1. Think about Insurance When Shopping
When most people go shopping for something they dearly desire like a new car, house or home entertainment system they rarely stop to consider the implications of insuring their purchase.
Some items, like cars, have running costs and consumers are usually quite good when it comes to shopping for vehicles that are light on fuel, but do not stop to consider the cost of insuring the vehicles. Typically entry level and less powerful vehicles are cheaper to insure than expensive, high performance vehicles. However, this is not always the case as some cheaper models are expensive to insure due to their popularity with car thieves. Finding out how much a car will cost to insure before buying it could make you reconsider your selection and prompt you to choose a lower risk model.
Before purchasing a new home find out what the building and home contents insurance will cost. If the prospective home is in a bad neighbourhood or is vulnerable to natural disasters then the insurance quotes for that structure will be high. Getting insurance quotes for a home may even alert you to risk that you had not considered. Another factor to consider is the safety of your car at your new home. If you are torn between deciding between two houses; one with a garage on the property and one with only on-street parking then the implications on your motor insurance may persuade you to choose the property with the garage. This is because on-street parking is considered high risk by insurers and could double or even triple your current car insurance premiums.
Items like jewellery and artwork do not have running costs, but they do require insurance unless you are willing to risk losing them. The more expensive these items are the more they typically cost to insure.
Before making an expensive purchase research how much the monthly premiums will cost and then weigh up whether buying the item is still worth it. If the insurance is too high then rather look for cheaper, lower-risk items to replace them. The trick to saving money is buying items that fit your insurance budget.
2. Use an Insurance Broker
This might not seem like a crafty insurance tip, but with the dominance of direct insurance companies in the current marketplace insurance brokers have become a secret weapon for securing cheap insurance. Direct insurance has led to the decline of insurance brokers because of the perception that it is cheaper to buy insurance directly from the insurer rather than via a broker. Often this is not true.
Firstly, direct insurers have higher marketing and administrative costs as they are taking on the work themselves which brokers usually do for traditional insurance companies. So when direct insurers brag about cutting out the middleman, what they are not telling you is that this does not necessarily bring down the cost of their insurance products.
Secondly, insurance brokers are trained insurance professionals who are better equipped to identify your risks and provide you with coverage options that can reduce your risk. People who choose to go with direct insurers tend to end up either over insured or under insured because they do not know precisely what they are doing. Both scenarios result in lost money due to overpaying on premiums or getting back less than expected when claiming. Some industry figures indicate that claims that are handled by brokers are realised 40% faster than claims handled by direct insurance policy holders. Brokers also have higher success ratios with making successful claims for their clients. The real reasons why some direct insurers offer cheaper policies than traditional broker-based insurers is that they rely on their clients to make incorrect cover choices and they reject more claims than traditional insurers.
Lastly, insurance brokers can source insurance quotes for you from numerous insurance companies thus saving you time and giving you more choices. Some insurance quote comparison sites offer similar services, but a broker might have access to products that are not available on the internet.
By taking your insurance needs into consideration when shopping and by using an insurance broker you could easily save a significant amount of money on your insurance.