Tuesday, 26 February 2013

How to Avoid Overpaying for Insurance

Insurance is an expense that you have to deal with.  To not have insurance means not protecting yourself against something you might not necessarily be able to afford.  It is so important that in many cases it is mandatory to have or even illegal not to have it. You may already think that how to avoid overpaying for insurance.

But despite the sometimes annoying enforcements of insurance, it is a truly important product that all responsible adults must have.Avoid Overpaying for insurance


However, insurance can be expensive.  Paying your premiums often takes a serious chunk out of your monthly income if you let it, but you don’t necessarily need it to.  But remember that each type of insurance has different rules for saving money.   Here’s how to not overpay for your insurance:

Avoid Overpaying for Insurance


Home

If you are buying a home and you are open to locations, choose a place that doesn’t suffer many natural disasters.  This, of course, is easier said than done, but it’s worth considering.  Avoiding natural disasters is good for every part of your life.

But if you already have a home, make sure to keep it as safe as possible to be eligible for the different discounts that insurance companies offer.  For example, some companies offer a discount if you have a fire extinguisher in the house.  Another really common discount is to have a working security system.

The safer your home is the less expensive your policy will be.

Auto

If you are in the process of buying a car, remember that the flashier your car is, the more expensive it is to insure.  This is because flashier cars tend to drive faster and get more moving violations and ultimately accidents, so keep this in mind when you are choosing a car to buy.

Insurance companies give discounts for anything that they believe shows that you are less likely to get into car accidents and cost them money.

To prove to insurance companies that you will not get into accidents, you must show them that you are responsible.  That’s why things like good driver and good student discounts exist.  The longer you can go without getting into any kind of trouble,more insurancee companies are going to assume that youwantt in the future.

Life

The key to saving money on life insurance is twofold: choosing the right type of life insurance and being healthy.

There are essentially two types of life insurance: term and whole.  Term life insurance is just plain old life insurance than pays your beneficiary if you unexpectedly pass away, and the policy expires eventually.   Whole life insurance lasts for your whole life and has an extra investment component attached to it meaning policies are much more expensive than term policies.  So choose the right one for your situation and remember that you can always invest your money yourself.

The way life insurance companies determine how much your policy is going to cost is by figuring what your chances to suffer an untimely death are.  The healthier you are and the safer your job, the cheaper your premiums will be.

Insurance is a game of probability.  The less chance that you’ll actually need to use your insurance, the cheaper your insurance will be.

 How to avoid overpaying for insurance

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