It is unlike that a satisfied customer would leave their current providers unless there are sufficient reasons to do so. That is why gaining a new customer in the first place is where the fight begins. Once you manage to get the signature of a new policyholder they are not going to bother the company unless they have a claim. Furthermore, they wouldn’t know if their auto insurer is dependable or not until they test it with a claim.

So, rival providers have to be creative and highly competitive. Cheap auto insurance is a way for any auto insurer to step in to the market and take business from other vehicle insurance firms. To draw shoppers away from another vehicle insurance corporation it is generally known by most insurance firms that they’re going to have to offer less expensive quotes to those clients than their competition.

So as to do this, insurance firms must make important changes to the way that they do business so that they can afford to supply inexpensive service. So as to lure buyers with inexpensive vehicle insurance some auto insurance firms will take the old-fashioned approach of cutting back the work-force. By downsizing and getting rid of some areas of the work force the auto insurer can turn around and offer more rebates to consumers because the price of running the firm dropped.

Sadly for some insurance corporations, less workers sometimes means client service gets hit which causes some consumers to look other places for insurance. If an auto insurance corporation wants to supply inexpensive automobile insurance though not take a blow in the consumer service dept they can try turning into a more “non-standard” insurer.

This kind of insurance might mean the auto policy may not cover everything that’s generally covered by a vehicle insurance corporation. By getting rid of some of what are usually covered losses an auto insurance corporation can lure purchasers with lower vehicle insurance quotes. But this kind of cut in service implies that consumers might be upset by insurance not covering what’s predicted. An alternative way a vehicle insurance corporation could offer you a smaller rate and lure more purchasers is to depend more on investments than rates. All auto insurance firms make cash by investing the premiums they earn, not from the particular premiums.

If an automobile insurance corporation can offer a reduced rate to you and not need to reduce consumer service or expectancy they could presumably increase their purchaser base. The more premiums they have the more they can invest and the more return they get off their investments. Inexpensive automobile insurance isn’t necessarily a hint that an insurance firm isn’t good or does not provide good service; often it’s a sign they are basically better with their cash. To draw shoppers away and keep them most insurance corporations have to operate off this idea, making more by investing better.

This brings in extra money and disposes of the chance of losing folks after client service does not measure up to expectancy. If you need inexpensive auto insurance and good service this is the kind of insurer you’ve got to find.

When the circumstances dictate motorists may have to look for the cheapest car insurance premium and lowest coverage just to be legally driving. This is understandable as many people drive without even buying a policy. However, many people are not cornered with money that tight and they can make choices. In such cases they would look at their options and try to arrange a reasonably priced policy, decent coverage and reliable insurer.

People buy policies to make sure certain uncertainties covered properly, not because the law enforces certain requirements. There are many policies that they do not have to buy like home or life insurance but it is prudent to do so. In the same way about 70% of the motorists buy full coverage that includes the minimum liabilities, collision, comprehensive and uninsured driver coverage.

Most car insurance companies would come up with goods when their policyholders need compensation. Nonetheless there would be one or two that would not make you jump a few hoops before they fix your car or pay the final settlement. Many people do not have stomachs for these companies. They would rather stay away from them even it means they have to pay a little more.

It is true that paying a little more does not guarantee a better service but may extend your choices. Let’s have a look at the options here. For example, you got five auto insurance quotes from various companies and they are $2,800, $1,900, $1,600, $1,500 and $900. Here you can see that there are a few companies around $1,600 range and it looks that this figure is fair.

Two quotes sticks out on both extreme end. There is no doubt that you would dump the $2,800 quote. Why would you not if all those companies are offering the same coverage and you still have four choices? The real question is would you dump the $900 quote as well? Of course not if it is provided by one of the top auto insurers but you may want to make sure that they are quoting on the same bases and there are no catches.

You would think harder when this quote is offered by a company unknown to you. At the end of the day, you would worry that they would struggle to pay claims and find a way out of them. At the end of the day, they are paying the claims out of the premiums collected. And if they cannot collect enough premiums where they would find the money?

Your common sense would kick in and think that they can only save so much money by running an efficient business. Where would they be able to cut the costs? This is a serious and legitimate question to ask yourself. If we go back to the example and say that the lowest premium quote was $1,200 you may reason that it is not much far off from the rests and may be acceptable.

So, the answer depends on your circumstances and what your guts is telling you. If it does not feel right it probably is not. The best advice to give is to get several quotes and line them up. Then you can decide which to dump and which to take.

Most policies sold in the US are known as full coverage. About fifteen percent of motorists buy only liabilities cover. Another fifteen percent don’t purchase any type of coverage at all. This is worrying for people who share those roads with these uninsured drivers. But this is a topic that can take over this article and therefore we are going to leave it out at this time. About seventy percent of drivers buy full cover this mostly include uninsured motorists.

Almost all auto insurance companies sell full cover but their content, terms and conditions can be significantly different. One area you need to carefully look at is the exclusions in your policy. There is a common practice that some companies exclude natural disasters where these are likely to happen. This could create a serious problem for motorists who suffered in one of those storms or hurricanes.

It is probably more understandable if we explain this with an example. Some areas are known for being high risk for certain natural calamities. For example, California is on an earthquake zone. This means that insurers will have to pay large sums of money if cities like Los Angeles hit by an earthquake. So, quite a few policies sold in California excludes earthquake. This doesn’t make sense you probably say and it is true that it doesn’t. Why would you want a policy that excludes one of the known risks?

weather damaged automobileThe problem is that a big quake can cause billions of damages and wipe out insurance companies. In order to protect themselves from this risk they include an exclusion in their policies. There could be similar exclusions in other areas. For example, Louisiana may have a hurricane exclusion. This is a way of controlling the risk as far as companies concerned. There may not be any big calamity for years in certain areas but they cannot take a chance.

The problem is that nobody knows the possible losses if there were one of those big natural disasters happened. Therefore, it is hard to price against such losses. If companies included those risks they have to be on the cautious side and charge large sums of money. This would make the policies sold in this particular state very expensive. Maybe it is more manageable for both policyholders and insurers to exclude certain risks.

Nonetheless, you can still make additions to your policies to include all the natural disasters. The premium will be higher but it is an option available with most providers. The first step is to check if your policy excludes the peril you are most worried about. You may find that it may already include them against all the odds. Then, you don’t need to do anything and don’t worry about being hit by one of them.

Otherwise you contact your insurer or broker and get a quote for including the risks in question. This will tell you how much more premium needs to be paid. At this point you can make your own assessments as to paying up or forgetting about i.

Insurance is a topic of discussion we can have for hours especially when we have a story to tell. Also, a topic that everyone may have an opinion about. Have you heard people saying that it is total waste of money and companies will not pay your claims anyway? If someone says this to you check if that person have coverage or not. Usually, they like to trash talk the insurers but they buy policies themselves anyway because it makes sense and risks are too high to face alone.

It is possible that you read stories on the newspaper or hear from someone that certain company didn’t pay a claim. You shouldn’t take these on their face value. No self-respecting company would refuse a legitimate claim. It is bad for business and they have reputation to withhold. They may have good reasons to refuse a claim. Remember that while there may be one or two lousy insurers but there are millions of people who try to cheat companies and get paid for a damage or injury that never happened.

totaled carsSometimes people may speculate about why their premium is higher. Some may say that because he has a red car and another person may believe it and spread it as if it is a fact. Always check your facts from a reliable source. Specifications of your automobile will affect your premium a lot but not the color. When you have a car that is easy to break into and steal you will pay higher premiums. The same applies when you have a sports car or SUV because these are high risk vehicles. Hence you get charged higher, not because they don’t like the color of your car.

You may just have a speeding ticket and someone may tell you that your insurer will never going to find out about them. This is not true since companies can quickly check your license against DMV records and find out exactly what type of tickets you received and how many points have been deducted from your license. So, it may not be smart to hide it from the companies especially when you are getting quotes. And your policy requires you to inform the carrier of any changes in your circumstances. It is best to talk to them when your penalty has been confirm. They may let it slide this time if it is the only record on your name. Keeping quiet about it is not always the best solution.

some people may not even know what is covered with their policies. You may come across a guy who only has a liabilities only policy and thinks that he is going to get a new car if something happens to his. This brings us to another common misconception. Many policyholders think that they will get a new car if theirs is totaled. This is never true as it would lead to serious fraud and people would keep rolling their old cars off the cliff when it gets old. You would only get as much money as the market value of your car if you were to sell it today. Learn your facts before believing in stories and myths.

There are many accidents in which more than one car is involved. After the incident you will have to quickly assess the situation as to who is at fault. In other words, you or the other driver caused the accident. This is an important task in many aspects. The outcome of being responsible or not will determine who pays the damages and how your auto insurance rates are affected. Let’s have a look at the consequences of each situation.

If you feel like you were at fault and you may want to claim your damages from your own insurer. In order to do that you need to have sufficient coverage to pay for repairs. This would mean that you need collision coverage within your policy in this case. Normally you will need to pay deductibles when you are making damages claims from your own insurer. This may mean that you give up on making claims when the damages are small and your deductibles are close or higher than your damages.

auto insurance claimsIf you are at fault, the other driver can claim his losses from your insurer as well. If you hit his/her car you will have to pay for the damages caused. This is how it works; you break you pay. As you were responsible for the accident and made your insurer pay a lot of money on claims you are now a high risk driver. This will be reflected on your next renewal premium. You will lose your good driver discounts and you may get charged a little extra as well that you shouldn’t be surprised to be hit with large increase in your insurance costs.

Let’s think a completely opposite story where the other driver is responsible. Then, you would want him or his insurer pay for your losses. Why should you suffer for some other people’s mistakes financially. You would suffer a little anyway with losing your car during repairs and having an accident recorded against the vehicle. Besides, you don’t want to pay the deductibles and see your premium increase. So, you make a claim directly with the third party insurer. Even though you may inform your insurer of what happened they will not take this accident into account when preparing renewal quote because they know it wasn’t your fault.

If the third party driver accepts the fault and his insurer pays the repair costs it will be over for you. In some cases you may not be as lucky because the other side may deny being responsible and blame you. Or they may just take too long to deal with your claim that forces you to go to your own insurer. This is possible since you bought coverage for damages but making a claim from your own provider would mean two things. You pay deductibles and your premium increases.

However, your insurer may get the money from the other side insurer at the end. Then, they would return the deductibles you paid and the accident would be recorded as no fault of yours.

Would it be a shock if two similar looking companies were charging completely different rates? Why would that surprise you since you see price differences in almost every industry? You probably come across or have no clue about varying auto insurance quotations. Think about all those TV advertisements. Did you think they were lying when they told you could save fifteen? How about if we tell you could save fifty percent?

What is the point of having hundreds of different companies if they all sold the same product at the same price. Every company comes into market believing that they have a strong point that others don’t have. This could be that their products are well thought off and cover a lot better. Or they may find a way to keep their costs down and charge you less. Some companies don’t have telesales representatives and they only sell policies only. They don’t have to have thousands of staff and large offices to house them. Besides, why would people would want to buy from a company who doesn’t even bother to pick the phone up? The answer is they are cheaper than others.

It is surprising how many motorists think that their premium would be about the same regardless of which company they go. That is why they go straight to one of the biggest ones and buy a policy. Unless they come across somebody with a lot lower premiums they wouldn’t be the wiser and keep paying their premium for years.

The premiums can be hundreds and sometime thousands of dollars different between two companies. This has been tested many a times by brokers and comparison websites. Their findings are eye opening and warning to motorists who doesn’t shop around. In some cases certain companies can quote thousands of dollars for a basic liabilities auto insurance especially if you have a bad driving record or living in the cities. While one company loves cities the other hates them.

When you don’t check your alternatives and keep buying from the same company year after year you may end up paying twenty percent more easily. You may think that you are loyal and therefore the company looks after you better. You may think it wrong as a totally new policyholder with similar details as you can get cheaper quotes than you. You are in the bag and not require much servicing. But new customers need to be attracted with cheaper prices if they were to switch.

There are so many components of an auto insurance price. A few of them is related to the company offering them. It is like processing plants. When you start changing a few things around the quality of the product that comes at the end will change. Companies are different from each other to start with. And each company is fiddling with their system everyday in search of perfection and higher premiums. So, it would be naive to think that prices will be similar and furthermore they will stay the same.

Every driver, automobile and owners particulars are different from each other. While your neighbor gets very attractive rates you may end up being charged large sums of money. In some cases you may even feel lucky to be able to find that expensive policy. This is largely due to risk levels and how have you been driving. When you have had a few accidents and traffic tickets you cannot expect auto insurers queuing to offer you great rates. You are lucky to find few of them willing to insure you.

Companies can classify drivers looking at risk levels. Usually, they group drivers as good, average and bad. Good drivers get offered the best rates possible and can get as low as half the premium of bad drivers. Average drivers would still enjoy good deals. But bad drivers would be hit the hardest with high premiums. Some companies may even prefer off loading them when the policy is due for renewal. Usually they don’t offer renewal terms of offer very high quotes.

The usual problems that makes the division between good and bad are traffic tickets and claims. When you have a few traffic tickets and claims you are expected to have another accident soon and that is why they don’t want to take a chance with you. These could be small incidents that you thought nothing of. But still if you are careless to have the accident in the first place it is only a matter of time that you will have another big one.

finding non-standard policiesSome problems are so serious that you don’t need to do them several times to be hit heavily. For example, if you drink, drive and get caught your license may be taken away from you. As soon as your insurer finds out about your DUI conviction they can cancel your policy with immediate affect. They can also refuse to pay your damages if you involved in an accident.

With a DUI you have only few places you can go for a new policy. Those would be non-standard insurers who are willing to consider higher risks. They may include special condition in your policy like getting a alcohol test device fixed onto your car so that you need to blow into the test kit to make sure you are not drunk. That would be the only way to get your car started.

Also there could be complications due to other factors like the area you live and they car you drive. When a vehicle is modified a lot or it is a well looked after classic they may require special policies to be arranged. They could have different wording on some sections and have various endorsements and conditions that make them non standard. A standard policy is the one can be bought by mot motorists with minimum or no modifications. These policies are sold off the shelf and as it is in most cases.

Standard policies are generally the cheapest ones. The more changes you require and the more complicated your situation is the higher premium gets. You can see standard policies as mass produced products we see every day. And non-standard policies can be seen as custom made clothes or other materials. The custom made items require more attention to detail and therefore they are expensive to buy. Also, they require certain skills to get it right the way customer wants.


Maybe you are thinking that who would know if you could drive a few months without insurance? Or one morning you get up and realize that you need to save money on your budget and first thing you think of is dropping auto insurance? This is a bad idea and you should think twice before going ahead. Your chances of getting caught is very high now that police uses special technology to check which vehicles are insured and which are not.

Then, there is the problem of dealing with claims. Don’t even think about the repairs to your automobile first. Think about the people you caused injures and damages. Who is going to pay for their losses? Do you have thousands of dollars sitting in the bank? Probably not and that is why you don’t want to buy a policy. But it is your responsibility regardless of being insured or not. They will still want compensation even it means it takes thousands of years for you to pay. They will keep taking it out of your wages.

uninsured motoristsConsequences of getting caught without insurance can be very serious depending on which state you are in. Some states will impound your car and you can only take it back when you have proof of insurance. There will be fines to pay as well and there could even be jail sentence if you caused an accident or this was your second offence.

Then, you will have to explain it to every company that you will get quotes to be insured. One of the first questions they ask before they give you a quote is if you are currently insured or not. And if not, when was your last policy. There is no mistaking that they don’t like people who let their policies lapse. In the best case scenario you will have to pay a little more for this choice.

Furthermore, you may not be able to claim for damages if someone else hits your car in some states. A few started adopting no pay no play laws that doesn’t allow uninsured drivers to make a third party claim on other motorists’ policies. It is only fair that you cannot make a claim on other if they cannot make on you. The table can quickly be turned around to penalize you. Think this if you don’t think about all those poor people who may not be paid after you cause an accident.

You cannot buy a policy without the third party auto insurance liabilities coverage. This means you cannot insure your automobile if you don’t insure third parties with a liability cover. Maybe you don’t care because your car is old and not worth a lot of money. Otherwise, you will lose your investment on it if it is totaled or you will have to pay the damages out of your pocket.

So far, you may have only considered one angle of the problem, saving money. But there are a lot more to driving without insurance than saving money. And there are many other ways of reducing your premiums.

It is always important to have a good credit score. This will come up and affect your life in many aspects of it. They are looking into your finances when you apply to rent an apartment, apply for a job, get a credit card, mortgage and insurance. Really, there is no point in arguing that what is your finances got to do with how you can do your job or auto insurance. This is how it works and they love the comfort of knowing that you are paying your debt in time.

If you are not taking care of your responsibilities, bills then maybe you are not reliable enough. As far as auto insurers concern they think you don’t deserve discounts. They may be right and you will start playing up with the premium installments halfway through your term and they will have to cancel it. Or perhaps they will charge you extra for poor credit and they will require you to pay up front. Normally, premiums are due at the time of inception and companies offer credit line when they allow you to pay by installment. When you are considered unreliable they wouldn’t want to offer you a credit line.

You see how quickly we can move from one late bill to a serious financial difficulties down the road. For example, you may either not get a mortgage with bad credit or you may be charged couple points extra interest. Think how much would that be over the terms of a 30 year mortgage. It could be thousands of dollars that you have to work harder to pay for.

The same applies to your auto insurance premiums. You can get much better rates when you have a perfect credit history. So, why pay more if there is a way of getting better prices? You may ask how much could the difference be. We estimate that you could get about twenty five percent less with some companies if you had a perfect score instead of a poor one. This would be different depending on the company you are applying for a quote.

Therefore, you would be aiming to find a company that cares a lot about credit history when you have a good score. And you would be searching for a company that doesn’t give a toss about the fact that your credit score isn’t great. This is another way of managing the damages that is caused by slack financial control. It is all about staying within your budget and handling your money affairs efficiently. There are a few blogs that can help you deal with these problems. You never know you could come out pretty savvy at the end by following one of the programs.

Generally, you can stay out of trouble and deal with small hiccups in your life better when you have some savings. Everyone can have a patchy period when you are changing jobs or looking for a new one. Having some savings will allow you to smooth the transaction better. This is something you may need to work on and put a little money aside.