Keeping New Year’s Resolutions May Lower Your Insurance Costs

By on March 8, 2017

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While the dusty treadmills are evidence that many people are not sticking to their New Year’s Resolutions all year long, perhaps they would try a little harder if they knew that keeping some of those resolutions could save them money.

Insurance is the safety net to protect you and your loved ones from financial burden caused by serious accidents, health issues or worse. Insurance takes care of the financial end of those problems so you can focus on everything else.

Not only is it important to get the right personal and life insurance coverage to fit your lifestyle and wealth management needs, but it is important to live a healthy, safe and financially responsible life which makes you look good to insurers. Keeping those resolutions to lose weight, quit smoking or drive safer could save you money so you can look forward to a long and bright future.

7 Resolutions That Could Save You Money on Insurance

Lose Weight – Lower Your Life Insurance Costs

Don’t give up and keep hitting the gym like you promised this year. If you are among the two-thirds of Americans who are overweight or obese, losing weight with a healthy diet, exercise program or lifestyle change could qualify you for lower life insurance rates.

Most life insurance companies take a basic height to weight ratio into consideration when determining insurance costs. If you have no other risk factors, being a few pound overweight is not likely to affect your costs, but 30 pounds and over the ideal weight could be driving up your life insurance costs whether you have an existing policy or are applying for a new one.

To be considered for preferred life insurance rates, it is important to keep your height to weight ratio at or near the normal range for your body type. If you have lost weight — and kept it off — to bring yourself into ‘normal’ range, be sure to let your company know. Policyholders may be able to get reconsideration of their life insurance rating classes.

For those with term life, you can save 5 percent to 15 percent on the cost of insurance by being in good shape. Those with permanent life insurance (whole, indexed, universal, variable, etc.) may be able to use the savings to put more towards the cash value portion of the policy. Your savings will vary; ask your life insurance agent for details.

Drink Less Alcohol – Save on Auto and Life Insurance

Lemon and Soda Water Please. Cutting back your alcohol, restricting it to home or only imbibing on occasional holidays can reduce the likelihood of long-term health effects, as well as accidents or DUI arrests. While we all know drinking and driving can affect your auto insurance rates, you may not know that it could be affecting your life insurance rates too.

A DUI conviction costs a lot of money in lawyers, fines, towing…etc., but it will also drive up your auto insurance rates. Flash forward five years, when you want to purchase a life insurance policy, the life insurance company will check your driving record and such a red flag may mean you don’t get underwriting.

Excessive drinking alone may be negatively impacting your life insurance rates. Most insurers require a medical exam, therefore, heavy drinkers or alcoholics who have not had any legal issues may be exhibiting the debilitating effects of alcohol. Taken into account with your overall health, the insurer might consider offering you pricier terms.

Limit your intake of alcohol and refrain from any alcohol related accidents or convictions and you could qualify for preferred rates. For those combating alcoholism, your rates can come down (you may even qualify for preferred rates) if there has been no history of, or treatment for alcohol abuse in over 10 years.

Drive Safer & Ditch the Phone – Cut Your Auto Insurance Rates

Don’t Text and Drive…Slow Down…it’s worth it. Since auto insurance is a required, inelastic expense for many Americans, anything we can do to cut our bills is a boon. For many of us, that means making a commitment to drive slower and take advantage of hand-free technology to prevent accidents and traffic tickets, which can increase premiums.

You can already cut your auto insurance rates by reducing your annual mileage or upgrading to a safer car, but consider enrolling in your insurer’s telematic device program, which monitors your mileage, what time of day you drive, how fast you accelerate and turn, and how hard you brake. By keeping your annual driving under 12,000 miles, slowly applying the brakes and keeping under most 65-70 mph speed limits, you might receive a reduction in your car insurance rate.

Quit Smoking – See Health & Life Insurance Rates Drop

Kick the Habit for Good this Year! Smoking raises premiums for permanent life insurance, such as whole and universal life, as well as disability and long-term care insurance. Each company has its own guidelines for what constitutes a smoker and how long a consumer must be free of tobacco to qualify for non-smoker rates.

Some companies mandate that any amount of nicotine found in the urine classifies a consumer as a smoker, some companies do not count trace amounts from smoking the occasional nicotine product and others offer graduated scales with rates that drop the longer you stay tobacco-free.

If you have a term life insurance policy and have been tobacco-free for a year or longer, ask your agent if you qualify for preferred or standard non-smoker rates. You might just be surprised by just how much you could be saving.

Improve Your Credit Score – Good Scores Tend to Get Good Rates

Remember that credit is money. Insurance companies in some states can use credit information as a factor in setting your home or auto insurance premiums. Those with good credit get lower rates than those with poor credit histories.

To improve your credit score, request free copies of your credit reports through Experian, Equifax® and TransUnion® then consider strategies with your trusted financial advisor to correct any factual errors. Catch up on debts or late payments, pay your bills on time and keep balances of 30 percent or less on lines of credit. While not all states use credit history information when setting rates, it’s still a great idea to improve that score!

Do Those Home Improvements – A Safer Home May Bring You Savings

Cleaning the garage doesn’t look so bad now. There are a number of ways you could be saving money around the home. Replace fire and carbon-monoxide alarms. Add deadbolts to the main doors and windows. Replace that old wood shingle roof with a roof made from fire-safe materials. Install a smart home security system.

Even cleaning out the garage so you can park your car inside to reduce the risk of theft or damage may reduce your auto insurance rates. Ask your agent about available safety and security discounts you can earn for all that hard work.

Learn More About Your Insurance Options

Whether it is auto, home or life insurance, the best way to save money and improve your coverage is to become educated and informed about insurance. Take stock of your coverage and possessions on a regular basis since your situation and needs will evolve over time — as you change jobs, grow a family, change vehicles, retire or pay off debts. Then review your policies with your trusted insurance agents to ensure you have enough of the right coverage in place.

So stick to those New Year’s Resolutions and speak to a trusted financial professional and insurance agent to get the savings you deserve.

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About Scott Ho

FSN insurance and retirement journalist - Planning for your retirement or understanding your insurance needs can be confusing and difficulty. Scott knows these tasks can seem daunting. He offers his experience to make choosing insurance coverage and planning for your golden years a successful endeavor. Connect with Scott at !

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