Buying Insurance Direct May Not Be Your Best Option

June 5th, 2009

Local insurance agents offer better prices than GEICO, Progressive Direct, and Esurance. Don’t be fooled by slick TV advertising!

Convenience does not guarantee best price.

We most certainly live in a very fast-paced society. Although the economy is facing one of the worst recessions in recent history, convenience is still something that we all desire. When we shop for groceries we often use a local grocery store to do so, when we fill up our gas tank we likely use the service station close to our home or place of business.

In years past when you looked to purchase car or home insurance, you likely would go to your local insurance agent to do so. Companies like GEICO, Progressive Direct, Esurance have made purchasing insurance seem both easy and convenient. With their witty and comical commercials you seem to get the impression that you are assured to save money on something that we don’t necessarily want to spend a lot of time thinking about.

However what’s interesting about these companies is that they don’t necessarily offer the best savings opportunities for your insurance. Sure, you can get a quote, and buy your policy with a few clicks of the mouse, but do these companies really offer the best price?

You might be surprised to learn that you can receive a much better price from a local agent who lives right in your community.

GEICO, Progressive Direct, and Esurance plus the growing number of companies that sell their policies directly to the public spend billions of dollars to get their message out to the public. Those billions of dollars invested in advertising goes right into the price you pay for your insurance.

So before you are tempted to purchase a policy from GEICO, Progressive Direct, Esurance, or any company that does not use local insurance agents, take the time to get a quote from a local agent.

By doing so you will likely save more money compared to what one of these companies can offer you, plus you are purchasing insurance from a local agent, often a small business owner living in your community, not to mention someone you can meet with in person.

For a free insurance quote from a local agent in your community click here.

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Who Offers the Best Price on Car Insurance?

May 31st, 2009

With an abundance of television advertisements nonstop from some of the top players in the insurance industry one could conclude that he who advertises the most has the best rates on car insurance. Evidently many consumers agree with that notion as well. In 2008 GEICO not only grew policies in force by 8.2% but at the same time dethroned Progressive Insurance as the number three writer of private passenger automobile insurance in the United States.

What drives these impressive sales numbers? Advertising, advertising, and more advertising.

In the year 2007 GEICO spent $751 million in advertising. Exact figures are not available for 2008 but a record $1 billion or more was estimated to have been spent to encourage insurance buyers to pick up the phone and call for a car insurance quote.

But here is the Billon-dollar question: Does GEICO have the best car insurance rates? If you buy an insurance policy direct with GEICO thereby cutting out the so-called middleman (the insurance agent) does that guarantee a better price?

In a word no, GEICO sets their insurance rates in the exact same way that other insurance companies set rates. GEICO spends a considerably larger amount of money on advertising than any of its competitors and a interesting fact insurance buyers may not realize is the money invested by GEICO in advertising for new customers, is reflected in the true cost of the car insurance policy you own with GEICO.

In other words if GEICO decided to spend no money next year on advertising in theory they could lower the rates for their customers by $1 billion!

That might save GEICO customers 15% or more on their GEICO car insurance policy!

The Agent Gurus Network recommends local insurance agents as a better option for consumers when they purchase insurance. Click here to receive your free quote and find out why professional advice and not just a price™ is a better option for consumers.

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Rate Shopping Comparison

January 8th, 2009

We are bombarded with television advertisements from insurance companies who sell car insurance directly to the public. Do such companies offer a better value compared to insurance companies who use agents exclusively to sell policies locally in your community?

Some car insurance shoppers may assume this is true, so we decided to put these companies to the test. We evaluated insurance rates from GEICO, Esurance, and Progressive Direct, companies that sell mainly to the public directly, (although all 3 companies mentioned here also sell through agents) with companies who exclusively use agents to sell insurance policies namely State Farm, Nationwide, Farmers Insurance, Grange Mutual, Encompass, and American Commerce Insurance Company.

This actual car insurance comparison is based on a married couple living in the suburbs of Cincinnati Ohio, with no tickets or accidents in a 5 year period. Vehicles quoted are a 2008 Acura TL, and a 2004 Honda Pilot EXL. Coverage limits are 250/500/100 with matching uninsured and underinsured limits. $100 comprehensive and $500 collision deductible. Loan/Lease gap coverage and finally road side assistance plus car rental is included. (Neither State Farm or Nationwide offers lease/ loan gap coverage)

Name of Company and Monthly Price

Esurance - $114.37
GEICO - $113.75
Progressive Direct - $109.19

Nationwide – $127.45
Farmers - $117.84
State Farm – $107.22

Grange Mutual - $99.80
Encompass – $81.83
American Commerce - $73.00

In this case study, the assumed price advantage is not evident with companies such as GEICO, Esurance, and Progressive Direct when rates are compared with other companies who exclusively use agents to sell coverage.

In all fairness, a similar comparison in other parts of the country, or with different coverage circumstances may not yield comparable results as insurance companies use so many variable factors to set rates. So you should not rely exclusively on this simple case study as an indication of the competitiveness of the companies indicated. Rates vary by type of cars owned, specific rating territory, credit levels, coverage limits, and frankly too many other factors to mention.

However in this specific example a better rate can be obtained by companies using agents compared to buying directly from the insurance company.

The Agent Gurus Network recommends that you care for your insurance needs by using a local insurance professional versus a company that sells policies exclusively online or by the telephone.

It is our opinion that reviewing your coverage needs with a local professional insurance agent is a better option even if you need to spend a few extra dollars. Click Here to receive an insurance comparison from a local agent in your area.

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Tickets / Accidents

December 15th, 2008

How might tickets and accidents affect your car insurance premiums? One speeding ticket in the last three years will likely not have a significant impact on your car insurance rates, unless it is a teenage driver. However, multiple tickets and accidents most certainly will impact your rates.

If you have experienced a large increase in car insurance premiums your best bet is to take time to receive comparison auto insurance quotes from competing companies. The Agent Gurus Network has established a fast and easy way for you to receive multiple car insurance quotes from top rated companies wishing to bid on your business. Click Here to do that now.

The reason why it is important to request comparison car insurance quotes is because insurance companies charge differing amounts of money when tickets and accidents accumulate. Some insurance companies essentially want you to take your business elsewhere by increasing your rates substantially, while other companies will make the increase more reasonable.

Depending upon the company, the rate increase for multiple tickets or accidents can be most severe. Some companies may increase your individual rate two to three times the normal rate meaning that your car insurance premiums could double or triple! Or worse, you could be dropped by your insurance company altogether, being labeled as a high risk driver.

Many years ago I experienced this first hand. A minor accident was caused with only minor damage and the claim was not turned into the insurance company. Three months later, the same car was totaled and our insurance premium jumped from from $1,000 per year to $3,000 per year instantly. Although we were not dropped, the rate increase to $3,000 per year made us look for other insurance options.

If you have had multiple tickets or accidents what can you do to lower your car insurance rates?

Some may conclude that taking remedial drivers’ training courses would be the best option. Taking such a course may remove points from your driver’s license, but your insurance company will likely not inclined to do the same.

The underlying reason is that remedial drivers training does not necessarily change the behavior of the driver; it removes the points from the license but not necessarily the behavior that led to the tickets or accidents in the first place.

I distinctly recall as I was sitting in a class room for driver’s education, watching a gruesome video of car accidents and the victims being pulled from the wreckage, with the purpose of “scaring” teenage drivers into considering the seriousness of speeding. Did it work for me? Absolutely not! My parents made the mistake of allowing me to drive a sports car they had purchased. With every opportunity I had, every time I drove the car, I pushed the ‘pedal to the metal’, one time exceeding 140 miles per hour with a few of my school buddies egging me on.

Remedial drivers training may remove the points from your driver’s license, but insurance companies will likely not remove the surcharge for tickets or accidents.

Changing your driving behavior is the best way to lower your insurance rates over the long term.

The second best way, as was mentioned previously is to obtain auto insurance quotes from other companies. Insurance companies use varying methods to set rates and penalize those who accumulate tickets and accidents, and the rate differences can be substantial. You can Click Here to receive online auto insurance quotes in all 50 states if your car insurance rates have gone up because of tickets or accidents.

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Teen Drivers

December 15th, 2008

Insurance For Teenage Drivers Will Make Your Premiums Go Through The Roof!

Parents, are you ready for your car insurance rates to double or even triple?

When you add your sixteen year old teenage son or daughter to your policy, you will likely notice a substantial increase in price. If you already have teenage drivers on your policy, the absolute best step you can take to lower your car insurance rates is to request car insurance quotes from other companies. The Agent Gurus Network has established a hassle free method for you to receive online car insurance quotes from top rated companies wishing to submit a competitive insurance bid on your business. Click Here to be connected to our referral network service.

The reason why you need to take time to shop around is that car insurance rates vary drastically between insurance companies. Truthfully, some insurance companies do not want to insure teen drivers and they will charge excessively high insurance premiums when you add your teenage son or daughter to your car insurance policy.

Why do some insurance companies shy away from insuring teen drivers?

The simple reason is that teenage drivers cause a disproportionately higher percentage of accidents, compared to older drivers. Consider these facts:

• Motor vehicle crashes are the leading cause of death for teenagers.
• 16 year-olds have higher crash rates than drivers of any other age.
• 16-year-olds are three times more likely to die in a motor vehicle crash than the
average of all drivers.

Some parents have been absolutely horrified to see their insurance premiums triple, when they added a teenage son or daughter to their car insurance policy. What steps can be taken to lower car insurance rates when teenage drivers are on your policy?

As was mentioned previously, take the time to obtain car insurance rate quotes from other local insurance agents in your area simply to compare whether or not you are getting a good deal. Take a few minutes to do that right now by Clicking Here

The next step you should consider is to pick an insurance friendlier car for your teen driver. An insurance friendly car would not be a sports car, a four-wheel-drive vehicle, or a luxury vehicle.

An insurance friendly car would be a four door, four cylinder, low profile car that does not need full coverage (Not a turbocharged four-cylinder vehicle by the way).

Also make sure that you are getting all of the allowable discounts for your teenage drivers, including:

• Driver’s training/education discount.
• Good student discount. (3.0 or better)
• Away at school discount. (for students more than 100 miles away from home-some
restrictions apply)
• Defensive driving courses. (some insurance companies will allow an additional
discount for defensive driving courses)

And finally, the biggest discount that you can ever receive on your car insurance policy is making sure that your teenage son or daughter is a careful driver. Inattentiveness, distractions and bravado cause accidents, severe injuries and sometimes death to our young drivers. Insurance companies will severely penalize parents (meaning considerably higher insurance premiums) when teen drivers push the pedal to the metal and get caught.

Have frank discussions with your teen drivers about the importance of safe driving.

Put into effect penalties such as loss of driving privileges if a ticket or accident occurs. That may be the biggest incentive that a youthful driver has to drive safely, the fear of the loss of driving privileges if the rules are broken.

Look for upcoming additional tips for teenage drivers on our blog that will show parents the best way to get the lowest prices on car insurance when you have teenage drivers on your policy.

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