Are All Car Insurance Companies Equally Good & Cheap?

People often generalize things that they have limited knowledge. That is why often motorists put all automobile insurance carriers in one basket and say that they are all the same. This may also be due to the dim view people have about them. They may believe that one isn’t better than the other when they say they are similar. Let’s have a close look at this statement and see if it in anyway reflects the position in the marketplace.

Each has unique corporate values, ownership structure, underwriting expertise, risk preferences and competitive edge that it may be ignorance to say all vehicle insurance companies offer the same thing or price. Also there are many factors that can make one more suitable for certain group of drivers than most others. So, it is always best to get a few quotes and compare them for coverage, price and look into their strength.

Another misunderstanding is that people believe state authorities determine auto insurance rates. This isn’t really true. Yes, the commissioner usually needs to approve them but essentially underwriters are free to determine their rates as long as they don’t discriminate and break state laws.

All these variations will result in different car insurance quotes as well. Like every other product and service, premiums charged can be widely different from each other. That is why it is important that you shop around a bit before accepting any quote. This can be done pretty easily and quickly online and you can get a few from our panel by entering your zip code above.

What Makes an Auto Insurance Company Better?

If they are not uniform than some would be better than the others and you would want to find those more suitable and competitive. There are certain areas to take into account when choosing and they will be discussed in detail below.

It is important to know that the best vehicle insurer for you is probably different than your parents or children because you have unique driving record, experience, age, gender, zip code and all those affect the way each calculates a tailored price for you. People may not realize but they tightly reflect the risks associated with you, residence of the household, the vehicle and zip code. 

1. Financial Strength
First thing you would want to check is that there is no risk of them going under anytime soon. There is no need to take any chance if you cannot gather enough information after a quick search online. Just move to the next one in the list. We have a few posts that look at them in detail including automobile insurance comparison charts, AM Best and JD Power ratings.

2. Claim Payment Records
Obviously a strong claim settlement history will set your mind at ease. The last thing you want once you are in trouble is to be quizzed by an adjuster and even worse to be messed around. Here are the top car insurance companies for settling claims to help you decide. If you have years of clean history and experience you may not be bothered with it and just want to take the cheapest quote. However, you should pay close attention to this point if you are a new driver or one is listed on the policy. Especially, they have a high chance of having accidents in the first year. This is a selective approach but why not. They will try to weed the high risks out wherever they can and you can decide when to beef up coverage and when to relax a bit.

3. Competitive Pricing
Why would you pay more for something if you can get it cheaper, providing everything else similar to each other? General consensus is that large ones must be more expensive. This is again not necessarily true. They may be expensive for high-risk drivers but they are usually cheaper when the applicant has clean record and long experience. So, don’t hold back when you are getting quotes. The worst that can happen is they price you out. That is never a problem in a market with tens of other options. It is about formulas and computers calculate estimates these days. So, it is nothing personal.

Every company will come back with a totally different quote for exactly the same driver and coverage. According to surveys the price gap can be as much as thousand dollars in some areas and it does not appear because one is inferior to the other. This is another misconception. Sales agents keep telling motorists that only cheap auto insurance companies can give you low quotes because they are not as reliable. This is utter nonsense as large premium difference can happen between two highly reputable names. In fact, a subsidiary can be a lot cheaper or expensive than the owner corporation and there are many examples of it.

Now you know that each time you fill a proposal form you should expect to get distinctive results that it is worth taking a little time to have a good look around and try to pin down the most suitable and economical choice for you. Remember that there is only one of you in this world and therefore you need to make sure your requirements are fully satisfied.

Also, you should be extra careful with self-promotions and advertisements. A good advertising strategy and sweet-talking sales force can show anything in a much brighter light in this age of media and television. And a company who strives on delivering the best for customers but lacks in adverting and publicity can be ignored because of lack of name recognition. That is why you need to look at independent assessments and ask a broker if you need to. You can actually do this online through many forums where many brokers answer questions from prospective clients.

Some try to differentiate themselves from the rest by offering great vehicle insurance policy packages while others concentrate on pricing. Also, a few rely on strong name recognition and hope that people will pick them just because of it even though they may be expensive. At the end, it is up to customers to weigh them up and choose the ones they consider to be better.