Let’s run through seven simple, cost effective tips and tricks to getting more value from your insurance plan!
- BUNDLE your policies with one company
I hope that the insurance commercials have convinced everyone that putting all of your personal policies with one insurance company is beneficial; however, we still see many people that are reluctant to do it for one reason or another. 99% of the time you will save money on your costs if you package the policies with one company (be sure to look at the total plan’s price – not just the price of one policy!). Furthermore, and just as important, it provides your agent with more leverage if you ever have a claim or renewal issue when an underwriter may be considering non-renewing a policy or rating the policy in a different tier.
- Inform your agent of any utility and (especially) roof updates!
This one is easy – let your agent know if you’ve gotten a new roof, purchased a new furnace/air conditioner, or updated your electrical panel (more applicable to older homes). Many companies offer discounts if you’ve updated these items and all companies have now started rating for the age of your roof. So, it’s very important – and very easy – to make sure the age of the roof is correct on your insurance policy, especially if you’ve replaced your roof in the last few years!
- Lower your comprehensive deductible.
Yes, you read that right, lower your comprehensive deductible. But, won’t my price go up!? Yes; however, it’ll go up minimally. Furthermore, most comprehensive claims (animal hit, glass damage, hail damage, vandalism, etc.) are much smaller than if you’re involved in an accident with another vehicle (which is then a collision claim). They are also much more common – which means if you want to keep filing claims, you’ll need to keep paying your deductible! Unless you want to self-insure any damage to your vehicle (and at that point, remove all physical damage coverage from your policy) – it makes sense to lower your comprehensive deductible.
- Increase your liability limits! PS – buy an umbrella policy!
Wait, won’t this also increase the cost of my insurance!? Yes. But it will provide you with additional value and coverage at an exponential rate vs. the cost. The cost of insurance may increase a few percentage points, but you can increase your protection by a multiple of 2-3 times. Most people think they’ll never need that much liability protection; however, if you have to carry insurance (and you do in the state of Wisconsin) – you might as well purchase enough to protect you, your family, and your assets in case you ever do hurt someone or damage their property. And, if you really want peace of mind – for less than $10/month (or less than 3 cups of coffee at Starbucks) – you can purchase an umbrella policy!
- Additional Expense/Rental Car
If you are in a household where there are as many drivers as there are vehicles – it’s essential that you have additional expense/rental car coverage. Contrary to what most people think, this coverage does not provide protection if you go on vacation and rent a vehicle (that coverage is extended elsewhere in most insurance contracts). This coverage covers the additional cost of rental/loaner vehicle that you may need while your car is being repaired after being in a covered insurance claim. For example, I hit a deer and file a claim with my insurance company. I bring my vehicle to the body shop and they tell me they are backed up and it’ll be 2 weeks before my car will be repaired, but they will give me a loaner while my vehicle is being repaired. You’ll be on the hook for this cost (usually about $30-$35 per day!) unless you have additional expense/rental car coverage on your policy!
- Pay the premium in full, if possible!
Many companies are offering SUBSTANTIAL discounts if you pay the insurance premium in full. We have companies that are offering up to 11-12% discount for paying the premium in full. That is a considerable savings off any expense – especially insurance expenses. It’s always painful to pay the full amount at once, but if the company is offering a meaningful discount to do so – it often makes sense.
Yes, I think everyone needs life insurance and that it is an important part of any comprehensive and inclusive risk management program. No, I don’t think the policy that your employer is providing is sufficient protection (topic for another day). I do believe that TERM life insurance is the best option for most individuals. Term life insurance is the most cost effective life insurance option and is the easiest to understand (pays a death benefit if the insured dies during the term of the policy). Whole life insurance and universal life insurance policies both have their place in some risk management programs and may be the best option for some; however, for most people – term life insurance is the way to go. But, Chris – my whole/universal life insurance policy builds cash value! Yes – but it’s often at a minimal rate of return. What we recommend doing is taking the cost difference between term and the other options and investing it with a professional – like Fox River Capital – that are experts at maximizing your rate of return.