Even in the worst of times, it usually does not make sense to cut back on insurance. You never know when a disaster might hit. Being properly insured can save you from disaster. When money is tight, it is better to reduce the cost of insurance rather than eliminate it. Try the following five ways to get the best insurance rates and reduce your cost.
1. Buy all of your policies in the same place
Most insurers will give you discounts when you buy multiple policies with them and may even offer bundled plans. Start by insuring your cars and your home in the same place. Then consider umbrella insurance and even life insurance, depending on the insurance company. Just make sure that you do your research, calculate the savings and not be afraid to ask for the discounts.
2. Raise your deductibles
The higher your deductibles, the lower your insurance rate. Raising your collision deductible on your auto insurance by $300 could save you up to 30 percent on your rate. Just make sure that you have an emergency find in place that can cover the increase. Otherwise you might find yourself unable to pay for your share of the repairs to your car or in the case of homeowner’s insurance, your house. On average, if you go more than three or four years without an accident or disaster striking, you will come out ahead.
3. Check the rates before you make an auto purchase
Did you know that in some cases the color of your car can make your insurance rate go up? Depending on the type of vehicle you by, think sports car versus minivan, your rate could be up to three times higher than average. Factor this cost in before you purchase your next vehicle. You can call your insurance agent to make some comparisons.
4. Ask about discounts
There are a number of discounts available that will help you get the best insurance rate, such as having working smoke detectors in your home or completing a defensive driving course. Being retired or a stay at home parent may also qualify for a discount, since with someone home all day, the insurance companies understand that the home is less likely to be burglarized or damaged by fire.
5. Improve your credit score
Get a free copy of your credit score and work to make it better. Close old accounts, eliminate mistakes, reduce your credit card debt and pay your bills on time. People with good credit scores get the best insurance rates. A few states do put limits on how rates can be affected by credit scores, but not all of them do. When you improve your credit score, ask your insurance company to reevaluate your rate.