Insurance is tricky: policies, deductibles, premiums and rates rising and falling with the sun. Luckily, we've got a few tricks to help you better understand how to navigate the insurance buying process and several tips that could potentially save your family some extra cash on your policies next year.
If you plan to be out and about on America's roads, auto insurance coverage is a must. It's not only against the law not to own auto insurance in nearly every state, it can result in some very expensive penalties in addition to repairs on your car after an accident. While previous legislation helped to greatly reduce the number of uninsured drivers in the United States, 12.6 percent of drivers drove uninsured or underinsured in 2012, according to the Insurance Information Institute. A few things you can do to lower your family's auto insurance payments are:
- Carpool – Carpooling does more than just reduce your carbon footprint - it can also reduce your auto insurance payments. By carpooling in teams, you can cut the miles you drive in half. The miles you drive affects your insurance payments drastically, so why not kill two birds with one stone?
- Don't pay installments – If you can, paying your full premium upfront can save you from being slapped with charges per installment.
- Use what you need – When it's time for college, students going away might not need their cars until next summer. Talk to your insurance provider about activating their insurance seasonally - it will likely shave a fraction off your total.
- Don't include your land when calculating your home's worth – The land under your house isn't at risk, so don't include it's worth when deciding how much homeowners insurance coverage you'll need to buy.
- Improve your home security – You can get minor discounts (5 percent or so apiece) for having smoke detectors, burglar alarms or dead bolts. Some insurance providers often offer savings on premiums of as much as 20 percent for alarms that will automatically ring the police, and even for sophisticated sprinkler systems. Cross reference these options costs with your savings when purchasing home accessories and insurance.
- Bundle – A good way to save if you're a renter is to bundle your plan with other types of policies, like auto insurance. Going through one provider can typically help you save big in the end.
- Quit smoking – Most providers of renter's insurance offer discounted rates for nonsmokers. It's a liability to everyone around you, terrible for your health and bad for your premium - so put that butt out!
- Take a class – Some providers offer discounted rates for motorcycle insurance who have enrolled in and passed a safety training course.
- Tailor your coverage – If you only take your bike out for Sunday drives, make your coverage reflect it. Weekend coverage can be far cheaper than full-time deals.
"Two important things will save you big: raising your deductibles and maintaining a good credit score."
Across the board, two important things will save you big: raising your deductibles and maintaining a good credit score. A deductible is the amount you have to pay out of pocket toward a loss before your insurance policy starts to pay into your claim. Give a little on this front and you could save big in the long run. For homeowners in particular, if you can afford to raise your claim to $1,000, you could save as much as 25 percent from the lowest possible rates.
The main thing to keep in mind is that no matter what kind of insurance you're shopping for is to remember that price differences are incredibly common, and comparison shopping is a must.
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