I recently decided it was time to examine our expenses to see if there were any ways to eliminate or reduce some of them. The impetus for looking at our cash flow was adding one teenager to our auto policy and having to add another one late next year. We were astonished by the rate increase by adding one teenage driver to the policy. Another reason it was a perfect time to look at this was because of current interest rates and whether we could/should take advantage of the lower rates.
So, I began a crusade to see if and how much I could save by switching companies. Could I find a lower insurance cost given the same coverage while continuing to receive great service? Without going into the details of the process, it was, for the most part, relatively painless. Many of the forms could be filled out online. Some were more detailed than others, specifically asking for prior claim information like dates and amounts which took a little digging. Some required follow up conversations with licensed agents of the companies to input information and apply discounts to arrive at the policy cost.
What my research revealed is that there is significant variance between auto and homeowners quotes from insurance companies- anywhere from as little as 10% to much higher savings from the six companies I received quotes from. It was interesting that a few of the companies I had researched had ads during the Super Bowl and that each of them advertise heavily on TV.
The result of this roughly seven hours of legwork was an astonishing savings of 65% compared to our current policy for the same coverage. Yep, you read correctly, 65%. Hundreds of dollars in savings per month. It seemed so incorrect that, while going through the process, I had to look at the new quotes multiple times to make sure I input the information correctly and wasn’t missing anything.
I’m not sure whether this makes me happy or mad. Yes, hundreds of dollars a month in savings was uncovered, but I also feel overcharged during much of this relationship and am kicking myself for not having done the research earlier. I had intended to do this research last year but, like many things, kept putting it off. Since I had been with this company for over ten years, and had always received good service, I believed that my insurance rates were probably “in the ballpark” with other firms. I could not have been more wrong.
I believe most people do not take the time to research options and potential savings in their expenses. We are busy, time and circumstances often change rapidly’ and people often don’t take the time to think about identifying potential savings. Many probably believe it is not worth the effort. Review your own and your clients insurance coverage and other expenses for improved cash flows. Use my example to show clients that the process is definitely worth the effort.
The comparison process needs to be done every so often, particularly when there are changes in your situation. In our case, we were adding teenagers to the policy, but there could be any number of changes that warrant research and making a change. Often, just the passing of time, if policy rates rise sharply, is enough to make a change. Some experts recommend researching options every two or three years.
Imagine if your clients could save hundreds of dollars a month from cutting various expenses and how this could help them save and invest more.
Have a great week!
Build your business wisely.