Is it possible that auto insurance agents are a dying breed? Online providers are dominating auto insurance today.
There is some doubt that auto insurance agents are necessary anymore. You don’t have to spend Saturday morning at an auto insurance office trying to sell you a single policy. Auto insurance can be purchased online anytime, even weekends. You can also compare auto insurance policies and prices from multiple companies online. You can also buy your policy online in most states and file claims online.
It is possible to point out that many people prefer talking face-to–face with an agent than pounding the keyboard. They may feel more comfortable transferring money (premium payment) in person than they do online. They may also prefer to communicate with a knowledgeable person and ask questions.
However, the proportion of these people in the adult population is decreasing. Market research firm ComScore found that 67.5% of the 2,000 respondents in the U.S. last year indicated they would be open to purchasing auto insurance online. Online auto insurance has grown at a remarkable 55%+ rate in the last couple of years.
Online auto insurance can be a great option for replacing or purchasing your first policy. It offers many benefits, including cost savings, speed, convenience, speed, better information, and more information about the policies available from different insurance companies.
However, it is important to be familiar with the basics and benefits of auto insurance before signing up for an online or in-person policy.
The basics of online auto insurance
Insurance is required for anyone who drives a car in the United States. This is a well-known fact. But at what cost and what type of insurance?
Liability insurance. You may be familiar with the two main types of liability insurance: property damage and bodily injury. A 25/30/25 policy will cover bodily injury for one person, $30,000 per accident and $25,000 per accident for property damage. This coverage would provide very little coverage. You should evaluate your situation to determine the best coverage for you. Except for New Hampshire and Wisconsin which require liability insurance, all states require it.
Collision. This type of auto insurance covers you for property damage and medical expenses if you are involved in an accident.
Comprehensive. This type covers loss other than collisions, as well as theft.
Uninsured/underinsured motorist. You will be paid if the other driver involved in an accident has no insurance or not enough insurance. It’s not mandatory in all states.
Protection for personal injuries. Your unrecovered medical expenses and lost wages due to an accident are covered. A death benefit may be included in PIP. About 16 states require PIP coverage.
The so-called “no fault” auto insurance program is a source of confusion. No-fault systems allow all drivers to pay for their accident costs regardless of who is at fault. This system was thought to reduce litigation and thus lower costs. This didn’t happen. It often led to higher accident rates, higher insurance premiums, and higher costs. Most states that had enacted no fault laws were able to repeal them (DC. NV. PA. NJ. GA. CT. CO. FL). Only Michigan, Kansas and Hawaii remained, as well as Minnesota, New York North Dakota (New York), Utah, and Massachusetts. New Jersey and Pennsylvania have adopted “choice-no-fault”, which allows drivers to choose between a traditional or no-fault policy. (Results in terms of premium levels have been mixed.
Keep Your Premiums Low
Insurance companies may have some bizarre ideas about how to set your insurance rates. One example: I found that my rates rose after another driver struck my car. I phoned the company and explained my situation. The customer service representative replied, “Yes, but you were at the wrong place at wrong time.”
It’s a numbers game and it doesn’t take much effort to get equity in setting rates. To win, you must provide numbers that result in reasonable premiums to the company. You have some control, but not all. Age and gender are some of the factors that will be considered. Single males younger than 25 years old get higher rates, while women typically get lower rates. Many companies will also consider your zip code. Driving history (if you have filed any claims within the last five years, rates in New Jersey and California are higher than those in rural areas; many companies will now look at your zip code); how much you drive. Expensive cars, such as the Toyota Camry or Honda Accord, get higher premiums. Off-road vehicles and large SUVs get higher theft rates.
Find an Auto Insurance Company online
You’ll find that the Internet is saturated with companies advertising auto insurance and car insurance if you do a Google, MSN, or Yahoo search. There are hundreds of companies offering auto insurance online. You can order auto insurance online from Esurance.com and InsureMe.com.
Soon you’ll notice that every online insurance company has its own qualification process and set of screenings before they give you a quote.
Esurance.com is an excellent example. It asks for your zip code, which is a simple question. On the next screen, they ask for more information — how many cars are you insuring. How many drivers. Your car’s year, make and model. Your car’s uses. You may qualify for discounts such as car alarms, antilock brakes and airbags. You can get the coverage you need. So on.
Esurance.com is very easy to use and takes just a few minutes. After that, you will receive a quote from Esurance.com. This is an online (virtual) insurance provider.
InsureMe.com, a different website, offers a similar process but does not provide a quote. It lists several brick-and mortar insurance companies that will contact you by phone or email with specific quotes. You will be able compare quotes and policies, but you’ll have to wait for them to reach you.
Other auto insurance aggregators, as they are known, have different processes. Some, for instance, run your credit report.
As a final step to choosing a policy you might want to spend some time looking at your chosen insurance provider at AMBest.com. This is especially important if you don’t know much about it. You will need to create an AMBest.com account to check the rating of an auto insurance company. However, it is very easy to do. After creating your account, click “rating and Analysis” and enter your company name. Companies are given a letter grade, from “A++” to “B”. Your chosen company should have at least a B rating. This is considered “good”.
It’s a good idea, however, to apply online for a lower premium rate, even if your policy is reasonably priced. It’s free and easy, with no obligation. A recent survey by industry publication EDP Weekly found that one third of those who purchased auto insurance online and then bought a policy on their own saved over $500, with some savings of $1,100.