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Paying Your Insurance Premium

When you sign up for insurance policies whether it is auto insurance, health insurance, life insurance or even home insurance your premium has already been calculated based on many factors that determine what the cost would be per month and per year. Choosing your insurance policy can be a difficult task since there are many different coverages available, some suit your life style some don’t. Friends and family give recommendations for you to choose from and it may not be the best suited for you. Take your time and budget yourself and access what coverages you think would be the best for you and your family moving forward.

After you have completed the daunting task of selecting your insurance policy, if it was from one of the big companies in the space that we recommend or choosing your local insurance company to do the job you are now faced with how to pay them. Depending on what your current situation is like, you may decide that you would like to pay monthly since it could be easier to track, or you would prefer to pay in a lump sum per year so you can eat the costs up front and never have to think about your insurance cost till next year. There is no right or wrong method to paying your insurance company, although weighing the pros and cons may help you decide which course of action is the best for you. Take a look at the pros and cons that we’ve put together.

Deciding Your Payment Type

Depending on the payment plan you choose it is mainly focused on a few factors that customers look at either consciously or subconsciously to make their final decision.

  • Financial Standing
  • Ability to afford your years payment

How are these factors related to you making your payments monthly or yearly? Here is a subtle break down for you.

  • Financial Standing
    • Based on all of your current needs and monthly payments to your commitments you would need to ask yourself if you are able to afford your monthly insurance premiums per month comfortably. If the answer is yes, by all means. Usually when a consumer decides to budget their expenses, most of the time they do the budgeting on a monthly bases. This is so they can keep track of an accurate expenses. For example: your mortgage payments, school fees, car payments, gas, phone bills. These all add up and take away from your monthly paycheck. So factoring in your insurance for the month is a great way to determine if you are able to afford the monthly payments.
  • Ability to Afford a Years Payment
    • If you are in a position to make the onetime payment for your insurance and feel that it is a good idea for you to do so, we highly recommend it. Most insurance companies give you a break on the insurance premium if you were to pay upfront for the year. Paying for your insurance upfront saves you from missing any monthly payments. Which is a great incentive since you won’t have to worry about any outstanding payments and potential cancellation of your insurance policy.

Picking the right payment method is essential to your income. Being able to afford it comfortable is key to your payment structure and budgeting. Of course some companies give you the ability for custom payment options to help you with your financial situation which is great. Weigh the pros and cons for your own situation and pick the choice that is best for you.