Tuesday, January 5, 2010

How to Lower Bills part 2 - fixed Bills- car insurance

Yesterday, I was telling my DH about the cutting bills question and my answer. A funny thing happened. My first response to the cutting bills question had to do with variable expenses - ones that fluctuate. His first response was on fixed expenses - utilities, insurance, mortgage, etc. We had a good laugh because he is in charge of fixed and I am in charge of variable expenses in our family so we saw that question in a different light.

However, as I have been mulling this over, I think that in many instances - not all- that they can be handled in the same way. Keep in mind the questions 1. Is it possible to do this cheaper? 2. How?

Let's take a look at a bill that is considered more fixed. Car insurance. Let's use the questions. Is it possible to do this cheaper? Yes. I know you may not believe me but it is true. How? Keep reading.

Did you know that with one phone call, your insurance agent can lower your insurance rate? No lie. You just call them up, tell them you are looking around, and if they want to keep your business that they better give you a more competitive rate.

We did it, and had our agent scrambling. She got quotes from several other companies that she uses. We even found out that Nationwide started another company, with a completely different name, for the purpose of offering cheaper insurance! I'm not lying.

When you throw in a multiple car discount along with a home insurance policy, you can get even better rates. If you have teenagers, the good student discount helps out a lot. Also, driving in such a way that you don't get tickets or in accidents is very cost effective.

Here is another tidbit you may not know. If you go on vacation, you can call your insurance company and uninsure your car for the time you are gone. We had a car that we weren't driving anymore, so we didn't need the collision and liability insurances. We did want it insured in case it was vandalized or stolen. So for $7/mo. we were able to get those things covered.

So then you ask, can I get it cheaper? yes. How? Share a car, and the expenses, with someone. You could also drive older cars that are cheaper to insure. Or, you could give up your car all together and ride public transit or get a bike. Your cost is free, after the bike. But you could probably get a bike for free too. (Not that I am saying this is very viable for most Americans, but it is a possibility.)

I am convinced that with most things there is always a way to get it cheaper, even a little bit. It just takes a bit of asking and information.

**Real story. My dad used to sell insurance. I was his summer secretary so I saw a lot of people come in and out of his office. One time, I heard my father quote a man $700/mo. for car insurance. I couldn't believe it. I asked my dad if the company really wanted that much for insurance. My dad said that he had some leeway with the quotes he gave.

He knew this guy's car was impounded for D.U.I. and not being uninsured. This guy was trying to get his car out and needed to show proof of insurance. He also didn't want to shop around for multiple quotes. My dad knew that this guy was a huge risk and that after one month would default on his policy. Not a good thing for the company or my dad's commission.

So my dad jacked up the price and figured if the guy wanted it badly enough from him he would pay a lot of money, and the company would make some money for taking the risk. You know what? That guy paid it and the exact thing happened that my dad said would happen.

My point with all of this is that your insurance agent has more power then they let on. It takes a little nudging a.k.a negotiating, shopping around, being informed, and being willing to walk. But it is worth it. It could save you hundreds of dollars every year.

**The picture is of my brother-in-law. Pretty funny huh?


  1. Hey Jen!
    As I was reading the answers/solutions you and Marcus had for each other for trimming the fat (so to speak) and you each chose the part under your care...I laughed because it would be the exact opposite at our house: Hoss would look at me and say, "CUT YOUR SPENDING!!" and I would probably look at him and say, "Sell the horses?"

    You guys are doing GREAT...

    (love your blog, by the way)

  2. Thanks B! It is a tricky balance.:) Thanks for the comment!