Money in the Middle

Sandwich Generation Talking About Money Up, Down and Across Generations

Shop for the Best Insurance Deal

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Working or retired, one of the best things you can do for your pocketbook is to shop and compare when you purchase insurance or before you renew an insurance policy. It’s a lesson worth teaching your young adult or new driver as well.  Inertia may be costing you hundreds of dollars a year

 So can you really save a bundle like it says on the TV ads?  Maybe.  But you need to make sure you are comparing apples to apples, and consider benefits beyond price.

 The one insurance it may not be worth shopping for is health insurance if you have access to a good group plan at work.  But for auto/home, life and long-term care –and if you are buying health insurance or Medicare health plans it is worth taking the time to shop and compare.  Prices are often dramatically different between companies – just make sure you dig into the differences and understand the tradeoffs.

 Here are some tips on what to look for when you shop for insurance:

 1.  Look for a highly rated company.  You want an insurance company that will stand behind you when you file a claim.  Some lower rated companies offer lower rates, but is it worth the risk?  Here information on what the insurance ratings mean.

 2.  Special group rates may not be the best deal.  You’ll find insurance plans through a variety of groups and associations such as AARP, AAA, alumni associations, and professional associations.  Sometimes it is a set discount off of a standard policy (like 5%) or it may be a special policy designed just for the group (not necessarily a discount).  This is where it is really important to compare benefits and rates.  If you are looking at AARP programs, take a look at the series CBS is doing on AARP’s programs.

 3.  Online or local agent.  Decide what’s important to you and how you think you’ll want to interact with the company in the case of a claim.  Some companies offer their program both through a local agent and online or by phone.  It’s a personal preference and the rate may or may not be different. 

4.  Health conditions may limit your options. For life insurance, health and Medicare plans and long-term care insurance, your health is an important factor in the price of the policy.  For example, some term life policies require limited underwriting but cost more than a term life policy with full underwriting.  So when you speak with an agent, make sure you mention any chronic or serious health conditions upfront.  You’ll save time and frustration.  Group policies, like life insurance you buy through an employer, are usually more expensive, but if you have a health condition may be a good buy.  Same for long-term care insurance.

 5.  Loyalty discounts.  If you are dealing with an insurance company that has multiple types of products, you may be eligible for a discount because you own one of their other products.  For example, many of the long-term care insurance companies offer loyalty discounts on their policies if you have another type of policy with the company.

 Don’t let inertia stop you from saving on your insurance costs.  and never cancel a policy until you are sure the new one is in place.

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Written by Laura Rossman

August 27, 2009 at 2:26 pm

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