Can you guess the most dangerous activity most Americans perform on a regular basis? You guessed it, driving! We casually hop behind the wheel of our 3000+ pounds of manufactured metal and drive at incredible rates of speeds alongside thousands of other drivers doing the exact same thing. Given the dangers, it is no surprise that auto insurance is perhaps the most accessible insurance product on the market.
Driving is our primary form of transportation and keeps the country moving. As a result, auto insurance has been deemed such a necessity, it is legally required in all 50 states. And while the understanding of auto insurance has become increasingly convoluted, it is more important than ever. This is due mostly to the fact that our interaction with driving is evolving. Ridesharing and texting & driving alone have dramatically changed the scope of the industry. Sure, vehicles are getting smarter and safer, but that technology is also increasing the cost of repairs. When these lifestyle shifts occur, client buying behaviors have to be altered as well. Auto insurance is the only line of defense when driving. And quality protection has to be selected before its needed, to ensure it can be effective.
When talking about auto insurance, the elephant in the room must be addressed. Price. The number one issue plaguing the auto insurance industry is the topic of cost. We live in a time where selling a policy has become more important than client safety. Marketing gimmicks focused on distraction or the promise savings is valued higher than getting drivers the protection they need. This message that has left the majority of insurance customers infatuated with the idea of finding low-cost insurance. The focus is solely on price, and not the coverage being obtained. This mentality is not only dangerous but is a recipe for disaster. Most only realizing that fact after it’s too late. Auto insurance needs to be understood and selected carefully.
Most don’t realize that quality auto insurance is not overly expensive. In many cases, the prices are comparable or sometimes less than cut-rate insurance policies. It just needs to be addressed in a more intelligent way. The reality is, not all insurance companies are created equally. Each company has their own version of policy language. This unique language is what sets the groundwork for a number of benefits that are available when a claim occurs. By choosing insurance simply due to its low cost, it is likely the policy language is less favorable and will ultimately offer less coverage. By understanding the policy language, you can separate client friendly companies from profit-focused companies. It is just a matter of knowing which companies are which. Fortunately, we have spent our entire careers researching this very topic and would be happy to share that insight with you!
We think you probably know what we are going to say but, YES! Auto insurance coverage matters a great deal. So often we hear people say things like, “I don’t care about my car, so I just need the lowest coverage.” Or, our personal favorite, “I’m not going to get in an accident, so I just need the cheapest policy.” The reality is, auto insurance covers more than your car, and accidents are always unexpected. When you purchase auto insurance, you are buying a policy that is protecting you, and your livelihood. If you are in an accident and the cost of the damages exceeds the coverage in place, you are personally responsible for paying the difference. If that money is not available in cash, they can seize property, put liens on future earnings, or sue for additional damages. Essentially putting your financial health on the line to save a few bucks on your insurance. We promise you, it is not worth it!
Requesting the “cheapest” or “most basic” auto insurance policy is the equivalent of giving your permission to have a horrible claims experience. Leaving your coverage to the interpretation of the agent, often a stranger is an unnecessary risk. If that agent does not ask the right questions, does not provide a comprehensive review, or simply isn’t in the mood to care, it’s you that will pay the price.
Auto insurance is protection for you, your passengers, and your vehicle. Take the time to learn about the coverage before you need it. We promise, taking a few minutes now, will be well worth it when the coverage is needed.
More often than we care to admit, we see people purchase auto insurance on a “penny smart, dollar foolish” basis. Meaning, the primary objective when obtaining auto insurance is a low cost. Like any other product, the lowest cost is often the lowest for a reason. In the case of auto insurance, it can mean there is a lack of coverage, less favorable policy language, or even incorrect rating information. As driving is one of the most dangerous activities performed, shopping solely on price, is a ticking time bomb. It's just a matter of time.
You must understand that each insurance company is different. Some can offer very favorable claims settlements, others cannot. That’s why it is so important to understand what type of policy you have, and the same reason why we only work with highly reputable companies. There is a difference, but quality coverage does not have to be expensive. In many cases, you can obtain a more quality auto insurance policy for only a small pricing difference.
Ultimately, we encourage everyone to remember what you are getting when looking for insurance. You are not simply buying a policy. It is not a line item on the monthly budget. You are buying an experience. When you are putting your auto insurance policy together, you are putting together the type of experience you want to have when the worst things in life occur. It can be a positive experience or poor experience. But either way, it is up to you. Luckily, we are experts at constructing a positive experience!