Top Tips Thursday #2 - Saving on Insurance

I have to say, Insurance is one of those somewhat annoying necessities in life. Be it life insurance, income protection insurance, car, health, contents...

Because insurance is so popular, and there are so many providers, it means that there is also a variety of ways to save yourself a bit of money, whilst not compromising on the level of cover you're getting. In saying that, it pays to shop around for price and value.

As a couple of examples, even this year we've saved money in several ways. As my husband is the sole earner of the family, we have some reserves in our savings account should he get sick, or something happens to his job. But should it be more permanent or long-living than that (ie several months), we thought it was important to get some income protection insurance.

We managed to save 35% on our premiums for it, but having it deducted from his superannuation fund - we contribute a tiny bit more to his super, and it comes from his super. And it's pre-tax, so we save the tax component of around 35% on the income protection insurance, or around $30 a month.

Health insurance - do you really need obstetrics cover? Have you remembered to take it off if you've finished having children? You'll probably save at least another $20 a month. If you're young and fit, do you really need top cover? Do you just need hospital cover to save you on any government taxes, or just the basic cover so your dental and other preventative checks are covered? You could save another $40 a month. We just have basic cover, though we have considered even scrapping that, and simply getting hospital cover, and saving the $50 in premiums each month to put towards our dental checks separately to the health fund.

Car insurance - In NSW, there is the Motor Accident Authority, that will compare greenslip (CTP) prices for you. I'm sure there is something similar in other states, and if not, compare the top 6 or so insurance companies and do some quotes online, and compile them in a spreadsheet or piece of paper. Our "6" is due for renewal next month, and although I compared prices last year, I've still managed to save $40 this year by switching to GIO, instead of the NRMA. Last year the NRMA was cheaper, but not this year! I'll probably still call NRMA and see if they'll price match, but regardless, I'm not overly brand-loyal in that regard.

Likewise, our comprehensive insurance is also due for renewal, and again, I did a few online quotes with NRMA, AAMI, Bingle and GIO. I will save $120 by switching to GIO, possibly a little more if we go the CTP and comprehensive insurance together. Surprisingly, Bingle was more expensive for the "6". Again, I shopped around last year, but things change in a year, and this year GIO was cheaper than NRMA, despite our multi-policy discounts.

We have a station car for hubby to use to the station, running around town and the odd trip to work. AAMI had previously been our insurer, but a new-ish company to the market - Bingle (underwritten by AAMI), was seriously $300 cheaper last year!! The a car that is 9 years old, and is relatively low risk.

I find some insurers "prefer" to insure some cars over others as they're typically lower risk, and therefore the premiums will be lower, so it pays to take this into account if you're buying a new car. Also, don't forget to check what your car is really worth too. Places like Redbook, or even the car classifieds, can tell you typical used car prices similar to yours. If your car is over-insured, it will cost you more in premiums.

Building and Contents - I'm just in the process of checking out our Contents insurance now, but doing a brief shop around, what we already have with NRMA is already the cheapest, so it's not going to pay to change, having said that, I also think we're grossly under-insured for contents (by at least half!), so the price savings might change.

By using the tips above, and spending an hour or two researching, in the past 12 months alone, I've saved over $1,000 in insurance premiums.