Take Back Your Finances #42: How To Shop Around For Insurance and Why It’s Important To Do This Every Year

Would you like to learn a tip and steps to potentially save an easy $100 per month? Well, that is what we are sharing with you this week!

We are now up to week #42. It’s been a fabulous 42 weeks so far and so many positive financial changes have taken place in each of our lives. It’s only going to propel into more success in the future as we all work at being better stewards of our finances.

Well, since we only have 10-weeks left, we still have a few things to cover. The next one is an annual insurance review.

We actually shop around for insurance each and every year. It is a competitive field and the rates are competitive too. Now, although we “shop around” by having new rate quotes, it doesn’t automatically mean we switch every year either. We’ve actually been with the same agent and company for the past few years. It’s still just been the best option.

Before we dive into how we want to share why. 

Why should you shop around for new insurance rates each year? Well, the short answer is that you can find some radical savings! This is one area that rates and promotions change so often that you can save quite a bundle each and every year and continue to get the best possible rates. We have switched insurances nearly every year until the past few years. So perhaps there is a point where you reach a “rock bottom” insurance rate. And although we have been here for a few years, we will still shop around each year to see and see if we can get better deals, better coverage, better services, and more for one low price.

Other reasons you should shop around include a change in your family situation (e.g., change in age of drivers, change in requirements on what or who you need to insure) can result in some great savings; even if you stay with the same insurance carrier you can still talk to your current agent to see if those make you eligible for further discounts.  Plus don’t forget that you are making some major changes in your finances – even these last 42 weeks.  Changes in your debt load and other financial risks (to their company) can be a benefit to help you get a lower insurance rate.  And finally, changes in your driving record (tickets dropping off your record, etc) can help you get a better rate as well.  As you can see there are a multitude of reasons to do this annual check every year.

The insurance savings alone each year as made up quite a chunk of our annual savings. Often times, you can save hundreds per year – sometimes up into well over $1,000 when you bundle all of your needed coverages into one policy! We do and are with one of the top “non-discounted” insurance companies that offer exceptional service and response and save big. Could you imagine saving so much that you had an extra $100 per month? That is a huge savings! Do you know the lengths, time invested and effort people put into saving an extra $100 per month? We can tell you from experience, a HUGE amount. But this is one trick that can save you that much nearly effortlessly in comparison.

It only requires a big of initial leg work and a few hours of research and then an hour or so of set-up on a new insurance. But if you are saving $30, $50, $100+ per month – that is more than worth the effort!

This article from Today.com shares a little more insight into why you would want to shop around each and every year.

How To Shop Around

You can shop around a couple of different ways. We would recommend both to give you a very good idea of what is available.

1. Look online
Begin your insurance quote quest online, but do not stop here. We never recommend signing up for insurance strictly online. Why? Because a lot of caveats, misunderstanding of coverage, unanswered questions (or at least the answers being buried in lots of fine print) and more can become a real burden if you ever need to cash in on a policy. However, starting online gives you some ideas.  We recommend using NetQuote.com or InsuranceQuotes.com.

Also, you will want to refer to the National Association of Insurance Commissioners and look up your state for state specific information and tips. This is a GREAT resource!

2. Call around
You can call local agents from price you saw online in your quote search, look up top insurance agencies in your area, ask around to your friends on Facebook, etc. Find several agents that will write up quotes for you and compare.

3. Ask the RIGHT questions
After these two steps, there is a third CRITICAL step. That is asking the RIGHT questions to make sure that the coverage you have vs. the new prices you are looking at will be of the same value.

You need to know what you currently have and based on that, what you are looking for – this or better?

Here’s the questions to ask on a homeowners policy:

• Is this replacement cost or cash value policy? (hint: you want replacement)
• What all does this policy cover? Does it include water and flood? Earthquake or other natural disasters? (hint: you might not need to pay the extra high price of natural disasters and it usually adds a huge cost to your insurance as FEMA will often help in this case)
• What is not covered?
• What situations am I not protected in under this policy?
• What are my discounts?
• What is the deductible? (hint: this too plays a great role in how much your policy ends up costing)

And here’s some questions for auto coverage:

• Will my liability limit protect my personal assets if I am liable for a major accident?
• What is the medical coverage in case of accident?
• If my car is a total loss, how will the insurer value my car?
• Does my policy cover uninsured?
• What kind of coverage is included when I rent a vehicle?
• Can I select the auto body repair shop of my choice?
• Does it include a rental replacement if my vehicle is inoperable?

Also, we recommend checking out a few previous articles on insurance and savings:

• 10 Ways To Save Big On Homeowners and Auto Insurance Premiums

• How We Pay $64 a Month For Auto Insurance on Two Vehicles

Need to catch up?  Come join us on this challenge from the very beginning by clicking on the 52-Week Take Back Your Finances Challenge and sign up to start receiving your automated challenge from the very beginning!

One final thing…we also have a Facebook Group where you can engage in discussions, receive encouragement and talk to others that are participating in the challenges too for more ideas! Head to the Be Intentional with The Thrifty Couple Facebook Page HERE and ask to join us there! You can also invite friends and spouses too!

Disclaimer: We are not licensed financial planners. We are only a couple that have been just a hair-breadth away from bankruptcy and found our way out of debt with a goal to now help others. Please make sure to consider any advice given on our site and in this challenge as tips we have used ourselves; they may not work for everyone. If you have questions please make sure to contact a licensed professional.

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