Cut Your Insurance Costs

By Kristi Vaughan

There are some things about life that you can't change. High insurance premiums shouldn't be one of them. With a few alterations in lifestyle or preferences, you can make significant cuts in your insurance bills.

Auto insurance

Anyone who drives should have auto insurance. In fact it's often required as a condition of motor vehicle registration. Frequently you can save money by shopping around and getting rates from different companies. But so too are there changes you can make that bring savings even if you don't change insurance companies.

• Deductible. The deductible amount listed on the collision and comprehensive portions of your policy is a number that you, not the insurance company, control. Since a higher deductible means the insurance company has less to pay out, you'll get a lower rate if you raise your deductible. How high the deductible should be depends in large part on how much you are willing to spend out of your own pocket should your car be damaged. Check with your carrier to see how much the premium would decline for each $250 jump in your deductible.
• Good student discount. If you are in school, or you're paying insurance for someone who is, ask your insurance carrier if they offer a good student discount. Many carriers reduce rates for students with a "B" or better average. They will ask for proof of the grades and you will need to send new proof whenever the policy is renewed. And hey, if your grade point average isn't quite at the "B" level, maybe this is incentive to study harder!
• Safety features. If you are buying a new or used car it can pay to get one with the latest safety features. Air bags, over the shoulder seat belts and anti-lock brakes are all features that can earn discounts from some insurers. So too can anti-theft devices.
• Safety ratings. Insurance rates are based on risk evaluations. The higher the risk, the higher the rate. Groups such as the Insurance Institute for Highway Safety and the Highway Loss Data Institute take regular looks at automobile safety and publish ratings based on their findings. A safer car, or one that is less likely to get stolen, will probably earn you a lower rate.

Homeowners insurance

If you own a home you probably have homeowners' insurance. In fact, if you took out a mortgage, the bank probably required it. The Insurance Information Institute offers these and other ways to save on your homeowners insurance.

• Safety features. Smoke detectors and carbon monoxide detectors are among the safety features you can add to your house to help decrease the likelihood of an insurance claim. Check with your insurance carrier to see if you'd get a bigger discount if these detectors were tied into an outside alarm system.
• Security features. Ask your insurance carrier about discounts available on safety features such as deadbolt locks and alarm systems. And find out if there is a difference in rates if the alarm system is simply audible or tied into an outside security-monitoring firm.
• Disaster proof your house. Ask your insurance carrier what steps you can take to make your house more resistant to disaster. For example, even if your local building codes don't require a fence around a pool, does your insurance company want one? And what would happen if you replaced wooden roof shingles with asphalt ones.

Next step

So take a minute, look around and see if there isn't something you can do to cut your insurance costs!