I have a way for you to save money on something you are already purchasing. This expense might be costing you thousands of dollars per year, so the savings could really add up. It’s not your phone bill or utilities. It’s not even cable. What is it? It’s your insurance premiums.
Insurance, like many other services you use, likely renews itself on a continual basis, either monthly or annually, Instinctively, you would think that being a loyal customer and having a good payment history would lead to you having the best rates. Unfortunately, this is not often the case. In fact, many times, your loyalty works against you. Oftentimes, your bill will slowly creep upward and cost you more than what is being charged to new customers. New customers get the deals and existing customers, like you, are the ones paying for their
I have witnessed this phenomenon with my insurance payments. When I have comparison shopped in the past, I have consistently found lower prices with other providers in the marketplace. Because of this, I have compared rates every couple of years, and I have consistently lowered my premiums. I thought this was often enough to compare, but what I discovered recently shocked me since I had just switched 12 months earlier.
Compare, Switch, & Save
Last summer, I switched my auto insurance companies. Holding the same coverage limits, I decreased my premiums by 20%. The insurance was with a well-known national carrier and I had a local person to contact, as necessary. At the same time, I changed my homeowner’s insurance policy. On this policy, I also lowered my premium by 20%*.
Overall, I felt good about the new companies and coverage. I was quite satisfied with the switch. Between the two changes, I saved well over a thousand dollars in premium payments.
*Note: When I switched my homeowner’s insurance, I initially “switched” to a different policy # under the same carrier. The new policy was cheaper than my old rate. Great, I thought. Then, I received an addendum when they realized I was not a new customer. The addendum asked me to pay an additional $100. So, I ended up switching again. Luckily, I found an even lower rate.
Over the next 6 months, I pared an additional 25%+ off of my premium costs utilizing the online portal and adjusting my coverage options. I have 5 drivers in my household. With 3 young drivers, I have several older cars and multiple driving demerits on our policy. By dropping some options and reducing coverage, I achieved lower rates for two reasons. First, dropping deductibles from $500 to $1000 is cheaper. Second, the changes allowed my premium to be re-priced with my provider, which allowed some of those demerits to age and expire from my family’s driving record.
How Often is Too Often?
After a year, I was still feeling good about my insurance policies and rates. I had just received a notification that my new policy period would begin in the next 30 days. Initially, I planned to just let them renew. Fortunately, I surreptitiously ended up running into someone who wanted to review my rates. I said sure and gave them my information. When they came back with the new rates, I was shocked.
Homeowner’s Coverage
First, on my home policy, the review prompted me to check the policy with my current provider. To my surprise, the policy for the coming year was going to be going up by 10%, even without any claims taking place. The new bid I received lowered my old rate by 10%. By switching, I avoided the 10% rate hike plus I took advantage of the new 10% reduction. Overall, I saved 20% premium for the same coverage and a clean claim record.
Auto Coverage
Next, I evaluated my auto insurance rates. I was sure the rates I locked in one year ago and whittled down since then were going to be hard to beat. I was wrong. For the same deductibles and coverage, the new quote was 25% less and it was provided from a very reputable carrier. Overall, from switching twice in the past 12 months, I was able to save over 55% on my auto insurance bill.
55%: Amount I saved by switching insurance policies
You Better Shop Around
I am not saying you are going to save these same dramatic amounts. Your results will depend on what you are insuring, coverage rates, etc. You are likely to find savings over your current payments. Shopping around sounds painful but it really does not have to be so. You can start the process on-line. Input your current coverage into several different carriers and compare the results. Here is a site with links to multiple insurers from my friends over at NerdWallet.
I have been surprised by my conversations on this topic. Most people I have talked to about their insurance have had the same agent and/or carrier for years. They have not compared rates in the past couple of years. When I mention how I have been able to save money, they pledge to go home and do some comparison shopping. I hope they do and I hope you will too. I think everyone can save money, even if they go back to their current provider with a request to re-price their current policy.
Once you find out if you can save money by switching, you will just a couple of steps away from making it happen. I did and I was able to save thousands of dollars per year. Just think about what you can do with that additional money