Mackay Insurance Blog
7 Tips to Keep Your Canadian Insurance Affordable
Insurance is our business, so of course we are passionate about what we do!
But honestly, in the four-plus decades our doors have been open, we have yet to meet a new client who is truly excited about buying insurance.
Insurance generally falls into the “must-have” category rather than in the “want to have” category. You know you need it and you understand the risk of not having it, so you put a line item in your annual budget and you renew your policies when their renewal dates arrive.
But if purchasing insurance itself isn’t particularly fun or exciting, imagine what it feels like to learn you have been paying more for your insurance than you need to! That is the real bummer in our industry, and one we want to help our clients avoid!
In this post, learn seven key tips to make sure you are paying a fair price for your insurance.
1. Check Your Credit and Ask Your Insurer to Do the Same
In today’s global online marketplace, where many industries now service a provincewide or even nationwide clientele, credit scores are more important than ever as a screening factor.
Your credit history and score can say a lot about how you handle money and debt. When you’ve worked hard to keep your credit score high or you have worked hard to repair your credit after a tough situation, you deserve the benefits that now affords you!
One benefit can be a lower property insurance premium. You can even pull your own credit score first, review it and clear away any issues. When it is squeaky clean, ask your insurer about credit rating and insurance—you may just earn yourself a discount!
2. Bundle Your Insurance Products
The insurance industry is heavily regulated by provincial and national laws, but oddly, this just makes the competition stiffer to win and keep new clients.
We attract and retain customers through excellent customer service. This includes looking for discounts for our customers. A perk many insurers offer is premium discounts when a customer takes out more than one policy. For example, maybe you have a home insurance policy with us, and now you want to take out an auto insurance policy as well. Or perhaps you have your auto insurance policy with us and your spouse is insured somewhere else. Let us take a look at bundling everything for you. The discounts can be substantial when you bundle more than one insurance policy together with a single insurer.
3. Find the Cheapest Way to Pay
Another easy way to cut insurance premium costs is to opt for the cheapest payment plan the insurer offers. This all relates to the insurer’s own costs of processing payments. You can pay for the year up front, or with many insurers, a three-payment option does not carry any service charge at all.
If one of these payment methods aligns with your budget it can net you a discount of 3 percent or more, without lifting a finger!
4. Review Your Coverage Annually
Your life does not stand still. You add a deck to your house. Babies are born. Kids leave for university. You swap out that old oil furnace for a new propane furnace. Your income changes. You decide to close in your swimming pool. An aging parent has moved into that basement bedroom that your university-aged son or daughter vacated. The policies that fit you perfectly five years ago may not fit who you are today. You may have new exposures that need to be looked at, or you may be paying to insure things you no longer need to insure.
You should make a point to review your insurance policies when they renew each year, and phone or stop in every few years to go through them in person with a broker. Tailoring your insurance to your current needs can sometimes deliver a surprising number of savings!
5. Increase Your Deductible
Even if you aren’t able to find any areas where you are over-insured, there may be options to raise your deductible (the amount you pay out of pocket if you make a claim) and realize cost savings.
The one caveat here is that you should not raise your deductible above the amount you can comfortably afford to pay if you do have a claim under that policy.
6. Don’t Call In That Claim
In the same way that you have to do a bit of forecasting to figure out how much insurance coverage to take out each year, so too does your insurer have to forecast to figure out how to keep the insurance business affordable for clients yet still profitable for the company.
Many insurers now offer a “claims-free” incentive or discount for clients who have not filed any claims for a specific period of time. Sometimes this incentive increases with the amount of time the client has been claims-free.
Not only is it quite likely that your next year’s insurance premium will go up if you file a claim (since this makes you more expensive to insure), but also you will forfeit any claims-free incentive your insurer is offering.
This is not to discourage you from filing claims, necessarily, but simply to say that if your claim is for something small or something your deductible barely covers, it may be worth your while to just pay that particular expense out of pocket to keep your premiums lower.
7. Adjust Your Coverage As Your Property Ages
Your auto is one of the biggest-ticket items you will ever own. But as a car ages, the cost of maintaining full insurance coverage may outweigh your actual benefits.
This can be worth exploring if you are insuring an older vehicle.
Get in Touch
Have questions or want to review your insurance coverage before you renew? Contact us online, or give us a call at 888-853-5552!