A lot of people take a "if it’s not broke, don’t fix it” approach to their car insurance. They sat down a few years ago, did the leg work, secured a policy they were happy with, and are perfectly fine with never thinking about it again. It’s understandable; insurance isn’t the most thrilling thing to spend your time on.
But at Staebler, we don’t think you should be satisfied with a policy that is just "fine.” We think you should always have the best deal possible and that’s why we recommend you regularly review your auto insurance policy.
Auto insurance is a fluid thing. The market is constantly changing with insurance companies developing new policies, packages, and deals. Your personal situation is always evolving too, and that plays a major factor in what kind of policy you should have and how much you should be paying. What might have been a great deal four years ago might not measure up today. That’s why it’s important to occasionally sit down and review a few key factors to make sure you’re getting the most from your policy.
RISK PROFILE: This might seem like an odd question, but how likely is an accident in your future? Obviously, it’s impossible to know for sure, but you can make some basic assumptions. Start with simple facts like your driving routine. Do you rarely drive and only use the car a handful of times a week, or are you a daily commuter who spends at least two hours on the road everyday? Are you the only one in the home who uses the vehicle, or do you have a spouse or teenaged children who frequently use it? Where do you live? If you’re frequently traveling dark country roads or packed areas of the city, you should consider the possibility of a deer strike or fender bender.
Your risk level will affect both how much insurance you should be looking for and how much it will cost. If you can prove that you are a reliable driver with a very low risk profile, it’s only natural that you should be able to get a better deal on your insurance. If your situation has changed and your risk profile is higher, you should pursue a better level of protection for your dollar.
If it’s been a few years, it’s entirely possible, even likely, that your risk profile has changed since you started your policy. Maybe you’ve taken a job closer to home, or retired and no longer have a commute to grind through every day. Maybe your family has grown up and you need a little more protection for your teenaged children getting behind the wheel. Even if your situation is the same, if you’ve driven several years accident free without any updates to your policy, you should talk about it with your broker and see if you can find a better rate based on your consistent performance alone.
LIABILITY LIMITS: Liability car insurance is mandatory in Canada. In Ontario, the minimum coverage amount is $200,000. You might think that is all you need, but finding the best auto insurance isn’t just about finding the cheapest policy you can, it’s about finding the best value for your dollar. $200,000 sounds like a lot, but medical and property damages can quickly dwarf that amount in a serious accident. Increasing your total liability limit can be a very savvy move. It is often less expensive than you would expect and can even be purchased as part of an umbrella policy that will protect you in many other ways, providing way more value for your monthly premium.
The opposite can also be true. If you initially signed your policy with a high liability limit and feel like it is no longer necessary (you don’t drive as much as you used to, or are looking to save a little money), it might be time to lower it. This will lower your monthly premium to something a bit more in-line with the level of protection you feel you need.
Regardless if you feel the need to change your liability limit, understanding exactly what your auto insurance is protecting you with is an important part of reviewing the value of your policy. It’s possible you’re leaving a lot of potential value on the table.
VEHICLE'S VALUE: Speaking of value, another thing to watch out for is the value of your vehicle. As it depreciates over the years, a policy that made sense a few years ago may be excessive now. If the realistic value of your vehicle is only in the low thousands, it doesn’t make sense to carry a high premium that will eclipse the same value over a couple of years of paying.
In the same vein, it’s important to periodically revisit your deductibles. The higher your deductible is, the lower your monthly premium. But you’ll also be on the hook for a larger chunk of any repair bills in the event of an accident. Deductibles are something you should come back to often as the conditions of your life and vehicle change to find the right value. If you’re not sure what that is, your broker should be able to help you find the right balance.
CHECK FOR DISCOUNTS: Something you should revisit from time to time are what kind of discounts are available. People often leave money on the table simply because they don’t know what other opportunities were available to them. Insurance companies are constantly putting together new deals to entice business and it is in your best interest to play the field. It isn’t just new deals either, it’s entirely possible that you’re eligible for discounts now that you weren’t when you first signed your policy, all you need to do is ask.
ARE YOU EMPLOYED HERE? Local employees can receive an extra discount through Group Rate Auto Insurance.
Do you have multiple vehicles? Is your present policy giving you a discount for having them under the same coverage? Multi-vehicle deals are common so if you’re not receiving one you better find out why! Same goes for multiple policies. If your automobile insurance goes through the same company that holds your home insurance policy, it’s likely there is a deal there. This isn’t even looking at all the limited time offers and conditional discounts for things like a clean driving record, or snow tires installed throughout the wintery months that might be available.
The best way to find these deals is to talk to your broker. Your broker works for you, not the insurance companies. Their number one goal is to find you the best deal possible and will pull out all the stops to make that happen. If you haven’t reviewed your automobile policy in more than two years you’re probably missing out on either extra value or extra savings.