Most people only think about insurance when a loss, injury, or accident has occurred. This is the time you need financial assistance the most. Your insurance company should come through for you by helping you get treatment and restore your life. After all, this is what you pay them for.
But what if you don’t do your homework in getting the best insurance coverage available? Unfortunately, you may be left with bills you cannot afford. The time to find the best insurance for your needs is before such a loss occurs.
When buying insurance, there are a few steps you should always take. You'll want to comparison shop, look for discounts and services, and consider an agent. Also, find a plan you can afford and upgrade later; be truthful with your chosen insurance provider; keep in mind that coverage is not automatic, and update and re-evaluate your policy when necessary.
Here are seven things to remember when finding the best insurance coverage for you and your family.
- Getting the best insurance coverage at the best price requires some research and comparison shopping.
- Use unbiased insurance ratings such as the ones from S&P and AM Best to see what consumers have to say about insurance companies.
- Ask about available discounts and services, consider using an insurance agent, and be truthful and accurate when comparing quotes.
- If insurance is too expensive, go for minimum coverage and update later. Be sure to re-evaluate coverage at least once a year.
1. Comparison Shop
You depend on your insurance to protect your family’s assets and financial wellbeing. But you can’t trust your family’s future to just any company without checking it out first. Insurance rating organizations can help with this. Some of the top ones are AM Best, Weiss Ratings, Standard & Poor’s, Fitch Ratings, and Demotech, Inc.
Insurance comparison shopping is not as difficult as it once was. You don’t have to interview different agents to find the best value. By using comparison websites, you can look at many quotes side-by-side. That way, you can compare similar packages.
Some people stick with a preferred provider, no matter the price. There is nothing wrong with this. But if you are not loyal to one company, you may find it useful to compare providers and costs. You might be able to get a similar policy for much less elsewhere.
Many of these sites will also allow you to buy coverage right from the website. There are many insurance comparison shopping websites available. Some examples are NetQuote, SelectQuote, and Compare.com.
2. Look for Discounts
Raising a family is expensive. No one wants to pay more for insurance than they have to. One way to make sure you are getting the best deal possible is to find all available discounts.
There might be hidden discounts not readily seen on a website. There may be others that agents tuck away for in-office-only clients. You can ask to see all discounts and the qualifications for receiving them.
One common discount is a multi-policy discount. There also may be discounts on safe driving, homeownership, or safety devices.
Cut-rate insurance prices often mean cut-rate customer service and coverage. This is not to say that highly-rated insurance companies cannot offer affordable insurance rates. It also doesn't mean that companies with lower rates are not able to offer competitive coverage and services.
Be sure to check out the company's record with the Better Business Bureau (BBB), American Customer Satisfaction Index (ACSI), or J.D. Power & Associates.
3. Consider an Agent When Buying Insurance
Insurance agents are associated with a certain provider. They are also known as captive agents. These agents own their business; naturally, they are trying to create income while generating business for the provider. Agents are more convenient than dealing with the provider. That's because there is someone to answer your questions.
A captive agent is one who only represents one company; they will only offer you the policy options from the company they represent. Brokers and independent agents work with many companies and have more options.
You might be able to get better coverage with an agent in person. While it's possible to call the insurance provider or purchase insurance online, working with an agent might be better for your circumstances.
Keep in mind that independent insurance agents and brokers often represent many different companies. This gives them access to more offerings for comparison than a captive agent.
4. Remember: You Can Upgrade Later
There may be times when your financial situation prevents you from getting the coverage you need. But insurance minimums are generally very affordable. You should always purchase the minimum coverage required by law by your state. Even minimum coverage can keep you from paying out of pocket.
Once you are able, you can upgrade your policy to include a more comprehensive coverage package. It doesn’t hurt to give your insurance agent a “target premium.” This would be an ideal price you would be willing to pay for coverage. For instance, Progressive offers a feature called the “name your price tool.” This allows you to get the coverage you need at a price you can afford.
5. Tell the Truth
When you apply for insurance coverage, your coverage and premiums are based on the information you provide. But what if you can get cheaper insurance by stretching the truth?
Don't do it. Saving a bit of money is not worth the risk of having your policy canceled for getting caught. Often, the company will not outright cancel your policy. But, they will likely contact you for an additional premium required to maintain coverage once the rates are adjusted. In a worst-case scenario, your claim could be denied if the insurance company uncovers the discrepancy. Depending on the severity of the misinformation you could also be reported to various insurance clearinghouses for fraud, which will make it more difficult to get insurance in the future.
6. Know That Coverage Is Not Always Automatic
If you buy a new car or add new structures to your property, they may be automatically covered for a time. Normally, you have a specific time frame, perhaps 30 days to contact the insurance company and let them know of your purchase. This could be more or less depending on your insurer.
The same goes for trading in your vehicle. The coverage will transfer to your new vehicle, but only temporarily unless you alert your insurance company. Check with your insurance agent or company for the specific notification requirements of your policy.
Any changes in your life should be followed by a call to your insurance company or agent. This ensures you have the coverage you need.
7. Re-Evaluate Your Coverage
At some point, you may have a big life change such as a move or a marriage; or you might have children. When this happens, your insurance coverage needs will change. Even if you’ve had no major life events, it is still worthwhile to do an annual policy check-up to make any changes.
Finding the best coverage to protect your family doesn’t have to be difficult. Use all the tools and resources available to make finding the right coverage a smoother process.