When buying a new policy, how many different agencies do you get a quote from? When getting those quotes, how many people do you talk to and how many online tools do you use? When you use those online tools, are you putting in the amount you’re paying for the house, or are you putting in the amount it would cost to rebuild it? Spoiler alert: They’re different amounts.
Five minutes in to our talk with State Farm insurance agent Dereda Porter, we realized we’ve really never done our due diligence when it comes to insuring our home, car, or life — Jesus take the wheel.
The good news is, we’re not alone. Here’s what you’re probably also doing wrong:
1. You Don’t Go for the Bundle Discount.
You’ve probably seen the commercials, but if you’re not bundling your insurance, you really are missing out on deals.
Always shop around, always speak to an agent IRL (not an online tool) and always ask for the bundled rates when you’re shopping. The bundled rates are what you want to compare.
“Even if another company has us beat on car insurance,” Dereda says, “We might have more significant savings for you on homeowners insurance, and it’s the total bundled rate where you can save money.”
2. You’re not Insuring the Right Amount.
When you use an online tool to get a quote for your homeowners insurance, which number are you putting in? The amount you see on Zillow, or the amount the home would cost to rebuild? If your quotes are just based on the first, you’re not getting an accurate quote.
When you’re shopping around, talk to a real person who is going to take what really matters into account. Sure, you may have only paid $70k for your foreclosure, but you’re still going to have to insure your home for $150,000 because that’s what it would cost to insure it. Or, say you paid $2.5 mil for your beautiful horse farm — you don’t have to insure the whole thing, because they’re only taking the home they would need to rebuild into consideration. (That’s a lot of savings for you.)
This is the one time it pays to pick up a phone, or even go talk to a local agent in person.
3. You Aren’t Considering Claims.
So, you’ve had your home for five years, and you think “Wow, I’m paying a lot for insurance, let me see if I can find a better deal.” You find a great deal that saves you $50. Go you, you can buy five margaritas and some fajitas tonight to celebrate.
Flash forward 8 months: A tree falls on your roof, and it’s time to make a claim. Aaand you’re going to wish you stayed with your previous insurance company.
Insurance companies reward loyalty, but they also just don’t know what to think about you when you’re new and already filing claims. Maybe it’s just happenstance, but maybe you’re a bad egg.
Your previous insurer would have known that this is your first claim, and they would have helped you out. Your local State Farm agent would also be able to advise you on what you should do: Should you file the claim, pay for it out of pocket, burn the whole house to the ground and start over? (Hint: the answer is never No. 3).
And don’t think that just because you stuck with your company all this time and they helped you through a claim that now you can shop around for better rates. Most insurance companies are going to wait for three years for your claim to fall off before they even accept you as a client.
It pays to stay local, it pays to stay loyal, and it pays to trim the trees surrounding your house.
4. You’re Not Considering Local Agents.
Why bother when you can just call up a 1-800 number and get the thing done, right? Wrong.
A local agent is the one who will get to know you. They’ll give you that free advice on what to do when you think it might be time to file a claim. They’ll be the same face you can talk to (or cry with) every time you need to, instead of a different person over the phone referencing notes the last person typed into your account.
They’ll see your growing family and know when it’s time to send you information on life insurance, college savings plans, and (even more) car insurance. They’ll even be the ones to help you transfer to a different branch when it’s time to move, and make it as smooth as possible.
Do you have more questions? Maybe you’re in the market for insurance? Contact Dereda Porter for anything you might need.
This post was produced in partnership with Dereda Porter.