Dealing With Rate Increases: It Might Be Time To Review Your Policy

Everyone has to deal with soaring insurance rates at some point, so don’t panic. Whether it’s auto, home or health insurance, various factors cause premiums to increase.

It’s important you recognize the various factors so you can act accordingly. This guide will provide ways to handle rate increases across various insurance policies.

Home Insurance

Buying and owning a home is a big advantage. However, numerous people overlook some of the associated costs. Homeowners insurance is one cost you shouldn’t forget because it can increase considerably over the years.

While the cost of insurance may increase because of building costs, inflation, or other factors, there are ways to minimize costs. Some of the ways to decrease your insurance premiums include:

Increase Your Insurance Deductible

A deductible is the degree of risk you accept before your insurance firm begins paying on a claim. With the increasing cost of insurance, it’s no longer sensible to let the insurance carrier assume all the risk.

Consider raising your low deductible of $50-$100 to at least $500-$1,000. This could save up to 25% on premiums. Remember, if you reside in a disaster-prone region, your policy may have a separate deductible for some kinds of damage.

Combine Your Home Insurance and Auto Insurance Policies

Consider purchasing your auto and homeowners insurance policies from a company that provides both. Some companies provide discounts ranging from 5%-15% if you purchase both kinds of coverage from them.

Check around and ensure the cost is lower than purchasing the two policies from different firms before you make this move.

Enhance Your Home Security

You can typically obtain discounts of at least 5% for a burglar alarm, smoke detector, or deadbolt locks. Some insurance companies even offer to lower your premium by as much as 15 or 20% if you set up a sophisticated sprinkler system.

Bear in mind that such systems aren’t cheap and not all systems qualify for a discount. Before you purchase such as system, establish the type your insurer proposes, the amount the device would cost, and the amount you would save on premiums.

Identify What Your Policy Covers

Your home is a huge investment, so ensure it’s sufficiently protected from risks you can’t afford to cover yourself. The policy should also cover any improvements you’ve made, increased rebuilding costs, and major purchases.

Auto Insurance

As a consumer, you probably recognize common factors that are likely to cause an increase in insurance rates, including a speeding ticket or causing an accident. However, there are times when a higher premium may surprise you.

It’s important to know that numerous factors cause the increase of insurance rates, which your agent may not have not have informed you about. Some of these factors include a poor or low credit rating and age. Fortunately, these tips will help you lower your car insurance costs.

Shop Around

Prices differ across companies, so it’s advisable you shop around. Consider obtaining at least three quotes by calling companies directly or accessing information online.

You can also obtain price comparisons from your state’s insurance department. Avoid shopping by cost alone. Instead, obtain recommendations from relatives and friends. You can also obtain information on consumer complaints by contacting your state department.

Sustain a Good Credit History

Establishing a solid history can lower your insurance costs. It’s important to note that most insurance companies use credit information to determine car insurance policies. According to research, persons who manage their credit effectively have fewer claims.

To maintain a good credit standing, pay bills on time, don’t acquire more credit than necessary, and maintain low credit balances. It’s also important to examine your credit record regularly and have any mistakes rectified promptly to maintain an accurate record.

Final Thoughts

It’s difficult to live without insurance. In fact, you probably have numerous insurance bills if you have a family. Insurance is valuable when you need it. However, when you don’t need it, the high bills could make you review your policy. Fortunately, this guide will help you lower your insurance costs.

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