This is a guest post from Manarin Investment Counsel’s Don Davidson on Auto Insurance.

Following the birth of our son six months ago, my wife and I took a hard look at our family budget to see where we could tighten things up and save some extra cash.  One area we looked at closely was big ticket expenses we needed to have such as our auto insurance coverage. 

We had been with our current provider for several years, had no complaints about the service but we figured it would be worth it to investigate current rates. 

Before making calls, I read up on ways that we could save some extra money and sought out other smart people in the personal finance world.

You’ve heard the saying, “Invest your time before you invest your money” – well, in this case investing my time resulted in more money to invest because the difference between the highest quote I received (AAA) and the lowest (Progressive, who I went with) was $600 per year.    

Here is how I did it:

1.  Make Sure Your Coverage Doesn’t Overlap with Other Memberships  Since it was already covered in other memberships we had there was no reason for us to include emergency road service or rental reimbursement on our policy.  All other coverage amounts remained the same. 

2.  Raise the Deductible Up To Your Comfort Level    To be honest I hadn’t changed my deductible since I was in college so I was amazed at the amount I saved on my Comp and Collision by increasing it to $1000.  The key point here is to NOT increase your deductible just to save a few bucks – make sure you have that savings cushion in place so that if you were in an accident you could pay that amount.

3.  Shop Around But Stick With the Major Providers  I’m all for seeking out the best deal but I have no interest in doing business with some off brand insurance company that could potentially go out of business and then not be able to fulfill my claim if needed. 

The companies I contacted for quotes were: AAA, Allstate, Geico, Progressive and State Farm.

4.  Understand You Typically Cannot “Negotiate” Auto Insurance  I tried but soon discovered that the companies were not going to budge after they had provided me their quotes.  This step was mostly about me asking the right questions and being fully aware of all the benefits – i.e. premium reductions – offered by each company and those I was eligible for.

One last thing before I close this out…

Some insurance companies will punish you heavily if you or anyone on your policy has been in an accident in the last few years.  My wife was in an accident 2 years ago so each one of the quotes I received came with an accident surcharge added on.  Had that accident not been on our record then the most expensive quote I received from AAA instead would have beaten the lowest quote I received from Progressive by over $100 thus saving me even more money. 

You can bet that in a few years once that accident is not factored in I’ll start this process all over again.

Give this a try and let me know how it works out for you. 

Visit us at Manarin.com.

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Photo Credit: Andrew

Life insurance is a key player in any financial plan for those who need it until their living estate puts them in a position where they no longer need the coverage. 

In other words, life insurance is designed to provide to your beneficiaries, if you die, that which you will provide if you live.  Most of us live to see our beneficiaries grow to financial independence, at which time you no longer need life insurance.

Plain and simple:  Life insurance has nothing to do with any type savings plan and has only one purpose – to replace income. 

If something were to happen to you or your spouse and there is no loss of income, there is no need for life insurance. 

But on the flip side, if the income from you or your spouse is a necessity then you better have life insurance.

Simple isn’t it?