Insurance

How to save money on premiums

Insurance files It seems that you can just about insure anything and everything these days, you can insure against losing your job, against developing a health problem and even against breaking your furniture.

The type of insurances you end up buying really depends on what you want to protect the most.

Waiting Period

Insurance premiums can vary depending on the risk you pose to the pool of money being collected, or the chances of you claiming. So the best way to reduce premiums is to look at you really need and then change the terms so that you can only claim if you really need to. Take income protection insurance for example, this type of insurance pays a monthly benefit should you not be able to earn an income due to health problems or redundancy. This type of insurance has a waiting period and you have to wait out this waiting period before you can make a claim. So if you were the type of person who keeps a few months worth of income as a backup in savings, then you could increase this waiting period to reduce the premiums.

Locking your premiums

A lot of people cancel their insurances when they find the costs too much to bear. This is especially the case with insurances where the premiums go up as you get older. There is a way to lock in the premiums until you will hopefully require less insurance. For life and trauma insurance there are options to lock in the premiums until you reach the age of 65 or 80. This can be useful because it is around these ages that you probably want to spend less money on insurances.

Excess

With other types of insurances which carry an excess, increasing your excess can reduce your premiums. An insurance which you are very unlikely to claim on could be a candidate for increasing the excess. You could also keep some savings earmarked for paying a higher excess and even add to it from the difference you save in premiums.

Dual Covers

With certain health event type insurance you can accelerate the payment from a life insurance to reduce the premium also. So for example you had $100,000 worth of life insurance and $50,000 worth of accelerated complete disability insurance and you were to make a claim on the disability insurance, then you would be left with only $50,000 worth of life cover. This can be a good way to structure your insurance if both covers are covering the same thing, such as debt. So if a $50,000 debt was all you needed to be paid off if the worst should happen, this method would be beneficial. The debt would only need to be paid once, either if you died or became completely disabled.

We can help you structure your insurances if you like to keep premiums manageable. We can provide recommendations based on your own unique circumstances.