Shopping Around For Insurance

You can buy insurance direct from the provider, your bank or building society, a supermarket, or broker. You can also buy insurance from the provider of another product (such as travel insurance from your travel agent).

For straightforward insurance, direct providers often offer the best deal.

For the best price for less straightforward cover, use a broker with access to hundreds of policies, who can find the best deal for your circumstances. A broker can also be a very valuable asset at claim time.

If you are struggling to get cover because, say, your home is at risk of flooding, a broker will probably know which providers are most likely to insure you. Using a broker saves you wasting time ringing several insurers yourself only to be told they can't cover you.

Reading the policy carefully

It sounds obvious, but you must read the insurance policy carefully. It sets out the legal obligations on both you and the insurer.

Check that it provides the cover you need and ensure you understand the excess - the amount you have to pay your insurer every time you make a claim.

Make sure you're happy with what is excluded from the cover: If not, try getting this changed.

You may have to pay extra to do so but it may be worth it. If you need clarification, ask your insurer.

Deciding on the excess

When you claim on your insurance policy, you usually make a small payment, known as an excess, before you get money from the insurer.

Some policies have several different excesses, depending on what you are claiming for. For example, if your home has suffered from subsidence in the past, you may have to pay a higher excess on a subsidence-related claim than you would if your laptop was stolen.

The standard excess can be anything between $100 and $500, but you can get this raised or removed completely.

The higher the excess, the lower your premiums, but don't opt for a greater excess than you are comfortable paying.

Making a comeback if things go wrong

Your policy documents spell out how you make a claim. If your arranged your policy through a broker, you should contact your broker for additional advice. In many cases, a broker will manage the claim for you.

If you're unsatisfied with the way your insurer handles your claim, inform it in writing. If you aren't happy with the way the insurer deals with your complaint, contact the Insurance Ombudsman's office, which can intervene on your behalf and make a binding ruling.

Cutting costs - without skimping on cover

Insurance can be expensive ... but there are ways of cutting your premiums without slashing your cover:

Pay premiums annually rather than monthly. Insurers often offer a discount for this.

Don't double up on cover. You can only claim on one policy. So if you take out baggage cover as part of your travel insurance, check you aren't already covered by your contents insurance. Read the small print on your existing cover first before buying any more.

Shop around for cover using a broker or personal finance comparison Web sites.

But don't be guided solely by price; it is important but enough cover is more vital.