Refinancing Your Home – Part IV
Decision Time – Now that you’ve completed your research and decided on a company, read the policy and verify it contains the coverage you want prior to signing the contract. Additionally, you should be aware and look for two clauses in the contract:
Retain your right to sue
NOTE: Each state of residence varies. For example, Kentucky is a limited no-fault state, which means you give up your right to sue the other party until you surpass a $1,000 threshold of medical bills unless you have permanent disfigurement, break of a weight-bearing bone, etc. This has been the law since July 1975 and the threshold has not changed.
Avoid aftermarket part requirements
NOTE: Some insurance companies may require an additional OEM endorsement, which guarantees your will have original parts replacement on both comprehensive and collision coverage, if available.
NOTE: Most insurance companies will limit the use of OEM parts for a total of 10 years on a vehicle, meaning after your vehicle becomes 11 years old, this guarantee/coverage expires.
The Bottom Line – For my efforts in “shopping” for auto and homeowners insurance (approx 3 hours), I ended up staying with our independent agent; however changed to a different insurance company. Personally, I think an agent to call to take care of your business adds value, but more and more people are not considering that a part of the equation.
In addition to needing to assess and adjust our coverage and limits, the overall outcome generated a savings of $1,250 per year. Yes, I spent 3 hours researching and shopping for insurance; however that equates to over $400 in savings per hour spent – not too bad of an hourly rate.
These savings will be injected back into our family budget, which means that we just need to absorb approximately $100 per month to cover our increased mortgage payment, which will result in shaving 9 years off our mortgage – saving us $91k in interest. Coming up with that $100 per month is much more manageable now.
I wish you happy “shopping” and much luck securing savings for your bottom line!!!