Rates of premium for every type of insurance depend on the primary risk factor; the higher the risk, the higher the premium. Insurance companies consider many factors to calculate the risk premium, which determines the cost of your insurance policy. However, there are a few ways to take some charge of the cost and save money on insurance in Canada.
Bundling your home insurance with your car insurance using the same provider helps you get attractive discounts. Insurance companies want more business, and they are always willing to incentivize your offer if you get it for your home and your automobile. Apart from discounted rates, it also makes your life easier by making payments and getting renewal from a single place.
Pay higher deductibles
A deductible is an amount that you contribute towards the claim. If you increase your deductible, the amount of monthly premium goes down. It is advisable to choose the highest possible deductible that you can financially afford in case of a loss or possible lousy situation. Insurance is meant for a significant loss or the worst-case scenario, in which you can benefit even with a higher deductible. You can always ask your insurance provider to quote multiple deductibles and choose what suits you best according to your financials.
Don’t file minor claims
For minor losses or small accidents, you can pay on your own instead of filing a claim. If you file fewer claims, you can save much money on the insurance premium for next year. Many insurance companies provide discounts for the claim-free year.
Insurance is a competitive industry in Canada; you can always compare multiple insurance companies to find more suitable plans. The more you look and compare, the more you will save money on insurance.
Three important things to keep in mind while comparing different insurance companies are your needs, your resources, and the transparency of the insurance companies. We will advise you to choose an insurance company with a customer-first approach. We at Insurance Direct believe in clear communication with the customers to have all the information they need to make a decision that is in their best interest.
Maintain a good credit record
If you maintain a good credit score and allow your insurance company a credit check, you might get a discount on a good credit score.
Install a home monitoring system
Installing an alarm system protects your home against break-ins and theft. Insurance providers consider the home security and monitoring system to offer discounts for a more secure home.
Insurance providers also offer discounts on the monthly premium if your house is not on a mortgage. You can ask your provider for this discount before signing up with them.
Don’t over- or under- insure
Make an inventory list and try to insure only the valuable items. You should also insure the amount of the rebuild of the house and not the house’s market value, which includes the price of land as well. Everyone wants quality coverage, but too much coverage can result in an unnecessary increase in the insurance premium. Doing a proper valuation of your belongings helps you avoid over or under-insurance.
Pay annual premiums
Insurance companies offer discounts on yearly payments rather than monthly premiums. Annual payments can save you a lot of money on the insurance premium. However, if you plan to pay a monthly premium, you can look out for companies that offer free monthly billing without any extra charges.
Maintain your house
If your house is already in good shape, you will be charged less monthly premiums. It is essential to regularly maintain and update your equipment for your safety and security. Keeping your house in good shape decreases the chance of losses, and you can save money by saving deductibles. You can also get claim-free discounts by avoiding the losses and need for the claims.
Newly built houses or condos
Insurance is much cheaper for newly built houses or condos because of the fewer chances of any losses, reducing insurance companies’ risk significantly. If you buy a brand-new house, you can ask for discounts from your insurance company while signing up.
Be transparent and honest with the insurance company. You might save a few bucks on your monthly payment by hiding crucial details from your insurance company, but it can cost you much higher in the long run with a risk of claim rejection.
Pay your premium on time
If you have a monthly premium plan, make sure to maintain enough balance in your bank account in case of automatic withdrawals to the insurance company. If you fail to pay the premium on time, insurance companies mark you as a high-risk client. It may result in the cancellation of the policy or a costlier insurance premium in future policies.
In the case of auto insurance, try to maintain a good driving record and show it off for a discount while taking insurance. Drivers with a poor driving record, accidents, and speeding tickets are considered high risk. Apart from driving records, insurance companies also evaluate how much you drive and where you drive. Less driving means fewer chances of any collision or fines. You can use public transport or carpool to work to lower your premium.
There are many other ways you can save on your monthly insurance premiums. You might get a discount on home insurance if you are aged 55 or above. Choosing a low-risk neighborhood also keeps you safe and costs less in the insurance premium. Insurance companies also consider the sprinkler system, which reduces the damage in case of fire.
It is essential to be transparent and choose the right company with a good record of claim management while choosing your insurance provider. Remember to check terms and conditions carefully and select the right balance between the premiums and the deductibles. Always ask for discounts even if it’s not mentioned in the policy, you might be eligible for one.
Compare and choose the plan carefully because most insurance companies let you change or modify your policy at any point in time, but they charge a hefty fee for it; always look out for the extra fees and fines.
With these tips and tricks, you can save money on insurance and lower your premiums in Canada.