How to review your auto insurance coverage
Each year the same thing happens: you open the mailbox one evening to see a letter from your insurance company. It’s time to renew your auto insurance.
Guess what? The premiums have increased. Again.
Most people sigh in discontent and make a mental note to remember to pay the premium. That’s a great way to buy something without knowing what you’re buying. Instead, we should all be using our renewal letters as a sign that it’s time to review our auto insurance coverage.
What do you Want?
There’s no sense in signing an existing policy or increasing your coverage if you don’t know what you want. Sit down and write out a list of things you’d like to have from your auto insurance coverage. Make another list of things that have changed since the last time you reviewed your auto policy.
Like many other financial reviews, if you complete this exercise yearly it shouldn’t take longer than five minutes. For people who have never done an auto insurance review, or who haven’t done one in a while, this process will take a bit longer. At any rate, making these lists helps keep your thoughts clear when it comes time to contact auto insurance companies. With a list, you won’t forget to ask for coverage on thing X or be as susceptible to upselling.
Call your insurance company
Give your insurance company the opportunity to keep your business. Most companies have a toll-free phone number for you to call and speak with a representative. Other companies require you to contact your insurance broker. Either way, loyalty discounts are often high enough that it warrants a phone call to your existing company before you begin comparison shopping.
When you call your insurance company or broker, explain that you are unhappy with your existing coverage and are looking to shop around. Mention the changes that have occurred since you last updated your policy. Maybe you’ve taken a driver’s education class or gotten married. Maybe you’ve moved and when you changed your address you forgot to mention that you now park in a garage instead of on the street. Even small changes can have a huge impact on your insurance.
Shop around
Once you’ve received an updated insurance quote from your insurance company or broker, take to the internet and the phones to contact other companies and brokers. Just like buying a car or grocery shopping, frugal savers love to check out prices at multiple stores before making a purchase. Although it can take a bit of time to give your information to various websites and brokers, the cost savings could make it worth your while.
Each year millions of us auto-renew our auto insurance coverage without taking the time to ask ourselves if our coverage is right. With a few phone calls to your insurance company or broker you could save hundreds on auto insurance. Savvy shoppers can also take it a step further and use multiple brokers each year to get a bunch of different quotes to make sure they’re getting the best auto insurance coverage for their needs.