Weird Car Insurance Quotes
There is something very fishy going on in the car insurance industry of late. A recent study by a insurance watchdog organization found that of all the different types of insurance products available, car insurance products have the greatest price variance given the same set of variables. To the lay man, if you use the same set of information about your lifestyle, where you park your car, your workplace etc and use that information to get quotes for the same coverage from different companies you will get huge differences in their quotations for car insurance. Sometimes the difference between the lowest to the highest can be as much as 100%. The coverage and risk figures are exactly the same; the only thing that can account for the difference in price is how much money the insurance company wants to make off their clients.
Some smaller companies that specialize in providing coverage for car insurance can even specialize in this type of practice. In effect what they do is prey on people who only ever get one quote for their car insurance needs. A small number of clients are too busy and will simply settle for a more expensive car insurance quote because they don’t know that there are much cheaper options out there. This may also be the case because their insurance agent has recommended their service. Little do they know that the insurance agent gets a bigger commission by referring the overpriced insurance to their clients.
The worst part about this is that the insurance firms that do this aren’t exactly doing anything wrong. They are simply putting up a trap and you are willingly falling inside. There are no laws against it and even the industry watchdogs are turning a blind eye to this practice. If you actually look at it subjectively, the car insurance provider that offers a car insurance quote that is too high compared to industry standards really isn’t doing a crime. It is merely a marketing profiling practice where certain consumers are just happy to pay the extra charges for the ease of not having to look around for other insurance quotations.
This is where the time honored saying of being a prudent customer comes in. It simply calls for you be wise before you settle on a certain car insurance policy. You have to make sure that you aren’t taken advantage off and get as many car insurance quotes available. We can understand that many people are too busy to fill in the many car insurance quote forms and liaise with the many different companies but the benefit of it far outweighs the costs. You will have a much better understanding of what you should be paying for you car insurance policy and you also get a higher level of market understanding.
Some car insurance companies also prey on clients who are very loyal to their car insurance providers. Some people stick to their car insurance company as if there is some sort of reward program in place. This consumer group is very loyal and will stay with their insurance provider for many years. What some car insurance companies do it increase the premiums ever so slightly every year. This could be in the lines of 3-4% per year. Most of these loyal customers wouldn’t mind such a small increase and simply continue with their car insurance policy with their old company. Over the years, through the magic of compounding they don’t realize that their car insurance policy has gone up in costs substantially. Some of the time, their insurance costs would have escalated by as much as 50%. It is only when the poor policy holder gets another quote for their car insurance that they realize what a huge increase in price they are paying.
The lesson to be learned here is that it is very important to be prudent with your car insurance policies. Be prudent not only when you are getting your car insurance policy the first time, but always be on the look-out for other car insurance quotes so you know that you are always getting a good deal.
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