How to Get the Most for Your Insurance Dollar
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It's always good to review your insurance policies at least once a year!
Many consumers are looking for ways to save money on their expenses. One area where many people are trying to save money is on their insurance. It is a good idea to review your policies to make certain that you are not paying too much for your coverage or paying for a policy that you do not need. However, it is also important that you maintain appropriate coverage.
Reviewing your policies and comparison shopping can help you save money. But be sure that the policy you choose will provide adequate coverage if you need it. When reviewing your policies, or comparison shopping, make certain that you are dealing with insurers and insurance producers (also known as agents or brokers) that are licensed to do business in Maryland. If you have a question, please
contact the Maryland Insurance Administration.
Here are some general tips to help you as you review your policies:
- Maryland law requires that all owners of automobiles purchase and maintain at least the minimum coverage for bodily injury liability, personal injury protection, property damage and uninsured motorist protection. For specific details about requirements, read A Consumer Guide to Auto Insurance or contact us at 800-492-6116 to obtain a printed copy. Failure to maintain the minimum coverage will result in substantial fines from the
Motor Vehicle Administration.
- Your insurer may cancel your policy for non-payment of premium even if your payment is only one day late. But the insurer must first provide you with 10 days advance notice of the date that the policy will be cancelled for non-payment of premium.
- You can take a number of steps to reduce your automobile insurance premium:
- Make sure that you are receiving all discounts the insurer offers (for example, multi-car discount; good grade discounts for students; accident free discounts.)
- Review your deductible – raising the deductible on your policy can decrease your premium.
- Consider whether you want to maintain comprehensive and/or collision coverage. If your vehicle is older and has been paid off, you may want to consider dropping these coverages since it will reduce your premium. However, it is important to know that if you drop these coverages and your vehicle is damaged in an accident that you cause, or if it is stolen, vandalized or hit by an animal, you must pay for the repair.
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Comparison shop – obtain quotes on a comparable policy (i.e. one that has the same coverage limits and types of coverage). Refer to our
Auto Insurance: A Comparison Guide for Rates or contact us at 800-492-6116 to obtain a printed copy.
- Make certain that you understand all of the “costs.” For example, deductibles, copays and coinsurance. Also, make certain you understand any “rules.” For example, do you need a referral before you can see a specialist of your policy? To find out more information,
visit our website.
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Comparison shop – obtain quotes on a comparable policy (i.e. one that has the same coverage limits and types of coverage).
- Your insurer can cancel your policy for nonpayment of premium; however, under Maryland law, you have a grace period to make that payment. Contact your insurer before your payment is due to find out the details of the grace period.
- If you are considering purchasing a medical discount plan, make certain that you understand that this is not insurance, but instead gives you a discount for certain services at participating facilities. For more information on these plans, refer to
What Consumers Need to Know About Discount Medical and Discount Drug Plans.
- If you have any questions regarding your health coverage, contact the
Health Coverage Assistance Team (H-CAT) for free assistance. We will stay in contact with you as long as needed to help find answers to your questions or address your concerns whenever possible.
- Make sure you are taking advantage of all discounts that are available (for example, multi-policy discounts, having a security system.)
- Consider increasing your deductible. Remember, the higher the deductible, the lower the premium. Before you change your deductible, check with your lender to make certain that the conditions of your loan do not require a specific deductible. Also, make certain that the deductible is an amount you can afford to pay if you do have a covered loss.
- Your insurer may cancel your policy for non-payment of premium even if the payment is only one day late. But the insurer must first provide you with 10 days advance notice of the date that the policy will be canceled for non-payment of premium.
- Even if your insurance premiums are included in your mortgage payment, you have the right to choose your insurer, so you may shop around to find a better rate.
- Your homeowners policy only insures the buildings and other structures on your property and the contents. It does not cover the land. Remember that your coverage amount is not related to the market value or the potential sale price of your home. The key is making certain that you have the appropriate amount of coverage to rebuild your home and replace the contents of your home.
- The cost to rebuild your home following a loss has continued to increase as materials, labor and debris removal costs have all increased. Thus, it is important that you continue to insure your home for the cost to rebuild and replace it in the event of a loss.
- Comparison Shop – obtain quotes on a comparable policy (i.e. one that has the same coverage limits and types of coverage). You can also refer to the
MIA’s A Consumer Guide to Homeowners Insurance and
Homeowners & Renters Insurance: A Comparison Guide for Rates.
- Before you decide to surrender or sell an existing life insurance policy, make certain that you carefully consider the tax consequences of the transaction and discuss this with a trusted financial advisor.
- Your insurer may cancel your policy for nonpayment of premium; however, under Maryland law, you have a grace period to make that payment. Check your policy or contact your insurer before your payment is due to find out the details of that grace period.
How to Get the Most for Your Insurance Dollar
First, take a look at your “
declarations” page. This is the page that outlines your coverage to include the kinds and amounts of coverage you have and how much it costs you. Insurance companies typically mail policy updates and declarations every six months or once a year. Start by reviewing the declarations page to determine whether your coverage meets, exceeds, or is less than your current coverage needs.
Next, research discounts that may potentially save you money. Keep in mind that all discounts may not apply to you and that different insurance companies may have different rules and standards for discount eligibility. Talk to your insurance producer (also known as your insurance agent) or an insurance company representative about the discounts that you may be eligible to receive.
A few common types of discounts are:
- Good Driving Record - Having a ticket on your record may keep you from qualifying for this discount.
- Defensive Education Courses - Completion of a driver safety program or education course may qualify you for a discount. Check with your producer or company first to see what courses they accept.
- Good Student - If you are a student, or if you are a parent with a student-driver in your household, check with your producer or company for this type of discount. Typically a student that maintains at least a B average will qualify for a discount.
- Safety Devices - Devices that lessen bodily injury or property damage as a result of an accident like anti-lock brakes, air bags or automatic safety belts may qualify you for a discount.
- Anti-theft devices - Car alarms, electronic tracking systems and other theft deterrent devices may qualify you for a discount.
- Multiple Policies - If you have more than one vehicle, or bundle your homeowners and auto policy with the same carrier, you may qualify for a discount.
- Renewal Discount - Continuous coverage with the insurer for a specified number of years may qualify you for a discount.
- Employment or Membership Discounts - Credit unions, shopper’s clubs, or alumni association memberships, or your employer may qualify you for a discount. Check with your producer or company. discount.
To learn more about our consumer education and advocacy initiatives, read our
Consumer Publications. These materials provide information about most types of insurance.
If your community group, HOA or organization is interested in a virtual or in-person presentation or speaker, contact Associate Commissioner Patricia Dorn at
patricia.[email protected] or
click here.
