Equifax

Finance Blog

Evaluating Your Insurance Needs on a Tight Budget

Written by Linda Rey on November 25, 2010 in Insurance  |   No comments

Evaluating Your Insurance Needs on a Tight Budget In this economy, every penny counts. Everyone is evaluating what sacrifices they can make to pay the bills. It’s one thing to downsize from the six-thousand-square-foot home, or to drop the third car. However, when it comes…

Evaluating Your Insurance Needs on a Tight Budget

In this economy, every penny counts. Everyone is evaluating what sacrifices they can make to pay the bills.

It’s one thing to downsize from the six-thousand-square-foot home, or to drop the third car. However, when it comes to downsizing your insurance, careful consideration should be taken.

If you’re struggling to make ends meet, discuss with your agent ways to save money on your insurance portfolio. Sometimes you can get a discount if you consolidate your auto insurance with your homeowner’s plan. Or maybe you can get a good student driver discount for your kids.

Evaluating your insurance needs, is specific to each individual, and no two cases are exactly the same. A premium is derived from so many factors. It’s worth doing a periodic review even in stable times to determine if your insurance needs have changed or if you can get a better price.

Checklist: Evaluate Your Insurance Needs

  • Review your assets and liabilities to determine your net worth. Your net worth will help you decide how much insurance you need. Sometimes people in tight times cut their liability insurance, but this may not be where you are spending extra money. Check with your agent as to how your policy is structured.Review with your agent how a personal articles floater for valuable items can save you money. Are you storing your valuables in a safe-deposit box when they’re not in use? That can affect your premium, too.
  • Review the physical damage coverage (collision and comprehensive) on your vehicle. When a vehicle is about eight years old, it might make sense to drop the collision coverage. Collision coverage is paid based on actual cash value versus replacement cost. If you are involved in a collision, you will never be reimbursed the cost of a new car. It may be time to evaluate how much you’re paying in premium for an older car.

Explore Ways to Get Discounts on Your Insurance

Paying your premium in full (if it is an annual policy or a semiannual policy) will garner you a discount. Carriers like when people pay in full because it’s less costly to administer their account, and it eliminates the extra administrative work required when payments are consistently late and cancellation notices have to be sent.

Some carriers offer discounts for establishing an electronic funds transfer (EFT) account if you pay monthly. While you’ll still pay installment fees, they will be less, because you are reducing the likelihood that payments will be late.

There are also discounts for shopping your insurance with a ten- to twenty-day advance notice to the renewal date. Carriers are generous with this as a discount because it gives them more time to organize a sound insurance plan.

Cutting costs may be the goal, however, cutting insurance may not be the best solution. Review your insurance portfolio with your agent to see what savings you can enjoy. Sacrificing critical insurance coverage to save money is a dicey strategy.

Linda Rey is a licensed insurance agent at Rey Insurance with a broad spectrum of expertise in life, accident, health, property and casualty insurance as well as retirement planning and college funding strategies.

Follow Linda on Twitter.

READ MORE:

Summer Toys: Insuring Your Pool, Trampoline, or Boat
Business Insurance Can Help Your Business Grow
Workers’ Compensation Won’t Work For You
FAQs About Disability Insurance

No comments yet


Leave a Comment


Name :


Commenting guidelines

We welcome your interest and participation on this forum, but be aware that comments will be published at Equifax's sole discretion. Please don't use this blog to submit questions or concerns about your Equifax credit report or raise customer service issues. Instead, you should contact Equifax directly for all such matters and any attempts to do so in this forum will be promptly re-directed.

Some other factors to consider when commenting:
  1. Registration and privacy. While no registration is required to visit our forum, participants wishing to post a message must register by creating an account. All personal information provided by forum members incident to registration is governed by our Terms of Use and Privacy Policy.
  2. All comments are anonymous. We'll delete your name, e-mail address, and any other identifying information, including details about your investments.
  3. We can't post or respond to every comment - As much as we'd like to, we can't post every comment, nor can we guarantee that we will respond to each individual message. All questions or comments about your Equifax credit report or similar customer service issues should be handled by contacting Equifax directly.
  4. Don't offer specific legal, tax or financial advice. All of the materials on this Site are for information, education, and noncommercial purposes only and this forum is not intended as a means of expressing views or ideas regarding any specific legal, tax, or investment advice. While offering general rules of thumb is both permitted and encouraged, recommending specific ideas or strategies regarding investments, taxes, and related matters is prohibited.
  5. Credit Repair. This blog is not intended as a venue for the discussion or exchange of ideas regarding credit repair or other strategies intended to assist visitors and community members improve or otherwise modify their credit histories, ratings or scores.
  6. Stay on topic. Your comment should be concise and pertain to the specific post in question.
  7. Be respectful of the community. The use of profanity, offensive language, spam, and personal attacks will not be tolerated and egregious or repeat offenders will be banned from future participation. We encourage disagreement and healthy debate, but please refrain from personal attacks on our WordPresss and contributors.
  8. Finally: Participation in this forum may be terminated by Equifax immediately and without notice for failure to comply with any guidelines or Terms of Use. As such, you should familiarize yourself with all pertinent requirements prior to submitting any response through the blog or otherwise. All opinions expressed in this forum are solely those of the individual submitting the comment, and don't necessarily represent the views of Equifax or its management.

Equifax maintains this interactive forum for education and information purposes in order to allow individuals to share their relevant knowledge and opinions with other members and visitors. We encourage you to participate in discussions about personal finance issues and other topics of interest to this community, but please read our commenting guidelines first. Equifax reserves the right to monitor postings to the forum and comments will be published at our discretion. Do you have questions or comments about your Equifax credit report or customer-service issues regarding an Equifax product? If so, please contact Equifax directly. All opinions and information expressed or shared in blog comments are solely those of the person submitting the comments, and don't necessarily represent the views of Equifax or its management.


Insurance Archive

Stay Informed Sign up for our FREE Equifax email Newsletter