When money is tight, you may be looking for easy ways to save money. One item that can be especially frustrating is your insurance bill each month. You send the money in, but then you rarely if ever use it. You may be tempted to try to go without insurance because it is something that you rarely use. However, insurance is there to protect you from the overwhelming catastrophes.
Should I Cancel Insurance Completely?
The simple answer is no. There are three basic types of insurances you need to have no matter what. You need to have health insurance, car insurance, and home or renter’s insurance. Law requires car insurance and you can choose to get just the bare minimum requirements. If you have a car loan make sure you have enough coverage to pay off the loan.
What’s a Life Insurance Premium?
If you have a mortgage, the company will require you to carry the insurance. Health insurance is also required under the Affordable Care Act, and can protect your from financial disaster. If you have any dependents you really should have life insurance, as well.
What If I Never Use It?
If you never use health insurance or make a claim on your car or home owner’s insurance, that is great. However, it does feel like you may be wasting your money. The simple fact is that you do not know when you will need the insurance. No one wakes up and plans to get an appendectomy or to get in a car accident. No one wakes up and thinks it would be great to be robbed today. These things happen everyday to all over the world, and your insurance is your protection so these events are easier to mange. Insurance makes it easier to move forward.
How Can I Save?
One of the ways you can save money is by increasing your deductible. If you rarely use your insurance, you can set aside money each month to cover your deductible.
With a high deductible health insurance policy, you will pay out of pocket until you reach your deductible. However, you will be covered when you become seriously ill, and you will better be able to manage your bills. You can also lower you car and home insurance policy premiums by increasing your deductible. You need to be sure that you can afford to pay the difference. Another way you can save is by shopping for a new policy every few years. Most insurance companies will charge new customers less for their premiums. You can also take advantage of discounts through your job and alumni association to help reduce costs.
Is There Any Insurance I Can Do Without?
There are some options that you may not need right now. One easy example is cancer insurance, which usually offers a one time lump payment when you are diagnosed with cancer. Unless you have an extremely high chance of getting cancer due to family history, you can likely skip this option. When you are in your twenties, you do not need to purchase long-term care insurance, since you will likely not need it until you are a bit older. Finally, you may not need an umbrella policy when you are in your twenties, because you do not have a large number of assets that you need to protect.
Remember that insurance is designed to protect you. The protection it offers is worth the amount that you are paying in premiums each month. It only takes one accident or unexpected event to put your finances in a tailspin. While it may seem like you are throwing money away, you will find at some point just how much your insurance gives you, including peace of mind. Take the time to review your policies each year to make sure that you have the right amount of coverage for your current needs.