Lowering Your Insurance Costs Has Never Been Easier


Reducing Risk And Cutting Insurance Costs

There's one guaranteed way to lower your insurance costs: reduce your risk. The purpose of getting insurance is to mitigate risk and provide some peace of mind, so you know you’ll be taken care of should something go wrong. Here are three steps you can take right now to control risk without extra insurance: Eliminate risk altogether, lower the probability of something happening and assume the responsibility yourself.

SEE ALSO: Going Green Lowers Your Home Insurance

Eliminate Risk Altogether

The most obvious and easiest thing you can do is simply avoid whatever risky activity you’re thinking of. Do you really need to go skydiving, plan that snowmobile adventure or attempt to set a land speed record? This method may not work for chainsaw inspectors or X Games contestants, but for everybody else, it is easy. Practically speaking, here are a few changes to consider:
  • Delay getting a driver’s license for your risky teenage son
  • Move to a safer neighborhood and away from a high crime area
  • Don’t buy a house in a location prone to hurricanes, mudslides, flooding or other severe weather
  • Don’t wear expensive jewelry

Lower Risk

If you can’t eliminate risky behavior altogether, the next option is to lower the chances of something happening.
  • If you own collectibles, such as a valuable comic book collection, consider various methods to protect it. Cover items in a plastic sleeve and store them inside a safety deposit box, instead of underneath the bed or in the attic.
  • Wear your modest jewelry collection.
  • Help reduce doctor visits by eating right, exercising and stop drinking and smoking. If you’ve eliminated most of your risk, you can switch to catastrophic insurance instead of a more comprehensive program that lets you run to the doctor after every minor scrape and scratch. This should reduce your out of pocket costs as well.
  • Auto insurance costs can be lowered by parking your car inside a garage or other secure area instead of on the street.
  • A fire extinguisher, car alarm or airbag will also help reduce some risk.
  • Stop using your cellphone to talk or text while driving.
  • Take your car in for a regular tune-up.
  • If your driving record is similar to Lindsay Lohan’s, consider driving a Hyundai instead of a Maserati.
  • Have your property inspected for damage or potential safety issues.

SEE ALSO: You’re Paying Too Much For Home Insurance If You Live Here

Accept Or Assume Risk

The final step for managing risk is simply to accept some of it yourself by paying for potential losses out of your own pocket. It might not make fiscal sense to insure an old bike, boat, trailer or piece of jewelry that’s only worth a few bucks. It could be cheaper just to pay for a new item after you lose it instead of buying coverage. Part of any robust insurance strategy includes determining whether or not it’s worth purchasing coverage depending on the likelihood of the event occurring. For example, it’s not worth getting flood insurance if you live in San Diego, or earthquake insurance if you live in Arizona.

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