A better way to save on insuring your home is to raise your deductible.
An increase from $500 to $1,000 could save up to 25 percent on your premium payments. Most people make the common mistake of insuring a home for its real estate value rather than for the cost of rebuilding. When real estate prices go down, some homeowners may think they can reduce the amount of insurance on their home. But insurance is designed to cover the cost of rebuilding, not the sales price of the home. You should make sure that you have enough coverage to completely rebuild your home and replace your belongings.
A better way to save when shopping for an insurance company is to check the financial health of a company with independent rating agencies as well as asking friends and family for recommendations.
You should select an insurance company that will respond to your needs and handle claims fairly and efficiently. A very common mistake is to select an insurance company by price alone. It’s important to choose a company with competitive prices, but also one that is financially sound and provides good customer service.
A better way to save is to consider purchasing flood insurance, for damage from flooding is not covered under standard homeowners and renters insurance policies.
Many homeowners are unaware they are at risk for flooding, but in fact 25 percent of all flood losses occur in low risk areas. Furthermore with the significant snow fall this winter, spring related flooding may be particularly severe, thus increasing the importance of purchasing flood insurance. If you are in a designated flood zone, look at mitigation efforts that can reduce your risk of flood damage. Additional information on flood insurance can be found at www.FloodSmart.gov. Coverage is available from the National Flood Insurance Program (NFIP), as well as from some private insurance companies.
A better way to save on your auto insurance is to consider dropping collision and/or comprehensive coverage on older cars worth less than $1,000.
The insurance industry and consumer groups generally recommend a minimum of $100,000 of bodily injury protection per person and $300,000 per accident. Don’t make the common mistake of only purchasing the legally required amount of liability for your car. In today’s litigious society, buying only the minimum amount of liability means you are likely to pay more out-of-pocket if you are sued—and those costs may be steep.
A better way to save is to look into multi-policy discounts, which includes renters insurance if you do not own a home.
Buying several policies with the same insurer, such as renters, auto and life will generally provide savings. Do not neglect to buy renters insurance for it will cover your possessions and additional living expenses if you have to move out due to an insured disaster, such as a fire or hurricane. Equally important, it provides liability protection in the event someone is injured in your home and decides to sue.