January is the time for clean slates, fresh starts, and new beginnings, but it can also be a time to take measure of where we are at present, professionally, personally, and financially. For many of us, that last one, the financial, can be rough. Previous ProfHacker posts have encouraged readers to explore different kinds of personal finance software and some of the many budgeting apps such as Personal Assistant that are on the market as ways to manage their finances. We’ve also discussed how to deal with irregular expenses, retirement plans, and Flexible Spending Accounts as ways of saving money for both the long-term and the short. In the spirit of these posts, I’ll make another financial suggestion: review your insurance coverage, in particular, your auto and home or renter’s insurance.
When I moved into my first apartment, my parents encouraged me to take out a renter’s policy. Like many young adults, I chose the path of least resistance: I met with their insurer and signed up for the policy that he recommended. When the time came for me to insure a car, I called him up and took out a policy. When I moved, I chose a local agent with the same company. While I was perfectly satisfied with the service that I received, I didn’t realize that I made a huge mistake and continued it for many years. This mistake probably cost me a great deal of money. What was my error? I didn’t shop around.
I had plenty of ways to rationalize my neglect. I was busy. I don’t know much about insurance. I’m not good with numbers. I liked my agent and felt a kind of loyalty to him. I hate calling people on the phone and asking about these kinds of things. . . .
But finally after seeing one too many television commercials, I decided to see if I could, in fact, save money. It took me maybe all of thirty minutes and zero phone calls. In fact, everything I needed was online. The results of my half-hour of web-surfing? An equal policy (in terms of deductibles and coverage) for a full 40% less than I had been paying. I was stunned. Needless to say, I made the switch and haven’t looked back.
But I do continue to look sideways. That is, when my policy comes up every six months, I have compared quotes from other agencies to make sure that I still have the best deal. So far, so good.
If you are interested in comparing rates, there are a few ways to go about it. Mint.com offers its users a rate comparison on its site, and AAA offers a similar service for its members. If you don’t use Mint and don’t belong to AAA, then there are still many websites that will assemble free quotes, but do be careful about which of these you choose since most require you to enter in a bit of personal information (address, birthday, and sometimes social security number). Make sure that you are visiting a secure and reputable site before giving away your details. Finally, if you aren’t averse to making a few calls, you can also dial up local agents and request quotes directly over the phone.
Best case: you might learn that you can save yourself money. Worst case: you might learn that you really do have the best deal for your car/house and your family. As far as a downside goes, that’s a pretty good one.
[Creative Commons licensed image by Flickr alancleaver_2000]
