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Auto, home, renters, life, disability, health, umbrella, pet, and travel insurance. Carry the coverage you need and stop overpaying for it.
If one parent stays home with your kids, put life insurance on that parent too. Losing them would leave you paying for the childcare, driving, and housework they handle now, often for a decade or more. Price that work, multiply by the years until your youngest is grown, and buy term life insurance that covers the total for those years.
When your teen driver goes on your car insurance policy, ask for the good student discount at the same time and send a recent report card or transcript. Many insurers cut your premium for a B average or better, but they can’t apply the discount until they see the grades.
After a fire or break-in, your insurer pays for the belongings you can list and back up, and a list written from memory leaves gaps. Record a room-by-room video of your home this weekend, with drawers and cabinets open, and keep a copy in the cloud, not just on your phone.
Cancer, critical-illness, and accident policies pay only for the diseases or injuries they list. Before you buy one, compare your health plan’s out-of-pocket maximum with your savings. Then put that premium toward cash that covers a year’s maximum and disability insurance that replaces your paycheck, since neither depends on which illness or injury you get.
If you finance a car with little down, gap insurance covers what you’d owe beyond its value if it’s totaled or stolen. Buy it from your auto insurer, where it usually costs less than the dealer’s version and carries no loan interest, though the payout may be capped. Drop it once you owe less than the car is worth.
Medicare open enrollment runs October 15 through December 7, and if you do nothing, your drug plan usually renews with whatever your insurer changed for next year. Enter your prescriptions and pharmacy in Medicare’s Plan Finder and compare total yearly costs, not just premiums. If another plan’s total yearly cost is lower than your plan’s, switch by December 7.
Standard homeowners and renters policies don’t cover flood damage. A new policy from the federal flood insurance program doesn’t take effect until 30 days after purchase, unless you buy it while taking out or refinancing a mortgage. Get a flood quote this week, so the policy is already in force when the next big storm arrives.
Letting your health plan roll over at open enrollment means buying next year’s coverage without checking next year’s prices. Before the window closes, add 12 months of each option’s premiums to what you’d expect to pay out of pocket, and compare the totals. Then confirm your doctors and prescriptions are still covered.
The basic life insurance that comes with a typical job pays about one year’s salary or a flat $20,000, and it usually ends when the job does. If anyone depends on your income, work out what they would need without it and buy your own term policy to cover that amount.
Raising your auto and homeowners deductibles cuts your premiums every year, but it only works if you could pay the higher amount tomorrow without borrowing. Get a quote at a $1,000 deductible on each policy, and make the switch only if your emergency fund could cover both deductibles at once.
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