Finding an insurance plan tailored to your unique needs can be challenging, whether you’re shopping for your first policy, transitioning out of a parent’s plan or switching providers. With some simple questions in mind, though, finding your ideal policy should not be hard at all!
Strive for a balance between premium savings and adequate coverage – too little insurance is just as harmful as too much.
Ask for Discounts
If you’re purchasing insurance for the first time or renewing an existing policy, be sure to ask your agent about any discounts they might provide. Insurers often automatically sign you up for certain discounts such as paid-in-full discount and electronic payment discount to reduce administrative costs; and are happy to pass those savings along to their customers.
Other common discounts include being a safe driver or holding multiple policies with one company, which typically increase as you keep your driving record clean and the longer that goes by accident-free. Furthermore, insurers may offer further savings by monitoring your driving habits using a device connected directly to your car; be sure to understand how the information collected by this device will be used before signing up. Ask your agent if there are additional discount opportunities or smart policy restructuring strategies they can suggest that can lower premium costs further.
Review Your Coverage Needs
Engaging in an annual insurance review is a smart move. An insurance expert can help review all of your existing policies to make sure they meet your coverage needs – particularly after major life events like marriage, divorce, the birth of a child or buying a home.
Now is also an ideal opportunity to examine whether bundling your policies or taking advantage of discounts such as safe driver or multi-policy could save money on premiums, as well as ensure any personal information on your policy is current.
As part of an insurance review, it’s advisable to compile a list of your current policies as well as their details and the associated details for each. Your financial statements may also prove useful. Depending on your unique situation and goals for your family, other aspects may also come into play such as debt levels or expenses.
Reviews of life insurance coverage should be undertaken annually in order to make sure it aligns with your plans for the future and provides sufficient protection. In addition, this gives an excellent opportunity to review beneficiary designations to make sure they reflect your current wishes.
Don’t Shop by Price
As insurance is not a commodity, shopping solely on price can be misleading. Different insurers offer policies with unique features and discounts as well as claims handling practices – thus providing an opportunity to make an informed decision when purchasing insurance policies. Comparing quotes and policy details will enable you to make a smart purchase decision.
Be sure to review and shop around periodically, particularly when renewing a policy. Some insurers use “price optimization,” wherein rates increase for long-term customers assuming they will not shop around as frequently. This could be an expensive mistake; shopping ensures you are not paying too much and is an invaluable way to save.
Make a Plan for Emergency Savings
Financial experts generally suggest having three to six months’ of expenses saved up in an emergency fund as a general guideline. Of course, this amount may change based on lifestyle factors such as budgeting and income; saving is about making this goal possible! So take time now to start saving what you can.
Start saving for emergencies today by setting aside part of each paycheck or by investing any windfalls like tax refunds, gifts or bonuses into it. Consider banking services with mobile apps or online features that allow easy money transfers between accounts.
Make a spending plan and stick to it in order to protect the balance from being depleted due to impulse buys. This can help ensure that any surplus funds don’t end up going towards unnecessary purchases.
Calculating how much to save requires adding up all your monthly living costs and bills, subtracting non-essential purchases like lattes or lunches out, then setting an emergency savings goal based on that calculation each month and taking small steps every week towards reaching it. Doing this will allow you to be financially prepared in case an unexpected expense or family emergency arises without needing to sell off long-term investments at fire sale prices.
