We are going to shop for insurance

[fidgiegirl]

It is time to shop for insurance. I think we are probably paying good prices but just want to check things out. We didn't really do this thoroughly when we got married and it is bugging me thinking we might just be shelling out hundreds more than we need to . . .

I have prepared a chart to help organize the details. That way I have the information needed to get quotes. In the past I have been frustrated by not having it all at hand and then the agent calls me back 100 times and bugs me and I get mad. :|(

I have questions like wondering if DH's boat would get replaced or just paid the actual value. Also thinking we will up some deductibles since our EF is now very well-funded. We are currently at $500 on homeowners and probably will go up to $1,000. Cars are at $250 and probably will go up to $500.

Anything else to think about when we are insurance shopping?

:thankyou:

[dado potato]

I had good results raising deductiles as the amount of reserves available increased. Premiums were less, as the amount of risk being transfered to an insurance company dropped.

Marketing of insurance has its share of gimmicks that can complicate comparison. I think the buyer needs to be rather exact and consistent in asking for bids from different companies for identical coverage, deductibles, discounts, etc.

[rosarugosa]

It definitely makes sense to increase your HO deductible. The companies will raise your premiums and even drop you if you put in too many little claims. So if you're not going to put in little claims, it make sense to have a big deductible.

PS: Not nearly as much fun as shopping for socks, is it???

[Jonathan]

Depending on the age of your cars, you may want to drop collision entirely. You have to compare the possible payout to the cost of the extra insurance.

Check into using the same company for all policies - they often give a discount for multiple policies.

When you get to mortgage free, consider an umbrella policy, but don't put that into the mix now.

[fidgiegirl]

PS: Not nearly as much fun as shopping for socks, is it???

:D

[fidgiegirl]

Thanks for the reminder about collision. We will crunch numbers but thinking we will stick with it at this point as our cars still have a bit of value in them. It was a good reason to take a look-see at the blue book for DH's car. In fact, now I'm curious about my own vehicle's value.

We already have an umbrella policy . . . DH has had it for years in the event of a lawsuit. This spurs us to ask some questions about it, though, like what does it actually cover and also, does it cover me?! It does cost $250 a year, but that would seem like chump change in the event of a suit. Our BIL is going to potentially be involved in a suit for a small accident that was really caused by both people, not just him, and so this is kind of close to home right now. When I think about it, though, to my knowledge no one I'm reasonably close with has ever been sued.

I suppose that's the "magic" of insurance. It's like gambling, and they want you to be uncertain so that you take the safe road and pay for their product!!

[redfox]

RE: lawsuits - to quote my father, a retired attorney... The cost of being sued is is always high, even if the lawsuit is frivolous. Retainer fees to defend oneself are huge. We keep a liability umbrella against lawsuits, especially since we have a hot tub.

[jp1]

I agree with redfox. The HO policy, and if necessary, the umbrella, will pay for defense costs if you're sued, even if it's just frivolous. Normally the umbrella will drop down to cover anything the underlying policies (HO and auto) cover, so if you're on those it should cover you as well. I'd definitely ask to make sure though. (I'm an insurance guy but have always worked in business insurance, never personal, so my knowledge is all based on what I've learned in various professional development classes.)

As for buying insurance, the boat is probably going to be actual cash value, just like cars. On your HO policy though, you can get replacement cost for your personal property. I'd also recommend coverage for your personal property off premises. The cost on our policy is literally a few dollars, but it's nice to know that if my bike ever gets stolen it'll be covered, although I doubt it would breach the $500 deductible, even with replacement cost.

[treehugger]

Re: car insurance. Ask for a detailed itemization of what the insurance covers. When we "audited" our coverage last year (we weren't shopping around because we already knew we wanted to keep our life, car, and home insurance all with the same agency), we discovered that we were paying extra for a rental car, in case it was needed. But due to our circumstances, we wouldn't need a rental car in the event one of ours was in the shop, so we axed that. There were one or two other little charges we did away with, too, that now I can't remember.

Re: home insurance. Since home values have gone down dramatically, we were able to lower the amount needed to rebuild, and therefore lower the premium.

[jp1]

treehugger, I'm concerned that you lowered your HO insurance for your house. In theory it shouldn't be any cheaper to rebuild your home now then when the real estate market was still up. Except maybe that construction companies are not busy now so they're offering cheaper pricing. If that's the case then your decision makes sense. The insured amount should be strictly the cost of rebuilding and not at all related to the sellable value of the home.

[treehugger]

treehugger, I'm concerned that you lowered your HO insurance for your house. In theory it shouldn't be any cheaper to rebuild your home now then when the real estate market was still up. Except maybe that construction companies are not busy now so they're offering cheaper pricing.

You raise a good point, and I should have been more clear. The costs of reconstruction have indeed been lowered here, and our house was appraised (I mean the rebuild costs, based on how the house is built, square footage, amenities, etc.) at an incorrect (too high) value when we originally purchased the HO insurance, so, based on those factors, we were able to lower it. We think the original agent made some incorrect assumptions about number of bathrooms, and square footage. This time around, the agent asked us a bunch of questions and then ran software that told him how much to enter.