[November 20, 2008]

Tulsa World, Okla., Action Line column: Ways to reduce insurance costs with any agency

(Tulsa World (OK) Via Acquire Media NewsEdge) Nov. 20--Dear Action Line: TV ads about saving money on insurance make me wonder: How do you really "save a bunch" on insurance? -- M.T., Tulsa.

The Insurance Information Institute's Web site says to review policies periodically with your insurance agent to ensure that they cover all threats and include the latest discounts.

Home insurance: Home insurance comes in two flavors: "actual cash value" (coverage for the home's depreciated value) and "replacement cost" (replacing the home or its roof). In Oklahoma -- where fire, wind and ice damage are possible -- go for replacement cost, but carriers will insist on new roofs before writing these.

Premiums are less if the home's electrical, heating and plumbing systems are less than 10 years old or have been modernized. Brick homes are cheaper to insure, as they are more wind-resistant.

Deductibles, usually $300, are the amount you pay before the insurance kicks in. Higher deductibles lower premiums. Consider one of $500 to $1,000 to save 25 percent. If you are 55 or older and retired, you might qualify for a 10 percent discount.

Rider policies on fur coats or jewelry should be reviewed and reduced or canceled if you have sold or given them

away or their value has depreciated substantially. If you have home security devices such as smoke detectors, burglar alarm or dead-bolt locks, seek a 5 percent premium discount. Some companies cut premiums as much as 20 percent for sophisticated sprinkler systems and fire and burglar alarms that notify police, fire or other monitoring stations. Or ask what systems your insurer recommends.

Auto insurance: After several years of flat or falling auto insurance rates, the average annual cost of auto insurance rose just $9 in 2007, much less than the Consumer Price Index rate of inflation. Drivers with "safe driving records" will continue to get the best rates.

When buying a car, check with your home insurer on what it will cost to insure, as choosing the right car lowers your premium. Premiums are based on the car's sticker price, the cost to repair it, its safety record and likelihood that it will be stolen. Many insurers offer discounts for features that reduce the risk of injuries or theft -- including air bags, anti-lock brakes, daytime running lights, anti-theft devices and air bags.

Higher deductibles of $500 to $1,000 reduce your collision and comprehensive coverage by 30 percent to 40 percent. Companies offer discounts for having no accidents or moving violations for extended periods. Motorists who have recently taken a defensive driving course might also qualify for a cut.

Check into dropping collision and comprehensive coverage on older cars. It might not be cost-effective on cars worth less than 10 times their coverage amount. Don't pay for comprehensive or collision on a car worth less than $1,000 as any claim payment you receive would not substantially exceed your premiums minus the deductible.Submit Action Line questions by calling 699-8888 or by e-mailing phil.mulkins@tulsaworld.com or by U.S. mailing it to Tulsa World Consumer, PO Box 1770, Tulsa OK 74102-1770.

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Copyright (c) 2008, Tulsa World, Okla.
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