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November 28, 2008

Thrifty Living Times

We All Pay for Insurance, but How Much We Pay Depends on a How Many Discounts We Receive

Homeowner's Insurance Money-Saving Tips:

Raise your deductible. If you're willing to cover more loss, the cost of your insurance premium will go down. For example, if you raise your deductible from $250 to $1000, you could save between 10% and 30% on your premium for not a lot of additional risk.

Ask about non-smoking discounts. Many insurance companies offer discounts for non-smokers, but sometimes you have to ask to get the discount.

Get your auto insurance and homeowners' insurance from the same company. You might get multi-line discounts which can be substantial.

Insure only the house and not the property. If there is a fire, only the house burns, not the land, so don't pay to cover the lot the house sits on.

If you are of a certain age, ask about senior discounts.

Tell your insurance agent if your house is near a fire hydrant. Some companies give discounts for this.

Ask about getting discounts for security systems, fire alarms, and fire sprinkler systems. Most companies will provide savings for these devices so it can pay to install them.

Automobile Insurance Money-Saving Tips:

If you have towing and roadside assistance through your vehicle warranty, why also buy it through your insurance? If you do not have roadside assistance through your vehicle warranty but have it though an auto club membership, it may be less expensive to carry it through your insurance policy than pay for the auto club membership (although you many want to keep the auto club membership if you use it for hotel discounts and travel reservations, etc.).

And if you have separate medical insurance, consider dropping your policy’s medical payments coverage, unless your state requires you to have that coverage.

Some insurance companies will give you an occupational discount depending on your educational background and job title. Teachers, medical professionals, scientists, engineers, computer professionals, and other jobs that require a college degree, license, or certification may receive a discount.

An anti-theft discount can lower the comprehensive (theft & vandalism) portion of the policy premium. This is generally considered to be a Global Positioning Satellite (GPS) based system where your car can be located via a satellite if it is stolen.

Some companies offer a 2% to 15% discount to active and retired members of the military.

Life Insurance Money-Saving Tips:

Premiums have dropped dramatically in the last 10 years, and it may be worth replacing a life policy bought years ago with a new, comparable one. For example, a $500,000, 20-year guaranteed level term policy from Prudential would have cost a healthy, nonsmoking, 50-year-old man about $2,125 a year in 1998. Today that policy would probably cost about $1,385 a year for the same coverage over the next 10 years. This is a savings of $740 per year.

And if you adopt a healthier lifestyle, you can get re-rated and get a lower rate. For example, a 40-year-old man with a $1 million, 20-year term policy could save $50 a month by cutting his cholesterol by 30 points; $65 a month if he dropped 50 pounds to reach normal weight; and $165 a month three years after he quit smoking. But don't cancel your existing policy until you have a new one already in place!

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