7 ways to lower your insurance costs

1. You should shop around for your insurance coverage

Blindly staying with the same company year after year will rarely, if ever, result in the best coverage at the best rates. I suggest you bring in 3 agents every year, or at least every other year, to review your insurance needs, recommend coverage, and provide costs.

I would directly bring in an independent regional agent, an independent major, and a freight forwarder. By doing this, you are accomplishing a number of things. First of all, you are shopping at the best costs. But second, and more importantly, you’re looking to find out what coverage each will recommend. This will help you find out if your current coverage is adequate, if you are over- or under-insured. If all three companies recommend the same coverage levels, you’re probably safe. If two of the three recommend higher or lower levels of coverage than you have, you’d better find out why and see if you agree.

You don’t need to be an insurance expert as long as you’re dealing with someone who is. You want to build on your experience and by undergoing this process at least every two years, this is exactly what you will do. You want each to give you a complete written proposal that includes the recommended coverage, explanations of these recommendations, and the costs of each. Without costs for each coverage area, you’ll have no way to effectively evaluate one company against another, and you’ll lose the option to pick and choose policies for different coverage areas from company to company.

Remember, you don’t need to have all your coverage with one company. In fact, unless individual costs are better with one company, or a company has a special package plan for your type of business, you probably shouldn’t keep all of your coverage with one company.

There is no reason why you can’t have commercial coverage with one company and auto coverage with another, etc. In fact, unless they give you significant discounts for doing so, the only reason that would lead you to buy all coverage from one company, although some policies may cost more, would be laziness or convenience, which is often just another sloth form.

I know of a company that hadn’t done a competitive review of their insurance for over 20 years. When they did, they saved $30,000 a year, or almost 15% in this case.

2. Make Sure You’re Not Over-Insuring

It won’t do you any good to insure something for $100,000 when the replacement value is only $75,000. The agent and the company that more than they have to do. They will not refund premiums if you have overpriced something and therefore overinsured.

It is up to you to know the value. If you cover the equipment for up to $10,000,000 in replacement value and the full replacement value is only $5,000,000, that’s your problem. You should know or have a very good idea of ​​the actual replacement value. The reverse of this is also true, don’t under-insure. Make sure you know if you are insured for replacement value.

This is an area where there is a lot of gray area. This is another good reason for annual reviews. By doing these, you’ll get opinions and advice from a number of different sources and an inconsistency is much more likely to come up. Remember, don’t just ask agents and companies to provide offers on current coverage, but to evaluate your operation and recommend coverage and provide costs.

3. Ask your agent what you can do to lower your insurance costs

They won’t tell you unless you ask. By asking, you are expressing your concern about costs. Dissatisfaction with costs should be interpreted by the agent as a sign that you will seek coverage elsewhere. The agent suddenly has a great incentive to try to reduce his trading cost control.

4. Look for agents or carriers that specialize in your type of business

Start by asking any association you belong to for suggestions. Also, ask competitors, suppliers, and even the Chamber of Commerce. If there are special plans for your type of business, you should be able to realize significant savings due to the types of packages and levels of coverage. You’ll find that the necessary levels of coverage are built into the plan and, if purchased separately, would cost you much more each year. I was able to save over $1,200 a year by finding a plan designed to cover companies in my industry.

A note of caution, though, just because an agent tells you they’re offering a great plan for your type of business, don’t assume this to be true. He must still get at least three quotes. The agent with the special plan may just be calling you that to sell you when in fact you are not that special at all to business in his industry but they are not necessary to his business at all.

5. Make sure your insurance covers replacement value and not current value

It may seem like you’re saving money by covering actual value, but if you have a claim and need to replace lost or damaged equipment, you’ll quickly find that you’ve been short-sighted. In most cases, the current value will be a fraction of the cost you’ll need to replace the item. Do not cut corners in this area. Make sure you have replacement value or at least coverage equal to what the cost of great used equipment would be.

6. Remember, premiums are just another name for payments

Your goal is to control these payments; buy only what you need and get the best value for your purchase. Ask for coverage and cost recommendations in writing and have the agent justify these recommendations to you. Insurance agents are sales representatives. Insurance is your product. Do not forget this. Plain and simple, like any other purchase you consider, they should justify this purchase.

7. Whenever you have a claim, get your own estimate

Don’t do what most companies do and just take what they tell you is worth it. This is not an open and shut case, just because they say so doesn’t make it so. By getting your own estimate, you can check the insurance company’s estimate and know that you have a fair settlement or you can disagree with your costs and fight for a higher settlement. If you simply accept their estimate, the actual loss involved may cost more, much more in some cases.