Do You Know Your Limits?

Not knowing your limits or understanding your deductible are two of the biggest ways that people lose money on their insurance. As we wrote about before, everyone should take the time to read through their policy so that they really know what it is that they are paying for and to what degree they are covered.

So let’s start with the basics. What are limits and deductibles?

• A limit is the highest amount that an insurance company will pay out for a covered loss.
• A deductible is the out-of-pocket amount you are required to pay for a loss covered by your policy.

But how do these two terms affect how much you are paying for your insurance? It’s pretty simple. The higher your coverage limit, the more you pay; the lower your deductible, the higher your premium. The key to saving money here is to know your limits/deductibles, and to evaluate if they are the best fit for your current situation.

One way to save is to increase the deductible on your policy. Before your next renewal, review your policy to determine whether or not you can afford to pay the greater out-of-pocket expense for an accident. If the answer is yes, then consider increasing the deductible from $500 to $1,000 (or whatever the next step up may be).

While the initial cost of an accident may be greater, you are likely to save money over time.

Similarly, your policy may not be providing you with the coverage you should have due to building renovations, additions or jewellery , fine art purchases not called into your broker.

Don’t find out after a claim, there was insufficient coverage.

Be sure that you are up-to-date on your coverage limits and know your needs.

Call us at (403)270-8822 for your policy review today!

Source – How well do you know your insurance policy?
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