching for the perfect insurance product. While it is not fun shopping around for insurance, it is essential for securing the lowest premiums and best cover. There are various options for shopping around. You can make a list of insurance companies and call each one to get a quote. This can be very time consuming and might result in you giving up and settling for one of the first few companies that you call. A better option is to use one of the many insurance comparison sites available on the internet. Most of the good ones supply instant online quotes for you to compare. The drawback of going this route is that if you are unfamiliar with insurance terminology and clauses you might end up choosing the cheapest product instead of the product that best suits your needs. If you are an insurance novice it might be better to use an insurance broker. A good broker will find quotes for you and advise you on which product best meets your risk profile. The drawback of using a broker is that they are usually affiliated to certain insurance companies and tend to be biased.
If you have money put away in a savings account, you could consider increasing your deductible. A deductible is the amount of money you need to pay for an insurance claim before your insurance company starts paying. By raising your deductible you will decrease your monthly premium. If you are able to cover the deductible from your savings instead of paying for a lower deductible, you could save a lot of money. However if you are bad at saving money then this might not be a good option for you.
By bundling multiple insurance policies into one you could save a sizeable chunk of money. This is definitely an option for people with multiple vehicles and who are home owners. Instead of having a separate policy for your car, your home and maybe your weekend warrior motorcycle, take out a policy that covers all of these items as this will bring down your premiums considerably.
Reducing your risk is a sensible way of saving money and for keeping you and your family safe. By installing a fire alarm in your house you could reduce your home insurance premium and at the same time ensure that your family is safe in case a fire breaks out in your home. Many insurers provide discounted premiums for car owners who install theft prevention devices like satellite tracking and car alarms. Speak to your insurer and find out what you can do to reduce your risk and your premiums.
Insurance Never Told Me That
Homeowners and property owners across the nation often find out nasty truths about their insurance policies after the fact. They may hear statements such as “Firearms aren’t covered,” “Any jewelry over $500 in value isn’t covered unless you purchased an endorsement,” “Water damage from natural floods isn’t covered,” “We don’t insure against sewage backflows,” and “Yes, your regular deductible is $500, but your hurricane deductible is $30,000.”
Don’t become a victim of a catastrophe and a victim of your insurance company! Finding out that your insurance policy isn’t adequate after a loss is devastating, both emotionally and financially. Most of what you need to know is written directly in your insurance policy. Unfortunately, reading insurance policies isn’t fun, nor is it easy. Your insurance policy is likely loaded with legalese and exclusions. Depending on where you live, your state may have specific requirements and restrictions, too.
So, how do you avoid “My insurance never told me that” syndrome? You’ll need to spend some time reading the policy, looking up what the terms mean, inventorying your belongings, exploring your state insurance commissioner’s site, and asking questions of your insurance company. It’s not fun, but it is informative. And, it could save you a lot of grief when a disaster heads your way.
Reading the Insurance Policy
Go through your policy and read it. What is specifically covered? What is specifically NOT covered? Write these down on a sheet of paper in columns labeled “covered” and “not covered.” For items that are covered, what are the policy’s limits? Write these down.
Pay special attention to items such as jewelry, furs, firearms, fine art, collections, electronics, and cash because these often have small limits placed on them. For example, your policy may only cover $500 worth of jewelry or $100 in cash. If you’re wearing a $24,000 diamond ring and enjoy collecting coins, you’ll need to purchase additional coverage for your jewelry, cash, and coin collections.
Look at flooding and earth movement coverage. These are most likely not included in your policy. If you live in an area (or even if you don’t) that has a history of flooding, earthquakes, landslides, volcanic eruptions, or other hazards specifically excluded by your insurance policy, you may want to consider purchasing flood, earthquake, or supplemental insurance policies.
While you’re at it, write down your deductible amounts and check to see if you have a different deductible for hurricanes, windstorms, and other catastrophes. Write these down as well so that you’re aware of these amounts. Depending on your state, these deductibles may or may not be regulated.
Make sure that your policy limits are adequate for rebuilding your home and replacing its contents. Does your policy include an inflation adjustment so that you’re covered even when building costs go up? Does your policy replace damaged items based on actual cash value or replacement cost? If your policy replaces items based on actual cash value, your damaged goods will be depreciated. While you may have paid $3,000 for your television, and while it may cost you another $3,000 to replace it, the insurance policy will depreciate it. You may only receive a few hundred dollars to replace it! Opting for replacement cost coverage ensures that you’ll have enough money to replace your items with new items.
Inventorying Your Belongings
It’s impossible to purchase the right amount of insurance if you don’t know what you have. Conduct a thorough inventory of all of your belongings and cost to replace those items with your current policy’s limits. If your house were to burn down today, turning everything inside it into ash, would you even know what to list as a loss? Take the time now to document everything and estimate its worth. You may find that your existing coverage is more than enough. But then again, you may find that it’s nowhere close to where it needs to be. By finding this out now, you can avoid the “My insurance didn’t tell me that” blues.
Insurance Resources
Your state’s insurance department website and your insurance company are excellent resources. Spend time learning about the insurance issues and regulations affecting your state and ask your insurance agent to explain anything that you don’t understand. By taking a proactive approach today, you can avoid heartache tomorrow.
Health Insurance Worth Spending Extra Money On
Life and health insurance is something that everybody needs. Life can throw many bad things your way that will require coverage. Not having it will be a big mistake for anyone.
That is why you need to understand why life insurance and health insurance is so imperative. Below are the reasons that these two types of insurance are definitely worth the money
1. Unexpected things happen – Life is full of unexpected things happening. You never know when or if something will happen to you and being prepared is essential. The life insurance will protect and help your family if something happens to you.
The health insurance will protect all of you from a lot of problems you don’t need. Don’t ever assume that nothing will happen to you because this is a big mistake. Making this mistake can cost you everything, literally.
2. Prevents financial ruin – Life insurance will prevent financial ruin for your family. The health insurance will prevent everyone from this very real problem.
You don’t want to face financial ruin at any time in your life. You most especially don’t want to cause this with your family. This insurance will protect both of you from having to deal with this.
3. Coverage for you – If you should die unexpectedly, the life insurance is going to help your family. You will use health insurance all the time for every day medical coverage.
The time that this insurance will really be worth the money is if you end up with a health condition. For example, if you are told you have cancer, without coverage, you could very easily end up broke.
With the insurance you will get the health care needed without having to go broke to achieve it. Just be sure when you purchase coverage that you get the one that is right for you.
4. Medical expenses are cheaper – There are many times that you may need medical help at some time in your life. Having coverage will make your expenses cheaper. This is something that anyone can benefit from.
Medical problems can happen at any time, so be sure you are prepared. Don’t assume you won’t ever need it because this can be very costly for you in one way or another.
Now that you can see why life and health insurance are essential, you need to both now. The sooner you have these two types of insurance, the sooner you will be prepared for anything. Don’t wait until coverage is needed because by then it will be too late to get it.