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CREDIT SCORING BILL GOES DOWN IN FLAMES |
Article Number 10 OVERPAYING FOR YOUR AUTO INSURANCE? HOW INSURANCE QUOTES WORK I f you have the ability to see or hear, chances are high that you've seen advertisements for saving money on your auto insurance. Auto Insurance is arguably the most competitive product that most people need in their lives. Insurance carriers go through phases where they want to gain more clients and decide to churn out commercials by the dozens and buy frequent spots so that they will be played at a time to make certain that you see it! TV, Radio, Print and Internet Media are all saturated with ads from every company available. What do they say and what proof do they actually have that they can save you money? It??s all in the wording. SAVE 15%, SAVE 40%, SAVE 70% OFF YOUR AUTO INSURANCE! An insurance company can advertise any percentage of savings they wish. Any percentage of savings advertised could apply to a number of different things. Generally, the consumer will assume that it is a percentage of savings off of what they currently pay right now. This isn??t always the case. How it works: Base Rate ?? It is starting rate that all companies tend to use as a baseline. Discounts ?? Subtractions from base rate calculated from your life's circumstances. Some examples of discounts could be Homeowner, married, employed, affinity (type of employment), credit scoring, driving history, age etc. Savings off of Base Rate ?? This is a percentage of how much you saved in comparison to that particular company??s base rate after discounts are subtracted. Savings off of Current Rate ?? How much money you save when compared to your current insurance policy. Your quote starts out at the company??s base rate and using information provided, they discount it until they come to what is called a ??quoted rate? for your auto insurance. What they compare this final number to is how they come up with your savings percentage. Example Auto Quote: Final Quoted Rate: $584 Confused? It??s not hard to be. It??s exactly how the system is supposed to work. If you were told ahead of time that you are going to save 65.8% would you be more likely to allow the company to give you a quote? The number seems so attractive that most people think, why not! Insurance for many people tends to be something they just pay for every month with no real and tangible benefit to them. So when budgets get tight, or even when the bill arrives in the mail, its a constant reminder that this money feels like its going towards nothing until of course something happens and a claim needs to be made. Regardless of the facts or product, most people feel they pay too much for their car insurance. Which means that most people are also an open ear if someone tells them that they are ??Paying too much for their auto insurance?. The only thing that needs to be done is a step to take action. ON AVERAGE, OUR CUSTOMERS SAVE $365.72 Why the specific amount? Well, the amount needs to be set into a believable price range yet high enough to make a call to action worthwhile. To get you out of your chair right now and allow us to give you a quote, we need to do something to make you act and initiate the process or throw out our ??call to action? to get you to start the process. The average range for this if it is a specific dollar amount, seems to be in the mid $300 range. There is a difference though, once you have gone through the process of providing your details and getting an actual quote and the end result is not $348.23 but instead a mere $65.28, you might still change insurance companies, because you've already come this far and it??s still a savings! The hard part is to get you to take the call to action and get started! How did they come up with $352.98 in savings then? Why do you keep changing the amount? Because it??s an arbitrary number and it never mattered in the first place what it was. We could tell you that you could save $8621.98 on your car insurance because well, could is the key word and anything that??s said after that doesn't mean anything because it was disqualified with the word could! The funny thing about statistics of what other people saved is they can exclude people from the statistics pool that only saved $25 or ended up actually paying more than before! They also make no mention of better or worse coverage etc, the only thing talked about is a dollar amount. If you drop every coverage but BIPD or Liability and reduce that coverage to 15/30/10 or whatever the state limit is, you could truthfully save 80% from what you used to have. The person you hit if you at-fault will be covered to the minimum level required by your state however, you and your automobile are no longer covered in case anything happens! WHY DO YOU NEED AN INSURANCE QUOTE?We've taken all this time to tell you about why many ads use bogus tactics to pull you in and get you working on a quote, why would you still want one? Quite a few reasons, your current insurance company might not be the best one for you. Many people start out with one auto insurance carrier when they first start driving and get so used to it that they don??t realize that their current company no longer targets their demographic. Each insurance company has a target market, they often will not admit this fact in their advertisements. Mainly because someone currently using that company will be more likely to make a change and they will lose existing clients. It??s always a good idea to check and compare your rate and coverage against other offerings every 2 years or after a major change has occurred in your household. We say rate and coverage because of the previous example, coverage can be chopped up to reduce the rate with any company. Its important to get the best value for coverage at the most reasonable rate and with an insurance carrier that is likely to have better customer service and claims payout history. These changes include, home purchase, car purchase, employment change, driving record changes, age bracket change. Insurance age brackets are as follows: 16, 18-21, 25, 30, 35, 40, 59, 60, 65, 72, 75 and 78. Each time one of those age brackets has been passed, your demographic has changed and it??s quite possible you are no longer fall into the target market of your current insurance carrier. When you seek out quotes for your household, you need to talk to at least 3-5 different companies to get fairly solid picture of who can offer you what. This has become much easier to do in the age of the Internet because you can do most of the work over email. GetCoveredUSA offers you the opportunity to input your information one time and allow multiple companies that apply to your specific situation work to earn your business. (Note: You can start the process using the form on this page) WHAT INFORMATION TO PROVIDE INITIALLY TO OBTAIN A QUOTEIt??s a good idea to only enough information to complete the first level of the quote process. If you end up choosing one of the companies that present you with a better offer, you will need to provide additional information to complete the process. Information to give when initially obtaining quotes:
Information to avoid giving out until a final decision is made:
GetCoveredUSA.com TIP: WHAT THE INSURANCE COMPANIES DONT WANT YOU TO KNOW!The only thing the companies will advertise is that they could save you money. Not specifically who their target market is. Because advertising anything else can cost them current clients who find out the truth. Also, keeping all of your insurance business under the same roof isn't always the best idea. Though it could be convenient for billing consolidation, some companies don't offer the best product and price for your situation on all your insurance needs. The more products you have with one company, the more likely you are to stay with them. That??s why more and more insurance carriers offer auto, home, life, banking and investment services even if they aren't the best at covering you on all of those lines. It??s a good idea to package your Auto and Home together, however leave your life, investments, retirement and banking needs to other companies.
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Copyright 2009 GetCoveredUSA.com All RIghts Reserved. Disclaimer: This site is intended for informational use only. All articles and advice posted should be discussed with a licensed insurance professional prior to making any changes or alterations to your insurance policies. Information submitted to getcoveredusa.com quoting services will be kept in confidence and will be exclusively distributed to licensed insurance agents for quoting purposes. Contact information will not otherwise be sold, distributed or furnished to any other person or entity for any reason unless required by law.
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