How to Compare Insurance Rates and Plans

There are a variety of insurance plans available today. Selecting the right insurance plan isn't too difficult and requires just a few minutes of work. Price isn't the only factor in comparing two insurance plans, as the features and benefits of different plans can vary greatly. Total coverage available, available riders and policy exclusions should all be considered.

Instructions

1. Compare costs. The first step in comparing insurance plans is considering the premium for the coverage. Most policies quote coverage as an annual premium yet many people pay for their coverage monthly. Be sure to get quotes that show the premiums for the time period for which you would like to pay them.

2. Consider the coverage limits. Different types of insurance have different limits but all policies will specify an amount of coverage. The coverage limit is sometimes referred to as a face amount or total coverage limit. The greater the limit of a policy the more the policy will cost. When comparing coverage limits, pick coverage that is neither too big nor too small for your needs.

3. Consider the exclusions. Nearly every insurance contract excludes certain circumstances from claim. For example, life insurance contracts won't pay out in the event of suicide for several years after purchase and liability policies may not cover damage from war or acts of God. Some exclusions may not be important to you, but others may be consequential. Many times health insurance has specific exclusions for expensive treatments or common sicknesses.

4. Consider the available riders. Most insurance contracts have policy riders available. Riders enhance coverage and provide insured persons with additional benefits. A common rider for life insurance is called a waiver of premium. Waiver of premium allows disabled insured individuals to not make premium payments while disabled and to keep their coverage. Every type of insurance has different riders; some are beneficial and others may be costly or unnecessary, so be sure to consider and compare all your options.

Tips & Warnings

• Be sure to thoroughly read through the insurance policy so you understand the coverage you are purchasing.