Right Quote, Right Price - Right Now!

Many people ask this every day.  Full coverage is commonly referred as carrying comprehensive and collision.  The response depends on how fast you paid off your car, how old is your car, did you buy it new or used, what is your car worth, and can you replace your car if it gets stolen?  If you bought your car new and paid it off within the average term 36-72months I would say do not drop full coverage.  The type of car definitely matters.  If you have a 7 year old family sedan with 100k miles on it then probably no.  If you have only a 3 year old diesel crew cab pickup then probably yes.  Simply based on what it would cost to replace each one of these can be anywhere from only a few thousand for the family sedan and the truck might still cost you tens of thousands to replace. It really should be a simple process to figure out.

Step 1: Look at pricing guides for your vehicle to determine what it is worth.

Step 2: Find out how much full coverage cost.  If it is only costing you a few hundred to carry full coverage a year and your car is still worth more then $5,000, I would.  If not and you need to save some cash, you can also raise the deductible to still have the coverage but reduce the cost of insurance.  You can always just roll the dice and just drive with liability only.  Keep bringing your questions and we will do all we can to help.

Well this question is presented to us all of the time.

The simple answer is NO!

The concept behind paying for insurance is that in case of an accident the insurance company will pay for any property damage and any medical injury you cause to others in the accident, not you.  By selecting state minimum coverages you are putting your assets and personal liability at risk.  Why you might ask?  Well if you select your state’s minimum coverages and you were to get into a serious accident, the insurance company will only pay up to the amount of coverage you selected.    You do not want to have to pay for any claim out of your own pocket that is why you are paying for insurance in the first place.  What if I don’t have any asset other then my beat up old car?  In some states if you are found at fault for and accident your future wages can be garnished..

 Whether you drive and old beat up car or a flashy new sports car, do yourself a favor and try to buy higher limits of liability when ever possible. Twice the coverage is not twice the price. It may only cost a few dollars more per month to carry at least twice the minimum state amount. Ask your insurance company what the cost is for state minimum then see what the cost is for more coverage.  You might be surprised and at how little it cost to be protecting your assets for only a small amount more.  Stay tuned for more Q and A from Mr. Q

I want to shop for car insurance but I need some tips on how to save money.  Can you tell me what I should know when shopping?

Here are 10 Real tips to saving on car insurance!

Sure we all have heard of ways to save money on car insurance, but I decided to give 10 real ways to help.

Whether or not you are shopping for car insurance or just want to save money at your current company here are some tips that can really help!

TIP1: Get a quote with auto and home together

If you don’t own a home get a quote with a renters policy.  Many major companies are now offering discounts up to 25% off the auto and home when you write them on the same day.  By adding a life insurance policy you could save even another 5% to 10%. As for renters you can get discounts 10% to 15% off of your auto.

TIP2: Ask about discounts for your profession

Insurance companies across the board offer discounts for particular occupations that they feel are a better risk to insure. You can save as much as 10%. If your profession is not offered a discount from the company your working with, check with your employer about insurance companies that do.

TIP3: Bill paying discounts

When you find a company that you want to there are two big ways to save simply on how you pay.Pay in full can offer you a 12% discount and electronic withdraw if you pay monthly can offer 10% off the premium.

TIP4: Deductible Rewards

If you carry full coverage, companies offer many different deductibles and some carry deductible reductions or rewards for every year you drive without an accident. Example would be if you carry a $500 deductible and drove five years with no accidents then in the sixth year you had an accident, you would not have to pay a deductible to repair your car.  Be sure that the companies offering this are not charging you any extra…many do! If they do don’t pay for it!

TIP5: Carrying high limits of liability could actually save you money

If you are shopping for a new company often they will give a customer more of a discount if you have carried high limits of liability (this is your BIPD coverage) at you previous company. This means that you could be paying the same amount for higher limits which protect you and your family as the customer only carrying state minimums.

TIP6: No Claims = Cash Back

There are a few companies currently offering 25% of your annual premium paid back to you if you carry auto and home and stay claim free for three years. This is a great feature.  Don’t file a claim and receive a check back every year!!!

TIP7: Annual Review

Review you policy with your agent at least once a year or simple call your company to see if they have any policy features or deductible that may save you some cash.  Insurance companies are coming out with so many new products to attracted new customers, sometimes they forget about their current clients. Don’t  be shy to call.

TIP8: Know your credit score!!!

Insurance companies know that the worse your credit is the more of a liability your are to having a claim or an accident. This can cause your rate to be as much as 50% higher!!! Yes insurance companies use this to determine your rate in many states. If you are married find out who has better credit and list them as the first one on your insurance policy or as head of household.

TIP9: Be aware of cars that may cause higher insurance rates

Some vehicles have higher insurance rates due to who is buying them.  Entry level cars often have higher insurance rates because many people who buy those cars are younger. Insurance companies tend to have more claims filed from younger, under 25. Let’s be clear we all know what kind of car Grandma drives and it is not what the young crowd wants to drive.

TIP10: Use a online quoting service

Use one at least once a year to receive quotes from multiple companies.  Remember it cost you nothing to quote your insurance. Some companies will offer a 5% discount to use a future effective date. Simple if you tell them that you want to start your policy at least a week out ask them if that will get you the discount.

Beware!

Beware of a few things…Companies now are offering huge discounts to write new customers for auto and home.  Many of these discounts fall off after the policy renews.  Ask the agent or the company if these discounts will stay on after the policy renews.

Hope this helps and stay tuned.

Problem

I’ve been with my same insurance company for more than 10 years and my rates never seem to go down - what gives?

I get this question all the time!  And it’s quite simple really.  Everything goes up with time, unfortunately.  One question we all should ask ourselves is, who told us our rate should go down with time anyway?  The insurance companies?  Maybe they tell us this so when you don’t see your rate go down with time you will want to shop it and hopefully call them to switch?

What would cause my rate to go up?

Hmmm - When prices go up for body work, for medical, and towing services it begins to affect the projected cost.  In addition to the obvious, your zip code, type of car you drive and credit rating are some major factors to the rate you pay.  I know that we all feel like our rate should only be determined by traffic tickets, accidents, and the kind of vehicles we drive.  The reality is that there are now many factors that your agent may not even be able to explain.

Why is this? Well, many major insurance companies now have invested into the idea that there could be 80 to 100 factors that determine what they feel is the most accurate rate. Where as, just a few years go, they might have only used 5-10 factors.  Finally, let’s not forget that insurance companies are a business like any other.  They are in business to make money, and you are the liability.  So the result is that many customers have seen rates change in the last few years even though they have never had an accident or any tickets.

The insurance industry has not done a great job in teaching us how to find the best company and policy for each person.  We have only been taught to shop, shop, shop, price, price, price.  We all have seen the ads showing how much you can save by switching.  You would think if you switched two or three times and saved the amount they advertise it would almost be free at that point!

Understanding the fact that insurance companies have very different rating experiences from one to the other in the same area is something we as consumers can’t control.

Solution

Our best defense is to understand that price should not be the only factor.  Coverage and claims response should also be at the top of the list.  The best thing anyone can do for themselves and their family is to always buy more coverage than the state minimum.  Remember twice the coverage is not twice the price.  You are buying insurance to protect your assets and, in some states, possible future wages in case of a severe accident.

Second bundle all you insurance together.  The major insurance companies are now offering more and more discounts when you package auto, home, and life insurance together.

Lastly find a company that offers discounts based on you profession and rewards you for carrying high limits of coverage with no claims.

Remember if a company is reducing rates don’t you think that it means they might have been priced to high in that area to begin with?  Also if your rate stays the same for a few years that actually would mean based on average rate of inflation you would be getting a discount for every year it stays the same - Right?

Hope this answers some of your questions and tune into our next post about 10 Real ways to save on car insurance.