Smart Buyers know that it's wise to 'shop around' before making major purchases.
And buying or renewing a car insurance policy definitely falls in the category of major spending.
That said, the importance of shopping around for car insurance isn't well understood by most 'shoppers.'
Your car insurance premiums --- what you don't know can cost you is an eye opener, and clicking on and reading the below referenced study by Consumer Reports is well worth the time:
"Car insurance costs can add up, and there’s no shortage of experts
advising drivers how to keep costs down, but are you really saving when
you think you are?
What you probably don’t know is that your
credit score — that number representing your creditworthiness and used
to determine rates on personal loans and mortgages — can impact your car
insurance rates. . . .
Consumer Reports has released findings of a study looking at 2 billion price quotes from more than 700 companies and how you can get the best rates. . . .
Among the key findings:
Rates swing based on credit score and which state you live in
with just “good” credit scores paid $68 to $526 more than similar
drivers with the best credit scores, depending on what state they called
home. . . .
Taking an example in Florida, adult single drivers with a
clean driving record and poor credit paid $1,552 more on average than
if the exact same drivers had excellent credit and a drunken driving
conviction. . . .
a consumer faces a ruined score due to divorce, job loss or bankruptcy,
he/she can request that the insurance company waive the score in
calculating the premium.
These exceptions for extraordinary life
circumstances are protections the insurance industry put into place,
but few consumers seem to understand or exercise them. Despite about one
million bankruptcies and one million divorces last year, according to
Consumer Reports, insurance firms might get just one request a month
among its thousands of policy holders. Other companies surveyed didn’t
appear to keep any records of such requests.
Bundled savings? Student discounts?
might think advertisements about bundling your various insurance
policies or good student driver habits can save you money. But Consumer
Reports says they don’t, despite a $6 billion annual spend on
A typical policyholder would save just $97 a year by
bundling home and car insurance. Student-driver training discounts are
worth very little — a mere $63 in annual savings nationally for CR’s
sample family.. . .
practices are pricing consumers out of the market,” says Norma Garcia,
senior attorney and manager of the financial services program at
Insurance companies often create their own
scores based on criteria they establish, making them different from FICO
scores that consumers often access."
To repeat, you should spend some time reviewing the Consumer Reports article referenced above. You'll be glad you did.
It's absolutely a Caveat Emptor world out there when it comes to buying car insurance, and Smart Buyers are well advised to be guided accordingly.
Sellers of insurance will charge what the market will bear, and 'long term, loyal and satisfied' customers who don't routinely 'shop around' will end up paying the most. It's sad but true
As a result, Smart Buyers will 'shop around.'
Let's resolve to be both well informed and aggressively acting in our own best interests when purchasing or renewing car insurance or anything else.
That's my take.