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How to Save on Insurance by Switching Companies

6 minute read

Joshua Williams

By Joshua Williams

Saving money is always a major topic for discussion that everyone loves to take a part in. Whether you saved by cutting coupons, finding discounts online, cutting back on gas usage, or using hand me downs, saving money is greatly appreciated.

When thinking of ways to save money, very few people think of comparing insurance rates. Every year when your insurance is resetting, see if there are better deals out there. Sure, the thought of comparing companies and their prices may seem like a long and drawn-out task. However, it  can be very beneficial when it comes to having some extra money in your budget to take care of other needs or desires.

Having to renew your insurance may seem bothersome. Instead of focusing on the time that it takes to get this done, think about the money that can be saved in the process. The opportunity to save money is always worth a little bit of extra time.

Why Compare?

As with the prices of food and gas, comparing prices for insurance can be extremely beneficial.

Policy features with some companies are sometimes far less expensive with others. In some cases, insurance companies make it a point to include little add-on features and deductibles to their policies. They are not necessarily important (or even needed) for your policy. By making these features standard, it increases the cost. So, in many cases, money is spent unnecessarily.

It’s also very important to analyze your insurance when it’s time to renew because many companies add fees as the year progresses. Showing loyalty to a company doesn’t always benefit you. In the world of insurance, it’s sometimes better to switch companies to get a better deal. There is an opportunity here to take advantage of new perks that companies might have on offer for new customers.

The Ease of Comparing

Near the end of your insurance policy term, comparing insurance rates to possibly get a better deal is very easy. It’s often as simple as filling out an online form. Taking a few minutes to fill out one form will allow you to compare the insurance rates that various companies have to offer. Checking quotes for the lowest possible rates will assist you in finding the ideal policy to fit your individual needs. Hopefully it will be for a new, lower price.

Before You Go…

Although it’s always a good idea to compare your old service against potential new providers, don’t just jump ship immediately. Give your current insurance company a call. Tell them you’re shopping around for a better deal and see if they can come up with anything. Ideally, you’ll be able to take those comparison quotes and use them to your advantage.

Seriously. Go ahead and tell your current provider that their competition is offering the same coverage for 15% less. Give them a chance to match that price, but be willing to walk away if they refuse. In some cases, your current provider will bend just to avoid losing your business altogether.

Check For Discounts

Insurance can be complicated. Especially when you consider everything you might need it for. There’s home insurance, auto insurance, life insurance, health insurance, and even pet insurance. Each of those types will carefully consider a number of factors before offering you a price. Those factors can matter a lot.

Take car insurance, for example. Your daily commute to work plays a big part in your cost. Spending two hours in the car every week day will cost you a lot more than if you work around the corner. Better yet, if you routinely walk or take transit to work, make sure your insurance company knows. Some insurance companies will also offer discounts if your car has advanced anti-theft technology or if you use snow tires in the winter.

Home insurance policies typically have the same structure. You’ll pay more if your house is heated by oil instead of a more efficient and safer furnace. You might get a discount if your house has extra security features, like an alarm system or cameras. However, you probably won’t get any of these discounts unless you ask for them.

You can sometimes get additional discounts based on your personal history. If you took a driver’s training course, qualify as a veteran, student, or senior, or have completely paid off your mortgage, you might be entitled to a discount.

Increase Your Deductible

For some insurance types, increasing the deductible will reduce your monthly premiums. It’s a pretty simple equation — the less you are willing to pay out of your own pocket in the event you need to make a claim, the more your premiums will be.

It’s best to carefully consider your own finances when making this decision. For example, how much can you really afford to pony up if someone rear ends your car or a tree branch crashes though your roof? $500? $1,500? Maybe you don’t have any room for error in your budget at all, and need a super low deductible.

Whatever you decide, you should know that you can save a bit of money on your premiums by switching to a company that allows you to increase your deductible. Just be aware of what the decision will cost you if you do ever need to make an insurance claim. It’s a gamble, either way. You just have to decide how big of a bet you’re willing to make.

Customize Your Coverage

While you’re comparing offers from different companies, remember that insurance policies aren’t always one-size-fits-all. You may have to actually call and talk to a human (instead of filling out forms online), but you can probably customize your coverage to fit your needs.

One common example is removing collision coverage from your car insurance. We don’t advise this if you drive a new car that you’re still paying off. But if you’re touring around in an old beater, consider dropping the part of your insurance that will pay to get it fixed. Let’s be honest, it’s probably not worth fixing anyway.

You can do similar things with home insurance. If you don’t live anywhere near water, make sure you’re not paying for flood insurance.

Bundling Your Insurance

One of the best reasons to switch insurance companies (and save money in the process) is to bundle all your products together. If you have separate companies to provide you auto, home, and life insurance, ask yourself why. Most insurance companies will offer a decent discount if you bundle two policies together. Add in a third or fourth (life or pet insurance?), and the discount will probably get even bigger.

When comparing potential providers, check to see which companies offer the largest discount for bundling your services. If you’re going to be paying for multiple policies anyway, you might as well keep them together and pay less in total.

Out with the Old

In some cases, consumers have the impression that it’s ok and probably better to stick with a company that they are already familiar with. Insurance companies, especially the big ones, are well aware of the thought pattern that many consumers possess. For this very reason, these companies are comfortable raising rates and tacking on unnecessary fees to their long-time customers. Since they have been so successful at having large clientele based on the loyalty of their customers, it does not benefit them to lower their prices or offer savings for their most dedicated customers. It is very important that consumers begin to pay attention to what’s really going on and check out what some of the other insurance companies have to offer.

The truth of the matter is that every case is different and there are always great possibilities that there are opportunities to save money. Sometimes showing an insurance company that you have other options will cause them to make better deals.

Since it is custom that insurance coverage does not last for more than a year, it is extremely beneficial to use the opportunity to make sure that you are getting the best deals. In the cases that the best deal is not offered by the company with the soon ending coverage, changing companies or policy details will work out best for the consumer.

Insurance Agent Pointing to Insurance ApplicationShutterstock
Joshua Williams


Joshua is a freelance writer with years of experience blogging about business and finance, and a whole host of other things too. When he's not writing, he enjoys camping with his dog, a golden retriever named Oakley.


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