We’ve all seen the commercials right? "…X number of minutes could save you X% on your auto insurance…" Or perhaps it’s a spokesperson (let’s just call her Flo-rida for purposes of this discussion) standing in what appears to be an insurance retail store selling insurance for your car, boat, motorcycle or RV by picking up a box off of a shelf. I applaud the creators of the commercials because from a marketing stand point they are hitting the target to get the phones ringing and the doors swinging for quoting insurance. The question however is whether or not that potential proposed savings is costing you more in the long run…in terms of both coverage and money?
The truth of the matter is that insurance is not a commoditized product that you can "do it yourself" by picking it up off of a shelf. And the idea that 15 minutes is adequate time to determine whether or not the minimum required limits of liability are sufficient to protect you, your family and other drivers is ludicrous at best. I can promise you after being on the other end of hundreds if not thousands of claim phone calls that I have never once been asked about the monthly bill amount by someone who has been in an accident that totaled cars or lives. One of the first questions is "…am I covered…" which is usually followed up by "… how much will my insurance pay/cover…".
There are always ways to cut premiums and reduce your cost of insurance but sacrificing coverage (which is the strategy these companies are proposing) should NEVER be one that is the determining factor. Take for example the driver who looked away for an instant to change the radio station in their car not realizing they were drifting ever so slightly into the next lane. They ultimately tapped the rear driver side of the car beside them and sent them into oncoming traffic. Four vehicles and a fatality later that driver who was innocently doing what all of us do on a daily basis is facing hundreds of thousands of dollar in liability and property damage costs. Their "15 minute" limits don’t even come close to being enough so now their personal assets (home, savings, investments) all come into play in a court of law and if there is not enough assets to pay then the other party’s attorneys will be quick to post a judgment against you until their clients costs are satisfied. This is a real life scenario.
So how do you maximize the most savings possible is you’re not reducing coverage? Make an appointment and sit down and a talk to a live agent about your entire insurance strategy not just one product. Leverage the multi-policy discounts most companies offer (discounts for insuring you home, car, and other items with the same company). Find out about umbrella policies that can protect you in the event you do use your limit. Find out about life insurance discounts on your home and auto policies. But most importantly build a long term relationship with an agent. You can shop for a better rate at every renewal but over time you will not save money. In most cases when you factor in the time spent shopping you will end up paying more in the long haul. Insurance premiums are a roller coaster. If you can find an agent and agency you trust they can help navigate you through the ups and downs so that in the long run your costs remain constant. That doesn’t mean you might not pay more during some policy terms than others but over a period of years your median costs will be far closer to level than those who are continually jumping from one company to the next. Not to mention that the easiest way for you to have a loss that doesn’t get covered is to have policies with multiple agents in different places because it’s impossible for them to really understand all your risks and exposures and how to best advise you.
Lastly, if you haven’t already you should consider an independent agent. We have the advantage of having multiple companies at our disposal so if you really do have a reason the test the insurance waters they can do the work for you with the other companies in their agency. Remember, just because your current agent may not be able to provide you with choices doesn’t mean you don’t have any.
-Bryan Miranda
No comments:
Post a Comment