Insurance: Tips to save on your insurance

By John Grant It doesn't matter what time of year it is, those insurance bills just keep on coming. If you have had a few arrive recently at the same time the credit card has taken a hammering over the break, you might be thinking of how you could save on those insurance costs. Firstly, premiums and coverage need to be looked at together. You can buy a cheaper policy, but you could not get the coverage you need. Have a look at our coverage pages and look for those companies we have scored highly on policy coverage - then check their premium cost. That will indicate value for money. If you look at an example of a contents policy for our 'family' scenario in a profile area that roughly matches where you live - we are using the Auckland area of Papatoetoe in what follows - then the premium for the products we  reviewed range from $446 (State - Essentials) to $979 (NZI Supersurance). The difference in the product scoring is 47% (State - Essentials) to 68% (NZI Supersurance). First, find your policy and see how it's coverage scores in our review. Then compare prices for similar rated products. This will give you a solid basis to compare to similar products. In the above example the State Essentials product provides cover only for specified events, whereas the NZI product is much broader and provides for most accidental loss or damage. You can generally save further by doing some of the following:

1. Take a higher excess - insurers will usually offer discounts for a higher voluntary excess
2. See if there is cover that you do not need. Some policies have optional cover that is automatically included unless you specially request not to have it.
3. Check for other discounts that you may be entitled to, such as age discounts for over 50 or 55
4. Having all your insurance with one provider may qualify you for a discounted price.
5. Make sure that you have the correct level of cover. Under-insurance can be devastating and cost you premium paid without getting cover for things you need. On the other hand, having too much insurance is a straight waste of money. All companies offer guides on setting the correct level of cover.
6. Pay your bills annually in advance, rather than by installment. While a few companies do not charge extra for this, usually additional cost is around 10%, making the effective finance rate much higher.
7. Check the premium consequences before making a 'small' claim. If you are paying both the excess and a higher premium next year, then it may not be worthwhile to claim for some lower-valued items.
8. Shop around and compare. It is a competitive market. Our pages are a good place to start, to narrow down who to get quotes from.