It’s an old cliché that there are only two guarantees in life: death and taxes. Well, these days, there’s something else that’s just as reliable as Uncle Sam and the Grim Reaper: the demand for insurance.
In order to get your driver’s license in the U.S., you need to show proof of car insurance at the DMV. In order for a bank or other financial institution to underwrite your home loan, you have to show proof of home insurance. I learned firsthand just how critical car insurance is. A few years back, I decided to shop around for insurance deals on my vehicle policy, and found a great discount with a different insurance provider. I made the switch, without thinking twice about whether or not I should notify the lien holder on my vehicle’s loan. Sure enough, I got a phone call from my lender a few days after my initial car insurance policy had been cancelled, demanding to know why I was no longer insuring the vehicle, as it was part of the contractual agreement for the loan.
If you’re shopping around for car insurance or home insurance, it’s important to consider several key factors in your decision:
- Your deductible. This varies based on what kind of insurance policy you’re talking about – it’s typically higher for home insurance than car insurance – as well as what type of coverage you have. The higher your deductible, the less you’ll pay in premiums; however, you’ll also be on the hook for higher out of pocket expenses should you need to file a claim.
- The insured item(s). I have a friend who found out – years too late – that he was paying way too much for his home insurance. How? His insurer had written him a policy for 150 percent of his home’s value, resulting in far higher premiums.
- Special discounts. Having a home security system can net you a major discount on your home insurance policy. Having a short commute to your job can save you big bucks on your car insurance. Insurance deals abound, sometimes where you’d least expect them.
- Added perks. Your premiums may come with more than just basic home or car insurance. Many home insurance policies now include an option for identity theft protection. Some companies, like Churchill car insurance, guarantee any repairs received through an approved repair shop for five years – a warranty many repairers don’t independently provide.
Of course, sometimes discounts can be too good. There’s no use in having a home insurance policy if it’s not reliable home insurance. It’s critical to know what you can expect in case of an emergency – who to call, what they’ll do, how long it will take for you to get the aide you want, need, and have paid to receive.