These days it seems everything is going up in price and insurance premiums are no exception. The rise in Insurance Premium Tax is another factor and of course insurance is one of those necessities which involves spending money but doesn’t immediately give you anything to take home in a bag.
There’s a huge temptation for all of us to either cut out some policies or compare prices through the multitude of comparison sites, with a view to accepting the lowest possible quote. But we do need to be wary of this. The lowest priced policy may be cheaper for a reason and may not provide the response we want when we need it most.
Another way to cut cost is to consider reducing your cover. Do you really need all the “bells and whistles” that go with the policy? For example, many pet policies provide more than just veterinary fees protection which may be all the owner wants or needs.
Sometimes though, the elements which can be discontinued to make savings are potentially more fundamental. When considering a car insurance renewal, you could save on the premium by increasing your excess. This may be fair enough if your existing one is modest but also beware of compulsory excesses which may have been imposed due to the type of car you drive or something in your driving record. If you have an accident, would you be able to find the excess payment without difficulty? Remember that repairs may not start until you’ve paid it.
Legal expenses cover and courtesy car cover can be optional with some insurers and provide an opportunity to generate a premium saving. If you have an accident that’s not your fault, but are not injured and have no legal cover, are you sufficiently skilled to be able to reclaim your uninsured losses? Will you need a courtesy car whilst your vehicle is being repaired, especially if the accident was your fault? On the household insurance side, what would you do in the event of a claim or dispute if you don’t have legal cover?
The point of all this is to draw attention to the importance of carefully considering exactly the cover you need before cutting out any elements to reduce the cost of the policy or renewal. Ask yourself how you would cope if you didn’t have the cover and an incident or accident happened. If you think you need that particular protection, then keep it. It could cost you more in the long run if you don’t.
If you need any help applying these issues to your own circumstances, we’ll be happy to talk it through with you.