10 Insurance Tips for Millennials

By Diane Tait

Image courtesy Pixabay

Those of you who were born at the turn of the 21^st Century were weaned on technology.  That’s why you spend so much time with your noses pressed against your smartphones.  While hi-tech is a wonderful thing, it can also be a two-edged sword if you aren’t careful.  While you twenty somethings may know how to use apps and IoT devices like nobody’s business, there are a few old school tricks that can help you reduce the risks and costs associated with insurance. 

1.      Why do young people need insurance? -  I can still vaguely remember what it was to feel like I was immortal when I was in my twenties.  Like you, I was more interested in where the next party was than I was about how to secure my financial future.  Like it or not, there could come a time when something happens that will make you wish you had purchased renter’s insurance or health insurance for those of you who have neither.  While millennials are the most underinsured adults in the country today, they are the ones who need coverage most.  In my day, we didn’t participate in extreme sports, cars didn’t cost tens of thousands of dollars and people weren’t apt to sue at the drop of a hat.  While you may still be young, you’re old enough to realize if something catastrophic does happen to you, you could be my age before you wind up paying down the debt if you’re underinsured.

2.      How can you reduce the cost of auto insurance? – Other than the cost of owning a car, the cost of auto insurance is significantly higher than it was in my day.  That doesn’t mean drivers in their twenties can’t reduce the cost to insure their vehicles.  The three best ways to reduce cost without watering down your coverage is to increase your deductible, take a defensive driving course, and improve your credit score.

3.      Tech to the Rescue – Since you like technology, another way to reduce the cost of auto insurance is to opt-in to telematics.  Many insurers today are ready, willing, and able to customize your coverage provided they can monitor and assess your driving habits.  Insurance companies that rely on telematics are eager to send you a dongle that you can plug into your dashboard for a few months.  This device will allow them to gauge metrics such as speed, acceleration and braking in real time.  If they like what they see, you can count on a significant reduction in your insurance rate.  If they don’t like what they see, they won’t use this information against you in any way.  That’s the law.

 

Image courtesy Pixabay

4.      Put down that smartphone. -  One of the bad habits that millennials have that costs them money is texting while driving.  Not only is it illegal, it can cause traffic accidents.  A car traveling 70 MPH covers more than 100 feet per second.  Look down at your smartphone for even an instant while cruising the interstate and you could wind up in a wreck.  One of the things that won’t help you reduce your insurance cost is being ticketed or involved in an at-fault accident. 

5.      Ask your insurance agent about available discounts. – Believe it or not, you may qualify for a discount on your insurance if you maintain high grades in school, or if you drive less than 7,500 miles per year.  There are also discounts for paying your insurance premium twice a year as opposed to monthly.  If you have two or more insurance policies, ask your agent if you can bundle them under the same insurer.  That can save you money on both policies.

6.      Use your smartphone to call your insurance agent.  –  The best way to find out what’s what when it comes to insurance is to have a brief conversation with an agent.  Like you, they have a lot of technology at their fingertips.  Independent agents can shop your insurance needs with scores of carriers at the click of a mouse, and they can also program in a variety of options that will make a difference in the price you now pay. 

7.      What’s more important, price or coverage? – Before you haggle over the price of an insurance policy, you need to first determine the correct coverage.  Then you can determine which insurance company can give you the best price on a policy that’s right for you.  Opting for the cheapest policy could put you in a situation where you save a few dollars now only to spend much, much more down the road when you need the coverage most.

Image courtesy Pixabay

8.      Is your side gig threatening your future? – If you’re participating in a rideshare service to supplement your income, take note:  Your auto coverage could be dropped or a claim could be denied.  That’s because working for companies like Uber or Lyft is considered a commercial use of your vehicle which is NOT covered under your auto policy.  Even if the rideshare service offers to provide you with additional coverage for your vehicle, you need to contact your agent to make sure your vehicle is fully insured for commercial use.

9.      Does your current insurance have gaps that could cost you money? – If you own a lot of electronics or your parents gave you an expensive piece of jewelry or art, you may need a rider to cover them in case of loss.  Most renter’s and homeowner’s policies have limits on the coverage of personal possessions.  Better to call your insurance agent to see if an item is covered than to find out it isn’t before it’s lost, stolen, or destroyed.

10.  Consider acquiring disability insurance. – I know you think you’re immortal, but if something were to happen that caused you to become disabled, either temporarily or permanently, the cost of not having disability insurance could severely affect your ability to live independently.  I recently had a young friend get involved in a motorcycle accident that left him in a wheelchair for 6-months.  While his friends and family were able to pitch into keep a roof over his head, he was forced to sell most of the possessions he had accumulated to cover the expenses he was unable to pay while out of work. 

Being young doesn’t mean you can’t get deals on insurance to protect the things that you cherish most.  Now eat your vegetables.

Diane Tait owns and operates A&B Insurance.  To find out more about how you can save money on boat insurance, go to her site.