Tips for Caregivers: How to Cut Insurance Costs


Let's face it, running a household is costly and time-consuming. Running two—as many of us find ourselves doing—is exhausting, and doesn't leave a lot of time for loose ends.That's why many of us in in the caregiving generation are likely to be overinsured, or paying for services we no longer need, or not receiving credits we're due.

Why is this so? Well, think about it—when was the last time you had time to pour over your policies and call for competing quotes?

Still, in this economy it's worth doing a little homework, as this is one area where the average household could reap several hundred dollars in monthly savings. (And don't forget—anyone in the family on long-term disability may be eligible for government-subsidized health insurance such as Medicare or Medicaid.) To save you time—since we all know that's the most valuable commodity of all—we've culled the experts' best tips for lowering insurance costs.

1. Car insurance
This is absolutely the place to start, since for many of us, auto insurance is the policy we've held longest and paid the least attention to. And you might be surprised—there's surprising variation in auto insurance costs for the same car and driver.

Get every possible discount: If a traffic violation raised your rates a few years back, ask if it's time to get your good driver discount back. Ditto if your car has antilock brakes, an anti-theft device, etc. If you've moved to a new neighborhood or changed professions, don't forget to mention that, too. Insurance is calculated according to strange, mysterious formulas, and you never know what might cause your rates to drop. And if you've stopped working or lost a job—well, you're probably driving fewer miles, and that definitely lowers your rates!

Raise your deductible: If your car's no longer brand new and you're not worrying about every ding, you can save big time this way. Investigate policies offered by professional organizations; membership in an alumni organization or business group often results in an automatic 10% or 20% discount with group coverage.

Check rates with competing insurers: Make sure to check with any other companies you have policies with (homeowner's, health, etc.). Combining several policies with one company can result in substantial savings.

Next Page: Homeowner's and health insurance [ pagebreak ]2. Homeowner's insurance
Another source of hidden costs. Raise that deductible high. Think of it this way; homeowner's insurance is essentially catastrophe protection. Unless you plan to use your policy to claim small repairs—not a good idea anyhow, since doing so can result in rate increases and even being dropped altogether—then paying higher fees for a low deductible does you little good. So given the low statistical likelihood that your house will burn down or blow away, consider setting aside some savings in case of natural disaster, and then reap the savings now.

3. Health insurance
Sorry, not the place to skimp. One Harvard study found that half of all bankruptcies were due to unforeseen medical expenses, and this is one type of insurance we're all going to need at some point or another. Still, experts say, lots of people are eligible for lower-cost policies they simply don't know about. Here's what to look for:

Employer-sponsored insurance: If your employer offers one, go for it, even if the company only covers a small amount of the costs. The group plans offered by employers are almost always the best bets. If you're not a full-time employee, don't hesitate to ask about the possibility of joining the company policy anyhow. Some companies (especially those with socially responsible employers) will find a way to get you on the policy, even if you have to assume the bulk of the costs yourself or even take a pay cut to make the numbers balance out.

Group plans: These are harder to find than they used to be, but you can find them if you look hard. (You may have to join a group in order to get their insurance.) For example, some unions, churches, and chapters of the Elks, Kiwanis, or Masons offer group health plans, as do professional networking and business groups. Because group plans have to take all members as-is, pre-existing conditions aren't exempted and the coverage is usually more comprehensive than individual plans.

The cheapest approach based on your family's total costs: This approach requires you to pull out the receipts and run some numbers. While a plan with lower monthly fees might sound cheaper, if family members go to the doctor often or need brand-name medications, you can end up paying so much in copays and deductibles that you'd save money with an HMO or other plan with higher upfront costs. On the other hand, if everyone's healthy and no one has problems requiring frequent, regular appointments, a plan with a high deductible and low monthly fees could save you several thousand dollars a year.

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