3 Ways To Tell If You Are Paying Too Much For Insurance

It is a mantra that is repeated time and time again by car and home insurance experts, deal shoppers, and smart cookies the world over: if you want to avoid being overcharged, it’s critical that you compare auto and home insurance rates on a regular basis. This doesn’t mean that you have to go and develop an obsessive compulsive disorder that has you checking for insurance policy discounts every other day. But it does mean that you should never become complacent with either the amount of money you’re paying out for insurance, or the level of service you’re getting for your dollars.

When it comes to your car, finding insurance coverage that’s both affordable and as comprehensive as possible can be a bit of a juggling act, but it can be done. You just have to pull periodic comparisons to ensure you’re not being charged too much. But beyond getting online and finding a comparison website, or making a bunch of phone calls to agents of various car insurance companies for quotes on equivalent coverage, how can you tell if that’s already happening? Here are a couple of things to consider that you may not have thought of.

• What’s your driving record like? As you probably already know, auto insurers offer insurance policy discounts to drivers with clean records and frequently punish those who have blemished records with slightly elevated rates. In some cases, those rates can be extremely elevated depending on how bad your record really is. Unless you’ve never had so much as a single solitary incident behind the wheel – speeding ticket, parking ticket, fender bender or full-on accident – then your insurance policy premiums have, at some point, been negatively impacted. But if you’ve worked hard to clean up your act behind the wheel and it’s been a long time since your last “incident,” then it’s possible that you should have seen at least a minor decrease in the amount of money you’re paying out. On average, a black mark will stay on your record for three years. But you shouldn’t expect your auto insurer to stay on top of your record – in the end, that’s your responsibility. If you think you’re still being charged for an infraction that’s long since disappeared from your driving record, contact your insurance company and ask them to lower your rates.

• Are you getting hit with extra charges or hidden fees? Whether or not a fee is “hidden” actually depends on your own initiative and sense of responsibility. If you never read your car insurance bill and aren’t aware of what you’re paying for, then pretty much everything is hidden – but that’s not the fault of the insurer, it’s your fault for not looking at your statement. So take a closer look and go through your bill line by line. If you discover anything that you can’t immediately identify, pick up the phone and talk to your insurance agent to find out what that is. Some insurers will charge you a convenience fee for breaking your bill up into monthly installments, with the average charge being around $10 per month. If you’re able to pay for your car insurance in a single lump sum, you could save around $120 per year.

• What kind of customer service do you get when you have to pick up the phone to talk to your agent or file a claim? This goes for any kind of insurance, be it car or homeowners. If the service is lousy, the odds are you’re being overcharged. Unless, of course, you’re actually paying a rock bottom rate and the tradeoff is having to deal with endless hold times and customer service reps that border on rude. In that case, you should still make haste to compare auto and home insurance rates, but also throw in a bit of research on the company’s reputation for customer service. Sometimes, paying more for the extra “TLC” is worth it.