A way to save money

I have been an insurance agent for 11 years and it never ceases to amaze me that as consumers we settle for paying what we are offered initially and stick with it for years to come without getting out there looking for a better deal.

I always encourage my clients to shop around, whether it is with my agency or elsewhere - to make sure they're getting the best rates available.

Our current economic situation and the upcoming tax and budget challenges in our state (CA) will undoubtedly cause many residents financial hardship and I felt compelled to try to help by encouraging any reader of this blog to do the following and try to save:

First and foremost; if you don’t remember the last time you purchased insurance and have been with the same insurance provider for years (even as little as 2 years) this would be the perfect time to shop around. Chances are rates, discount eligibility, and other factors which affect your pricing have changed since you purchased your last policy. So call an insurance agent and have them do the comparison shopping for you – starting this process usually doesn’t cost you more than 5 minutes of your time and can be extremely rewarding.


1. Auto Insurance: A way to save on your current auto insurance is by making sure your information is current. If you moved or changed jobs and didn’t report this to your insurance agent (calling and advising your insurance agent or company was probably the last thing on your mind). Company rating factors which affect your pricing are usually:

a. Mileage driven annually – the more you drive the higher your rate is likely to be.
b. Residence/Garaging address zip code – it is not red lining but where you live does make a difference (accident concentration, thefts, etc.)
c. Discounts: You may qualify for Good Driver, Good Student, Professional Discount (i.e. Educator, Engineer, Scientist), Mature Driver Discount, so call and find out.
d. Rates also differ when you are married, so if you married and have not revised your marital status, now would be the time to do this. You will also benefit from this if you decide to combine policies with your spouse, in that you will likely get multi-car discount if these changes mean that you now have more than one vehicle insured under your policy.

2. Home Insurance: If you are a homeowner, chances are your policy and rate was offered to you at the time of purchase, during escrow. If this was the case, you were probably rushed to make a decision to ensure your escrow would close by the closing date. One of the drawbacks of this is that the rate probably came from an agent affiliated with your realtor whom probably didn’t make any effort to ensure you got the best rate possible. Here are a few tips on what to look for that may save you hundreds of dollars:

a. If your home insurance came about existence during the escrow process and your home insurance provider is not the same as your auto insurance provider, START DIALING! A good insurance agent will always try to keep both policies with the same provider. Insurance companies offer multi-policy discounts equaling up to 20% off each of your policies – which means you will surely save money by making this change.

3. Policy Deductible: Increase your policy deductible: Changing your “Collision” deductible on your auto policy and “All Perils” deductible on your home insurance policy are another way to reduce your cost. Most people assume they need to have this amount to pay out of pocket when a claim arises, which is a popular misconception. The deductible amount is taken from the claim payment made by the insurance company. Meaning if you have a collision, and your auto damage is $5000, your insurance provider will reduce payment by your applicable policy deductible. In the case of a homeowner’s policy, the higher the deductible the bigger the savings. Home insurance policies are intended for catastrophic losses, resulting in tens or hundreds of thousands of dollars worth in damages. An all perils deductible of 1000 to 2500 would help reduce your premium cost.

4. Agent VS. Direct: Are you with an agency or did you buy direct from a company? It’s good to know the difference. In my opinion, it is always best to go with an independent agent/agency. Why? Agents represent the customer not the company. They have appointments to write through various insurance providers and they can effectively find you the lowest rate amongst the companies available to them. If you buy direct, you are buying a company’s proprietary product – which means that is the only insurance program they offer. They are not comparing rates with other carriers since that would be giving you the option to buy from their competitors. Who are direct writers?

• AAA / Autoclub
• 21St Century/AIG
• Geicco
• Allstate
• Statefarm
• Farmers

These are just a few of the company’s that only offer their products to consumers. If you have a policy with them, chances are you can save money by calling an agent and having them do some comparison shopping for you. In my experience, we ALWAYS are able to save customers money through non-direct carriers who also have solid reputations and are available through insurance agencies. Some carriers in CA that offer lower pricing in comparison to direct insurance companies are:

• Allied (A Nationwide Company)
• Safeco
• Mercury
• Travelers
• Hartford
• Progressive
• CSE

I hope this helps some of your readers save significant amounts of money. Just thought I’d offer my expertise and get you all to save money in this rough economic climate.