Auto and Homeowners Insurance:
An Insiders Guide to buying Auto and Home Insurance Online.
As an Internet shopper and insurance agent, I will be the first to praise online insurance shopping. At it's best you will be able to get multiple quotes, compare and find the best insurance for you quickly, easily and with a minimum of hassle.
At it's worst, looking for insurance online will be a total nightmare. Imagine 15 to 20 agents calling multiple times a day trying to schedule in home appointments that last hours. Yes, this actually happens. But not for you because I am going to share a few secrets with you. Follow these guidelines and we will make finding the right insurance a breeze.
1. Who exactly are you clicking on?
Hey, good question. There are three types of companies that advertise for insurance quotes on the Internet, Brokers, agents and resellers.
A broker is a licensed insurance agent that represents more than one company.
For example my company, Insurance Resource Center, is a brokerage. I sell health insurance in Colorado and represent 10 insurance companies. This way I can provide non-biased advice as to which company is a better fit.
Agents represent one company. This is usually what you are going to find in looking for Auto and Home insurance. Allstate, State Farm, Farmers and American Family are all examples insurance companies that have exclusive or captive agents. So when they call you, be aware they have one company to present to you.
Resellers are companies that get your quote and distribute them to a set number of agents who pay for the right to give you a quote. This is actually a good thing and this is also something we do. In fact we partner with two companies InsureMe and 2Insure4less. For those of you in Canada, we use Kanetix. These are very good companies to use because they screen their agents and only sell the leads to 3 agents at most.
We started doing this for a number of reasons. We offer Health and Life in Colorado and wanted to provide a resource for our clients who:
1. Are moving to another state.
3. Want to do research for a neighbor or relative.
4. Don't want to go down a phone list leaving messages with insurance companies.
So, lesson one: know what you are clicking on and don't click a bunch links or you will get flooded with calls. ( Click 10 links= 30 agents.)
In fact, these are the only links you need.
If you do this, you will get a very manageable number of quality responses online. Now, what to do with them.
2. Set the Ground Rules.
You need to establish the rules, not the agent. Unless you have a weird fascination with talking to insurance people, don't answer the phone. Yes, I know you want quotes but stay with me on this. When you submit a quote for Auto and Home insurance, the phone will start ringing. Some agents will call as soon as they get the lead, others will call a few days later. You are in an information gathering stage at this this point so scheduling appointments is a bad idea. Don't waste time listening to sales pitches.
Here is what you want to do:
1. Specify in your quote request that you want emails only, no phone calls.
2. Make sure the limits quoted are what you requested.
3. If you are getting home quotes, consider getting the auto quotes too because combination policies are often times a better way to go. Here is a good place to get home quotes and auto quotes.
4. Make notes on who calls. If they don't respect your rule, discard them. If they leave a short message asking if you received their quote, that's okay. If they sound nice, keep them. If they sound "salesy", toss them.
3. Evaluate and email questions
So now you are rolling. Because you clicked on one or two quality links, you are going to get a variety of companies responding to you but not too many. Also, you are not going to be wasting time talking to agents on the phone and setting needless appointments. This gives you time to compare quotes and ask questions. I prefer emailing questions because this way you get an answer and not a sales pitch.
Here is what you want to do. Narrow your choices.
Throw out any cheesy or outrageous quotes. Most auto and home policies are very similar in nature and are quoted the same way so it is pretty easy to weed out the undesirables. This should leave you with 2 or 3 similar insurance quotes.
Email the agents. Here are some good questions to ask.
1. " Your quote is very similar to Company X. What are some of the differences I should know about?"
2. " Why is your quote lower/ higher than company X"?
3. "What is the cost of Auto/ Home insurance separately and what is it together?"
4. "Is the homeowner's quote with replacement value or actual value?"
You want to do this for 2 reasons.
1. Each agent is taught to sell their product and also how to sell against other companies. They can provide some pretty good information as to gaps in their competitor's plans. They can also lie. That is why you should take any statement with a grain of salt and verify it with the insurance company.
Example: " Well you know that quote from company C is not going to cover your roof."
Email the agent from company C and ask them that question directly.
Usually when asking a question point blank, you will get an honest answer.
2. How fast and accurately does the agent respond to your emails? This is a great indication of how you will be treated after the sale.
3. What kind of "feel" do you get from the agent? Basically, what impression does this person give? To me, it has never mattered how long an agent has been in business. Insurance is a weird industry. Everyone seems to have been an agent at some time.
New agents may not know answers but will readily get them for you. I would much rather have an agent admit they don't know something than one who just makes up an answer to get a sale. If it doesn't sound right, that is a red flag. Call another agent from the same company to verify.
Older agents can literally be dinosaurs. They have built up a book of business and they have coasted for years. Especially in today's world, make sure if you are talking to an older agent, that they are computer literate. By this time, you have probably weeded them out already.
4. How are rates determined?
This is where things get weird. Health and life insurance is based upon your health. Makes sense. Home and Auto insurance quotes are based upon a bunch of factors including:
- Your age
- Your Zip Code
- Your credit report
- Type of Car / home
- " Life Style" questions such as drug and tobacco and alcohol use
- History of claims for your area.
- Size of home, materials, add-ons, what kind of roof etc...
With that being said, every company has different statistics so you can get huge differences in quotes. Make sure you are comparing "apples to apples".
I think it is very acceptable to fax over your present coverage and get an accurate comaprision that way.
5. How can I lower the cost of insurance
- Higher deductibles can save you a ton of money. Going from a $250 deductible to a $500 deductible or higher. Usually the amount of money you save in the first year or two will make up for the difference.
- Take time and insure your valuables for what they are really worth. Yes you may pay a few dollars more each month but it is more than worth it in the long run.
- Get discounts for security systems, good grades, etc... There are a number of discounts companies give out. Take advantage of them.
- Find an agent you are comfortable with and gives you good advice. If they are acting in your best interest, they will help you save money.
Conclusion
Now hopefully you have a good idea of the following:
There are a number of variables with this. The most important thing to do is get started and for that I recommend clicking on Insure Me. I have personally met with them and have been very impressed with how they do business. Quotes Auction is another reputable company to use.
Please remember this:
- You are never under any obligation take accept any of these quotes.
- You are never under any obligation to meet with anyone.
I want to thank you for reading this and I wish you the best of luck.
Here are some good resources for you.
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Copyright 2001 Insurance Resource Center Inc. All rights reserved
