Many policyholders might be overpaying for their insurance without realising. With a few key factors, you can identify whether your current policy is cost-effective and provides adequate coverage.
Understanding your insurance plan: what you need to know
Before determining if you’re overpaying, it’s important to understand your insurance plan. This includes knowing what’s covered, what’s excluded and whether your premiums match the level of coverage you need. Insurers often structure premiums based on your risk profile, which includes factors like age, location, vehicle type, uses, users and previous claims.
Types of insurance plans: a quick overview
– Car Insurance: Covers damages to your vehicle in case of accidents, theft, or natural disasters. Comprehensive insurance offers the most protection, while third-party insurance only covers damage to other people’s property.
– Building Insurance: Protects the physical structure of your home against risks like fire, flood, and storm damage.
– Home Contents Insurance: Covers the loss or damage of items within your home due to theft, fire, or other events.
– Portable Insurance: Provides cover for your laptops, cellphones and other mobile items or jewellery.
Signs you’re overpaying for Insurance
Premiums that seem too high:
- If your premiums seem disproportionately high for the coverage you have, this is a sign you may be overpaying.
- Factors such as how long you’ve been with an insurer (with no claims or minimal claims) should ideally lower your premium when you quote, but this isn’t always the case.
- The longer you maintain a claim-free record, the lower your premium should be due to the reduction in your risk profile. However, staying with the same insurer for years without claims can still expose you to multiple policy revisions that usually increase premiums by at least 10% annually. To keep costs down, it’s advisable to keep shopping around every three years.
Inadequate coverage for what you’re paying
- Are you paying for services you don’t need?
Some policies may include extras such as car hire, extended warranties or excess waivers, which you might not need but are paying for.
- Insufficient coverage in critical areas
In some cases, you may be underinsured in essential areas, such as underestimating or overestimating the value of your home contents. Alternatively, you might have moved to a more secure area but haven’t updated your address yet.
- Incorrect underwriting
Inaccuracies in property construction details, security measures, or policy terms can cause insurers to quote based on a worst-case risk scenario, unnecessarily increasing your premium.
How to avoid overpaying for your insurance
Review your policy regularly
- Understand the fine print
The terms of cover and underwriting information should always be understood and correct to ensure accurate premiums.
- Ask for a detailed policy review from your insurer/Insurance Advisor
Request a breakdown of your policy to understand what you’re paying for and ensure it aligns with your current needs.
- Consult an independent advisory firm such as Curemed
Independent advisors, like Curemed, help determine whether you’re overpaying for your current insurance and provide comparative quotes to recommend a policy suited to your specific profile and unique needs.
Meet Curemed’s Insurance team!
Curemed’s team of short-term insurance specialists offer comprehensive reviews of your current policy to ensure you’re always receiving the best value for your coverage, because we’re #alwaysthereforyou.
Comparing Insurance Providers and Plans
- For example, when comparing car insurance from Santam versus King Price, individuals can assess which provider offers better value. Santam may include broader coverage at a higher premium, while King Price’s unique sliding premium structure can help reduce costs over time.
- Explore additional insurance articles
Working with an independent insurance advisor
When it comes to selecting the right insurance, having an independent advisor can make a significant difference. At Curemed, we specialise in helping clients navigate the complex world of insurance to find solutions tailored to their unique needs. Here’s how we do it:
- Personalised Consultation: We begin with a phone call to understand your unique circumstances, preferences, and financial goals. This allows us to gather the essential information needed to recommend the most suitable insurance options.
- Wide Range of Options: As an independent advisory firm, we have access to a variety of insurance providers and plans. This means we can present you with multiple choices rather than being limited to a single company’s offerings. We focus on finding plans that fit both your needs and your budget.
- Objective Guidance: Our team is committed to providing unbiased advice. We analyse the pros and cons of different insurance products without any conflicts of interest, ensuring that your needs are always our top priority.
- Comparative Analysis: We help you compare different insurance plans based on coverage, costs, and additional benefits. This comprehensive analysis empowers you to make informed decisions that align with your unique requirements.
- Ongoing Support: Once you’ve selected a plan, our services don’t end there. Curemed provides ongoing support, assisting you with any questions or claims that may arise, ensuring you feel confident and supported throughout your insurance journey.
When using Curemed, you gain access to expert insights and personalised service, making it easier to secure the best insurance coverage suited to your specific needs.
Co-written with Curemed’s very own short-term insurance expert!
Sharolene Cronje, Short-term Insurance Team Leader.
Disclaimer: Terms and Conditions apply. This blogpost and the information contained within it is intended for information and consumption purposes only and does not by any means supersede the Rules of the Scheme. In the event of any discrepancy between this mailer and the Rules of the Scheme, the Rules of the Scheme will prevail. Curemed is a licensed financial service provider with the FSCA, FSP 44098.
