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How To Lower Your Insurance Cost

Updated on March 27, 2010

Saving On Insurance

Few people can go through life without needing to buy some form of insurance. Many actually end up with a variety of policies in place. You may, for example, find that you need permanent policies to cover your life, car, home and possessions. You may also opt to take out health and income protection and even travel insurance when you take a holiday. Buying policies may be essential but nobody wants to pay more than they need to. How can consumers save money on their insurance costs?

There are five quick and easy ways to cut the costs of insurance:

Knowing Exactly What You Need

 

1. Work out what features and benefits are necessary: Although insurance policies may have the same general aim, this doesn’t mean that they all offer the same features and benefits. It is quite common for consumers to opt to get as much protection for as many different issues as they can when they apply for a policy. This may, however, see them paying for benefits for which they will never need to make a claim. This could simply waste their money. Taking time to understand what needs to be covered in a policy may result in more cost effective premiums.

 

2. Make sure not to over-insure: Insurance policy costs will rise according to how much cover you take out. The higher the insured sum, the more you are likely to have to pay. It’s common for consumers to opt for higher levels of cover to get the best protection. But, it may be more cost-effective to work out what is actually necessary here and to buy a policy on that basis. This could significantly lower your premium costs whilst still giving adequate cover.

Using The Same Insurance Agent

3. Consider the excess: Insurance policies generally come with an excess built into them. This represents the sum of money that the policy holder will have to pay in the event of a claim before the insurance company takes over. If you increase your excess sum then your policy costs may well go down. This gives the insurance company the benefit of potentially having to pay out less money so they may then charge a lower premium.

4. Buy from the same insurance company: Many insurers will offer a range of policies. Taking out more than one type of insurance from the same provider may see the consumer given discounts or lower premium costs. So, buying car and travel insurance from your home insurance provider may result in savings on all of your premium costs.

Shop And Compare

5. Shop around and look online: Consumers can often compare two like-for-like policies from two different insurance companies and find no real difference in their benefits and terms. The only difference here may well be in the premium cost. Shopping around to find the lowest premiums could well cut the costs of any policy. This can be easily done online by using an insurance comparison site or a broker. Bear in mind that taking out an insurance policy online may also qualify you for an Internet discount into the bargain.

Although saving money on an insurance policy is a good thing to do, the consumer should take care to make sure that this doesn’t come at a cost. It is advisable to make sure that the right levels of cover are put into place before looking for ways to save money. Cutting costs at the expense of getting good coverage may well turn out to be more expensive in the long run if the policy holder is under-insured or fails to take out the right features and benefits.

Comments

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  • speedbird profile image

    speedbird 7 years ago from Nairobi, Kenya

    Thanks for sharing the insightful tips on how to save on insurance. Voted up and rated USEFUL

  • adrienne2 profile image
    Author

    Adrienne F Manson 8 years ago from Atlanta

    Thanks thevoice, Sandyspider!

  • Sandyspider profile image

    Sandy Mertens 8 years ago from Wisconsin, USA

    This is something we all need. Well done.

  • thevoice profile image

    thevoice 8 years ago from carthage ill

    well done write thanks

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