Auto, Home and Life Insurance...The Poor Farm Budget 2017

Let me just say a big THANK YOU to all of you who have chimed in on the discussion we've had on the last few posts regarding  The Poor Farm budget 2017. I loved learning about the issues you deal with in other parts of the US, as well in other countries, especially in regards to health insurance.

Today I'll address another big ticket item in our budget for this next year, all the other insurances besides health care. Based on what we paid last year, our budgeted amount for all three (auto, home and life) was  $211 per month. It breaks down like this:

Auto was $65/month (Grinnell) for two vehicles: a 2000 Dodge Neon and a 2002 Ford F150 truck, both of which are paid for and have approximately 215, 000 miles each.  Auto was fairly high since in the past we both drove many miles in the delivery of our old farms products to several restaurants in Chicago and four grocery stores. Every day we were running somewhere so our chances of collisions were great. The  last two years I drove 150 miles a day back and forth to school. Now however, we are home more than we are gone and our mileage will drop significantly.

Home was $41/month (Belle Prairie) based on the Grain Bin House estimated replacement amount of $50,000. This included our home and belongings. But, we built the GBH for approximately $30, 000 including the new septic system and we've downsized our belongings by over 50%.

Life  was $105/month (Northwestern; Term life) for two policies, one for Keith and one for me. We want to be sure when one of us dies that the other has the mortgage covered, plus no worries about income, and if we were to die before we have our home cemetery plans in place, we want to make sure there is enough to cover burial expenses. We don't want our kids to carry that burden. We've had both these policies for over 20 years and we will look into them at a later date for possible reductions as well.For now we are leaving as is.

Obviously we had room to shrink our expenses here so a few days ago we went insurance shopping. We visited three offices in nearby Pontiac searching for one agent and one company to cover at least home and auto needs.  We were amused by the differences.

 Allstate for example does not insure any "converted buildings" and refused to cover our Grain Bin House, so we left them and went to an insurance broker who was very nice but couldn't give us any quotes that day. He would have to come out and see the property next week. Our third visit was with State Farm and we were very impressed with the time the agent took with us, her professional manner, and most of all by the rates quoted. So State Farm was our choice for 2017. (Note:We did not consider staying with the current company covering us as we were very dissatisfied with our agent.)

For auto we lowered our coverage overall from 250,000 for an uninsured motorist collision to $25,000 (Illinois state minimum) and we eliminated collision coverage on our vehicles. If they are hit and totaled, so be it. I guess we'll walk more. New monthly rate then for both vehicles, just $28.

For home, we kept the same replacement amount, $50,000 (still significantly more than what it cost us to build) and we dropped the replacement amount for our belongings. Less stuff to replace. There is still some coverage for accidents on our property to others but not much, since we no longer have farm store visitors coming and going.  Our new monthly rate, only $22.

To recap:

INSURANCE TYPE	2016 cost per Month	2017 Cost per Month
AUTO	65	28
HOME	41	22
LIFE	105	105
TOTAL	211	155

Thus overall we've decreased our insurance costs per month by about 50% for home and auto and with leaving life insurance the same, by approximately 27% across all three, just by reading our policies closely, decreasing some of our coverage and taking the time to shop around.

Now tell me your experiences with each, how do you manage?