Friday, February 6

Save Money by Shopping Insurance Policies - Loyalty Means Nothing

I just increased my monthly cash flow by $108!

Since I bought the first townhouse in 2003, I've been fiercely loyal to Farmer's Insurance.  Every time I've added a rental property in Alabama, I've phoned my agent and let him handle the paperwork, no questions asked.

A major focus this year is on questioning every recurring expense I have, personal and business.  Even though my deductibles are $5,000 on each property, the cost of insuring them seems too high.  For one thing, I look at property insurance as disaster insurance:  I don't call my agent every time there is damage to my property.  The insurance is there for two reasons:  in case there is major damage to a property, such as from a fire or a tornado, or if one of my tenants sues me.  Since I take good care of my properties, I think I am a low risk for loss, lower than the average person.  And, I have stellar credit.

Last month I contacted an independent insurance broker and asked if he could save me some money.  The call took about 20 minutes to review the nine properties he would be shopping.  When he got back with me, he was able to offer significant savings on three of those properties.

 I will save $1,306 the first year for the policies I am switching.  That's $108 per month that stays in my pocket.  My deductibles stayed the same, and I actually increased the coverage on one of the properties.

Loyalty is meaningless in the world of insurance.  Last year, I switched my auto insurance to GEICO, and the savings were massive.  Lesson learned:  I will now take a closer look at my insurance rates every 2-3 years.  The effort is painless, but the results are incredible.

10 comments:

  1. I have been wanting to switch my auto insurance so that I can save some money. So I am researching and trying to learn how to shop around for car insurance. This blog was exactly what I needed and I am excited to go and give these things a try and I hope I can save some money. http://www.mattroenkerinsurance.com

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  2. I've heard that sometimes policies change and when your policy is up, you can shop for a new one. As a new driver, it never occurred to me that I would be able to shop for another policy when the current one expires. It is kind of funny what you don't realize when you don't have a prior need for a particular thing. Now I don't feel so locked into a policy's situation forever.
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