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With costs to insure homes, businesses, cars and even medical expenses skyrocketing, it is important to have an insurance budget. You do not have to elect worse coverage in order to save money. In fact, some of the best insurance companies on the market can cover you at a low cost if you are a smart consumer.
#1 Raise your Deductible
You should first assess how much you can afford to pay out of pocket on an average claim. If you have a very high salary or a lot of accessible savings, you may be able to cover a large portion of any claim out of pocket. If this is the case, consider raising your deductible. You may actually save money paying more yourself than opting for a lower deductible and a higher premium.
#2 Opt to Leave Losses Unclaimed
Each time you file a claim, you increase your chances of a higher insurance premium. Leaving claims off of your record will save you money in the long run. Similar to paying a large deductible, pay those small claims you can afford without filing the incident with your insurance company. You may lose money initially, but you should save over time with this policy.
#3 Analyze Losses
When you make adjustments like a higher deductible or less claims, you need to see if your changes are paying off. Analyze how much you have spent covering these items yourself and compare this to what you would pay to have them covered through your insurance. Your insurance company should be able to provide you with a quote to lower your deductible, giving you a picture of what you would pay each month compared to what you are paying now. Only continue with the high deductible and lack of reporting if it is actually saving you money.
#4 Institute Loss Control Efforts
Your insurance company can provide you with some simple ways to make your home, car or business a safer place. This is called loss control. If you cannot get a good picture of loss control options from your insurer, you can use a building inspector or loss consultant for advice. A typical building inspection, for example, may cost only a few hundred dollars. The inspector can talk you through fire hazards, maintenance needs and other issues. You can ask your insurance company if there will be any reduction in premium for making the changes. If there is not a reduction, you may still elect to make the changes in order to prevent unnecessary claims in the future.
#5 Talk with a Broker
Businesses may benefit from speaking with an insurance broker. Similar to a real estate agent, a broker will actually work on your behalf to achieve better results. Brokers have a lot of knowledge of insurance; many of them have worked for insurance carriers previously. However, they have your best interest in mind. They can provide impartial advice to help you reduce your costs, and you will usually recoup the fees you pay them in savings each year.
