How to Save Money on Basic Insurance Policies

Saving money can sometimes seem a little futile. You can try all you like to save money by being frugal, cutting down on entertainment and so on, but does reducing your quality of life make up for the pennies you save? Sure, there are some habits such as going out with friends and playing video games that we could probably do without and save a lot of money in the long run. However, they are our sources of entertainment, and it’s not recommended for anyone to go a long time without having a bit of fun.

There are, however, other methods of saving money that won’t reduce your quality of life, but could give you a substantial amount of savings and offer you a little more financial freedom. Can you guess what it is? If you saw the title of this article then you’ve probably guessed it by now—the costs of insurance! Insurance is something that everyone should have. Be it for your car, your health or even your own life, having these basic insurance policies is vital to living a responsible and secure life.

But they’re, sadly, very costly to maintain. Luckily, there are many small tricks that we can all utilise in order to reduce the costs of these basic insurance policies to make them easier to swallow. So without further ado, here are some of the most common insurance policies we use and how we can cut down those exorbitant costs of maintaining them.

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Car Insurance

When we first started learning to drive, the last thing on our mind was probably the cost of insurance. Perhaps we were thinking about the cost of our car, fuel or even the cost of accessories that we wanted to add to our eventual vehicle. However, we probably had to forfeit those plans for additional accessories and modifications once we learned the costs of car insurance. Maintaining a vehicle is a lot of work that also costs a fair bit of money. However, with a little clever planning and research, we can find ways to reduce the cost of car insurance to leave our wallets a little fatter.

It’s important that you first understand what contributes to the cost of car insurance. Once you’ve learned how it is calculated, you’ll have a better understanding of why these small tricks work. First of all, car insurance is calculated by using your life and career. For instance, if you work far from your workplace and use your car on a daily basis, then the cost of your car insurance is going to be higher because you’re using the car actively on busy streets during rush hour, meaning it’s more likely that you will have an accident than someone who only drives for five minutes a day.

Your age will also come into play. For starters, if you’re a young driver, then you’re automatically assumed to have no experience which means that car insurance companies will almost always charge you extra due to your age. However, this just means that the more you drive and the more experience you have, the less you’ll need to pay for insurance.

To manipulate this, make sure that you’re following these points. First, make sure you use the right job title when you are applying for car insurance. It sounds silly, but insurers rarely check what you actually do for a living and will instead use a general assumption depending on your chosen job title. Depending on what that job entails, you could be paying a little more than you should be. For instance, music teachers are known to have higher car insurance costs than teachers because they’re more likely to carry around heavy instruments or listen to music which could distract their driving. It’s sometimes silly to make these assumptions, but that’s sadly how the industry works. Luckily, it is somewhat abusable, so if your job description falls under several categories, compare quotes and pick the one that pays the least.

Second, make sure you add another driver to the policy so that the costs come down. It’s legal to add multiple drivers onto a vehicle because sharing a car is not unusual. However, if you are going to use this tactic, then make sure the experienced driver you add has plenty of experience and a clean record. Third, try to avoid paying with installments and instead, pay all of the insurance costs up front. This is because insurance companies charge interest when you pay via installments, and while the feeling of paying more upfront might be hard to stomach, it could save you a considerable chunk of money.

Hopefully, these tips will help you cut the costs of your car insurance. Just remember to stay safe on the road and continue building up driving experience. The better your record, the less you pay for car insurance. Next, let’s talk about health insurance.

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Health Insurance

Our health is always going to be a top concern and as such, it makes sense to spend a lot of money on our health insurance to make sure we’re covered should we experience an accident or suffer from an illness. If you’re lucky enough to get free health care then this section probably won’t apply to you unless you are interested in private health insurance.

First, let’s talk about additional cover. Health insurance plans will cover a wide range of treatments and therapies, meaning that you may be paying for something that you don’t need or don’t see yourself using. For instance, there are alternative treatments such as chiropody that are included in the costs of therapies. These treatments are fairly common but also very expensive and not required by most people who are looking for the cheapest health insurance available.

Another thing to look out for, especially with private health insurance, is the list of hospitals that are included with your insurance. Some very expensive health plans include access to private hospitals or private wings for hospitals. This means you could be paying exorbitant amounts for access that you don’t need. These features are usually for the rich and wealthy who want privacy when attending a hospital, but if you’re completely fine with using the same facilities and beds as the common populace, then consider removing these options if they are enabled.

Lastly, health insurance quotes will vary greatly depending on your current state of health. For instance, smokers tend to have higher insurance costs due to their habit. They are more prone to developing illnesses and even cancer, which can be expensive to treat in most common circumstances. Not only can you save money on insurance if you stop smoking, but you can also save money on buying tobacco and you’ll be overall more healthy.

Treating your body well is the key to paying less for your health insurance. However, you also need to consider what services you’re actually paying for and if you need all of them. Make sure that you reassess your health insurance needs depending on your current situation so that you can cut costs and save money.

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Home Insurance

Finally, we’ll talk about home insurance. Home insurance is important no matter where you live. Whether you own an apartment in an urban area or a luxurious house in a suburban area with a low rate of crime and natural disasters, it’s still incredibly important to insure the belongings within your home as well as the structural integrity of it. But before we get into the list, think carefully about how you answer the questions that your insurer asks. As with every other insurance plan, you need to be truthful so that when you do need to use their services, they don’t notice something fishy. If this happens, your claim could be invalid and you might not receive any form of compensation when something does go wrong. So with that out of the way, let’s examine the ways in which you can reduce the costs of home insurance.

First of all, many insurers won’t actually approve you unless you have certified security systems installed in your home. Insurers will typically recommend you some locks or security systems to use, but for the small cost of making your home secure, your insurer will typically reduce the costs you have to pay because you already have some defensive measures against burglaries. It’s important to note if you do live in an area with a high rate of crime, this is essentially mandatory and won’t actually reduce the costs of your insurance by much if at all.

Next, it’s important to shop around for home insurance. Many people stick with their mortgage provider because it’s convenient and less hassle to setup, but it could be costing you a lot more money and with another provider, you could perhaps save a large sum of money every year. If you do choose to stick with your mortgage provider, then at least take the time to examine what exactly it is you are insuring so that you have full control of what you are paying for. In some cases, having a separate insurer for the home itself and then your belongings is cheaper than going with the same provider for both. The downside is that you have two plans to renew, but it could cut costs and make it easier to manage.

Lastly, consider occupying your home more often. If it’s unoccupied for long periods of time, your insurer will increase your insurance costs for leaving the home unattended, making it a prime target for thieves and accidents. Assuming there are people in the home (and you don’t lie about it), you’ll end up paying less for home insurance.

Jesse Fin
 

Jesse worked as a journalist for a large tv station in Korea in her past life. She now works full time at home as a blogger and loves to help her friends manage their personal budgets.

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