Insurance Premium

Cutting the cost of an insurance premium is possible with a bit of thought. The willingness to compare options and the ability to think about what insurance is actually required is crucial in reducing the insurance premiums.

Life insurance is an area where money can be saved by looking at exactly what is covered. As well as protecting dependents in the event of death, life insurance is a sophisticated investment product. In some cases it is possible to get life insurance with little or no out of pocket borrowing. Life insurance premium financing allows for a person, usually a business owner, to borrow against their assets to buy their life insurance. Due to the fact that there are financing charges this is not the cheapest way of buying life insurance, although it can involve no out of pocket expenses.

Many people looking for a “pure” life insurance product will look at term insurance. In some cases, especially for the elderly, the death benefits are less then the premiums paid. Return of premium life insurance, also known as Return of premium term insurance provides death benefits and a return of premium feature, that means that the family is guaranteed to be financially better off than the total amount paid in if the policy holder dies.

The cost of an auto insurance premium can differ depending on which insurance provider is chosen. This is because different insurers will use slightly different factors when calculating what is an acceptable risk. One aspect that reduces auto insurance premiums is the person who does most of the driving. It is often a good idea to ensure that the main driver is noted on each car rather than having one person being named as the main driver on all the insurance. In the longer term care should be taken with the model of cars and the insurance that certain cars attract as a long term cost in the same way that leasing costs and maintenance costs are. Insurance can often make certain cars less economical than they first appear.

When looking at a mortgage insurance premium it is important to remember that the Canada Mortgage and Housing Corporation is not a monopoly provider of mortgage insurance as many home buyers still believe. It is possible to often get a cheaper mortgage insurance quote from one of its rivals such as Genworth. It is also important to remember that mortgage insurance premiums are only compulsory on “high ratio” loans, where the home buyer has a deposit of less than 20% of the house price. If the deposit is only slightly lower it is a good idea to negotiate as the difference between an 81% and 79% mortgage could be thousands of dollars. One way to lower the price is to pay separately for fixtures and fittings through an unsecured loan or a deferred payment.

When looking at the cost of an insurance premium home insurance is one of the most sensitive to the amount of an insurance excess that is allowed. Often policy holders will over insure their contents, with a lower excess than could be met through their savings. A higher excess can compound and reduce home insurance premiums by many more times than the excess over the lifetime of a policy. In some ways losing this over insurance is a second, tax free, form of interest.

It is also important that the potential policy holder decides whether they want cheap home insurance or premium house insurance. Home insurance can be expensive if it is inappropriate, although care should be taken that cheap insurers do not have a reputation for denying legitimate pay outs.