Saving on insurance to mark World Savings Day

By Janice Roberts

To mark World Savings Day today, the 31st of October, Alexander Forbes Insurance, recommends that you evaluate your short term insurance policy and make sure that you are only paying for insurance cover that you actually need.

Premiums are partially dependant on the assessment of a person’s risk factors so making simple changes now can yield benefits by decreasing the monthly premiums of a policy.

1. Car

Policy holders can reduce monthly insurance premiums by by driving a lower powered, lower value or lower risk vehicle, limiting your mileage, adjusting the annual depreciation value of your car, upgrading the security level of your vehicle such as installing a tracking device, increasing your excess voluntarily and insuring your vehicle for named drivers only. Review the cover extensions that are charged for and decide if you really need them. For example if you have more than one vehicle in the household, do you really need Car Hire cover? Do you need Car Hire cover on all of the vehicles?

2. Household

On your contents cover, you may decide that certain items would not be replaced, like that old grandfather clock or a sentimental piece of jewellery. These you could negotiate with your insurer to have removed from your sum insured. Every year, it is important to re-evaluate insured items to decide if the possibility or severity of a risk makes the item worth insuring. Should you consider reducing your cover or self-insuring, Dipesh Radia, spokesperson for Alexander Forbes Insurance, suggests that you put the premium saving away each month to provide for the extra risk that you are now taking on.

“If you improve your risk by making it less likely to suffer a loss, your premium may decrease. For example, if you moved to a high security complex or instead of parking on the street, build yourself a lock up garage,” says Radia.

3. Business

Review your business insurance regularly to identify items less important to you and ensure that you have not duplicated cover or have unnecessary coverage. Risk improvements may help to reduce your premium immediately if discounts are offered for them; if immediate discount is not offered the improvement may protect your loss history, which in the mid to long-term will lessen the chance of premium increases and may even lead to reductions. Examples would be installing a security system or fire prevention system.

Radia stresses the importance of obtaining the maximum value from your insurance cover by only paying for the cover that you need. You should talk to your insurance adviser to match your cover to risk and to determine what you can do to lower your insurance cost immediately or over time
Radia recommends that by consolidating your portfolio into a single policy, you can obtain substantial discounts, especially if you own a number of vehicles, properties or a business.

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