These days we have all sorts of different insurances and they can end up costing us a lot of money. It is wise for us to think about whether we can save money by paying out less for insurance and so there are a number of things that we can think about and try to see if we can save money.
Is this insurance necessary? – it is worth starting by thinking about whether the insurance is necessary. Sometimes we can find that we have an insurance policy which covers us for something and that we have another which also includes cover for that. This might be hard to spot in the small print or might be in work insurance or one that is provided free with something that we are not aware of. It can be worth seeing if you can check to find out.
It is also worth checking what you have insurance cover for and whether it is all necessary. For example, you might have house insurance cover which includes bikes but you no longer have a bike. Also think about the risk that you are covering and whether it is worth it, such as perhaps having an extended warranty on a £40 kettle which you pay £40 for when it would be cheaper to pay for a new kettle rather than buy the insurance. Even if the insurance was twice the price, if the kettle breaks down after four years you may be happy to buy a new one anyway. Also consider whether you need everything that is added into the policy that you may be able to opt out of such as legal cover. You may also be able to increase your access to lower the premium, you can check with your insurer about this.
Consider the risk that you are taking as well. It is likely that you will want to insure your home against fire but is it necessary to insure your phone against theft if you do not take it out anywhere with you, for example, So carefully access the risk to see if you really feel that it worth paying the insurance for items or not.
Is it available cheaper elsewhere? – it is really wise to compare the price of insurance to make sure that you are not paying more than necessary. There are lots of companies that offer insurance these days and it is very likely that if you have not switched insurers lately that you will be able to find cheaper insurance elsewhere. It is a good idea to check this every year because insurers change their prices regularly and the same company does not stay the cheapest for long.
Comparison websites will give you an idea of who is the cheapest although not all sites appear on them. You may need to look at sites that only deal direct as well to see whether they are cheaper. Also comparison websites can be biased and only list insurance companies that pay them commission so there could be cheaper ones available that they have not got listed. So try to find an unbiased site and do some research yourself as well.
Can I reduce my risk to get costs down? – it is also wise to think about whether you can make any changes which will reduce the cost of your insurance. For example for your house insurance it may be cheaper if you have windows and doors with secure locks or fit a house alarm and smoke alarms. For car insurance it could be cheaper if you park on your driveway rather than a main road, have a car alarm and have a car worth less money to replace. If you have health insurance you may be able to make lifestyle changes that could make a difference to your premium.
It can be good to speak to your insurer and check whether making these changes would make a difference to how much you are paying for your insurance. Also find out how much of a difference it will make and then you will know whether it is worth paying out the money to make these changes or not.