Should I switch car insurance company?
August 2, 2007 10:28 PM
My insurance premium increased by 75% I think because of one accident!!! Is it possible to lower it back to the way it was or do I have to pay the entire amount because it might be cheaper than switching the agent/insurance company?
I have been driving for over 10 years now with a clean record (no speeding ticket, not even being stopped or even getting hit) but at the end of last year, I was involved in an accident (out of state) during a rainy day in a heavy traffic and I hit the car in front of me. The front car didn't stop despite what I did but my car got a $3000-5000 damage estimate(I forgot cause they increased it afterwards).
Fastforward 6 months or so, the bill from the insurance company went up 75% from $400-700/6mos. With each increase they gave us (which was never this much), it was still fairly lower than if we were to switch, so while I am being pessimistic, I don't think he's going to lower the rate (if he does, prolly very little like 50 bucks and blame it on the market(he's a shmuck))
First, my entire family's been with this agent for almost 20 years for everything but we don't like him for various reasons I'll hold back. Second, if I switch my policy cause they don't lower my rate down, I might have to pay 700 or close to that amount with the other insurance companies even with one accident. Third, I might be risking the rate increase for my parents if I switch.
Should I try to find out the rate if I switched before calling him to lower the rate? What are my options? Is this increase reasonable when they've had my entire family for all kinds of insurance for almost 20 years? I've heard of stories where people with 3-4 accidents didn't get any increase in their premium.
I have been driving for over 10 years now with a clean record (no speeding ticket, not even being stopped or even getting hit) but at the end of last year, I was involved in an accident (out of state) during a rainy day in a heavy traffic and I hit the car in front of me. The front car didn't stop despite what I did but my car got a $3000-5000 damage estimate(I forgot cause they increased it afterwards).
Fastforward 6 months or so, the bill from the insurance company went up 75% from $400-700/6mos. With each increase they gave us (which was never this much), it was still fairly lower than if we were to switch, so while I am being pessimistic, I don't think he's going to lower the rate (if he does, prolly very little like 50 bucks and blame it on the market(he's a shmuck))
First, my entire family's been with this agent for almost 20 years for everything but we don't like him for various reasons I'll hold back. Second, if I switch my policy cause they don't lower my rate down, I might have to pay 700 or close to that amount with the other insurance companies even with one accident. Third, I might be risking the rate increase for my parents if I switch.
Should I try to find out the rate if I switched before calling him to lower the rate? What are my options? Is this increase reasonable when they've had my entire family for all kinds of insurance for almost 20 years? I've heard of stories where people with 3-4 accidents didn't get any increase in their premium.
Excellent advice from IvyMike, and I'll only emphasize that shopping for a good car insurance rate is a lot like hunting for a job -- almost all the options you explore won't pan out, but the more persistent you are the closer you'll get to a good deal. Try each provider; tell each provider that doesn't beat the rate you used to pay that you can't believe they're serious; offer to entertain better offers tomorrow once they've slept and come to their senses. A little optimistic negotiation may very well go a long way in your situation.
posted by gum at 11:23 PM on August 2, 2007
posted by gum at 11:23 PM on August 2, 2007
What state are you in? How old are you? How old is the car you're insuring, and what's the make and model?
posted by bshort at 6:55 AM on August 3, 2007
posted by bshort at 6:55 AM on August 3, 2007
Talk to your agent... he may not actually be responsible for the increase, and he may be able to help you get your rate reduced. Once upon a time, I was hit by an underage drunk driver. In the course of the investigation it was discovered that my license was suspended (a complete shock, I had paid a speeding ticket a couple of days late in a neighboring podunk county). Both the girl who hit me and I had the same insurance- State Farm. They were not pleased.
I quickly remedied my license situation, and explained to my insurance agent what had happened. She said that my premium might go up, but they wouldn't drop me. Then a couple of days later I got a letter, as did my mother, that stated they were dropping me, and would drop my entire family unless they signed affidavits that I would never drive their cars (we were on a family plan).
My mom called the agent in a rage and threatened to pull the 5 cars and two houses that were insured by State Farm. The agent was bewildered, and after checking discovered that the letter had been sent from the home office. A week later I got a letter stating that because of "being a good customer for many years" I would never be denied coverage from State Farm. In fact, my premium didn't even go up.
Three years later when I moved to a new state and bought a new car, I had no problems getting insured with State Farm there.
posted by kimdog at 7:33 AM on August 3, 2007
I quickly remedied my license situation, and explained to my insurance agent what had happened. She said that my premium might go up, but they wouldn't drop me. Then a couple of days later I got a letter, as did my mother, that stated they were dropping me, and would drop my entire family unless they signed affidavits that I would never drive their cars (we were on a family plan).
My mom called the agent in a rage and threatened to pull the 5 cars and two houses that were insured by State Farm. The agent was bewildered, and after checking discovered that the letter had been sent from the home office. A week later I got a letter stating that because of "being a good customer for many years" I would never be denied coverage from State Farm. In fact, my premium didn't even go up.
Three years later when I moved to a new state and bought a new car, I had no problems getting insured with State Farm there.
posted by kimdog at 7:33 AM on August 3, 2007
Third, I might be risking the rate increase for my parents if I switch.
Cost concerns aside, you should ditch this agent / insurance company soon. That fact that you suspect they might take revenge on your parents' rates because you left says a lot about them.
I'm with Progressive - after a similar record to yours, I had an accident last year and my rates went DOWN. When going through the policy docs, I read that they removed the accident from my record because I had been a good customer for X number of years. So the scheduled rate decrease (due to my age, I guess) went through as planned. I'm currently paying about $450/6 months, you should definitely check into them.
posted by chundo at 8:08 AM on August 3, 2007
Cost concerns aside, you should ditch this agent / insurance company soon. That fact that you suspect they might take revenge on your parents' rates because you left says a lot about them.
I'm with Progressive - after a similar record to yours, I had an accident last year and my rates went DOWN. When going through the policy docs, I read that they removed the accident from my record because I had been a good customer for X number of years. So the scheduled rate decrease (due to my age, I guess) went through as planned. I'm currently paying about $450/6 months, you should definitely check into them.
posted by chundo at 8:08 AM on August 3, 2007
That fact that you suspect they might take revenge on your parents' rates because you left says a lot about them.
Likely he's not talking about revenge but rather a multi-car discount, which is fairly common.
However, I was long ago in a similar situation to you - the family agent was a complete tool who was at best incompetent and at worst obstructionist. Kicking him to the curb was the best thing I did, and I didn't even have to leave State Farm to do it.
I went to another agent and told him I wanted to move. When he discovered I was with a local agent he was very reluctant - an admirable professionalism. I told him that in no uncertain terms that within a month I would no longer be with that agent even if it required switching insurance companies. If it made him more comfortable I'd write a letter detailing my displeasure with my old agent but I'd just as soon simply vote with my dollar.
He took me on and the difference was simply astonishing. I think that was my first lesson in the value of not rewarding mediocrity with my money. You might improve your situation by simply switching agents too - worth a look, as you comparison shop insurance companies.
posted by phearlez at 8:35 AM on August 3, 2007
Likely he's not talking about revenge but rather a multi-car discount, which is fairly common.
However, I was long ago in a similar situation to you - the family agent was a complete tool who was at best incompetent and at worst obstructionist. Kicking him to the curb was the best thing I did, and I didn't even have to leave State Farm to do it.
I went to another agent and told him I wanted to move. When he discovered I was with a local agent he was very reluctant - an admirable professionalism. I told him that in no uncertain terms that within a month I would no longer be with that agent even if it required switching insurance companies. If it made him more comfortable I'd write a letter detailing my displeasure with my old agent but I'd just as soon simply vote with my dollar.
He took me on and the difference was simply astonishing. I think that was my first lesson in the value of not rewarding mediocrity with my money. You might improve your situation by simply switching agents too - worth a look, as you comparison shop insurance companies.
posted by phearlez at 8:35 AM on August 3, 2007
There are a number of reasons your premium went up. I'm going to go on conjecture here, because I don't know much about your current situation (age, family situation, etc.).
First, I'm betting that the reason your insurance went up so much is because of a number of reasons, not just this accident. Likely, you had some kind of "good driver discount." So, not only did you have a rate increase when you had an accident, but you probably lost your good driver discount. That's the only thing I can think that caused your insurance to go up that much.
Second, it's possible that when you got into the accident they re-ran your risk score and also took into account new information like your current credit rating. You have to keep in mind that the company takes this into account when they sign you up, but then don't do it again until something causes them to re-asses your risk to the company. If your credit score has gone down, then your rate is going to go up.
Third, do not blame this on the agent. They have nothing to do with the price of your policy. Agents merely read off the screen what the computer tells them, based on what you tell them and how the computer assesses your risk. The home office re-assessed your risk and sent the new price. Simple as that.
Moreover, how long you've been with a company has little to do with anything after a certain point. Some companies offer loyalty discounts, but just because you've been with them for 20 years doesn't mean they're going to cut you a break. This is business in the 21st century, not in 1950.
Fourth, before you go off and do something crazy, go in and TALK to the agent and ask them to explain the rate increase. We here on can only tell you what we can guess about. Your agent is the one who can explain the facts to you. So call the agent, make an appointment, and talk to them. While you're there, ask them if your parents insurance costs will go up if you change carriers. If he says yes, ask him to show you what discounts would cause that. If you're not actually on your parent's policy, I'd find it hard to believe that you changing companies would affect them at all.
Finally, as others have said, if you're going to shop around do it all at once. There will be no "leverage" with your current agent -- as I said above, he has no power over your rate -- but at least you can make an informed decision before you change carriers. Be completely honest with them if they ask if you've had an accident, because if you're not, and it shows up a few weeks/months later, they'll drop you and then you'll have a MUCH more difficult time getting coverage.
Bottom line is that YOU rear-ended someone. Regardless of what you feel, it's your fault that this happened. Keep that in mind before making any decisions out of anger.
posted by PandemicSoul at 9:27 AM on August 3, 2007
First, I'm betting that the reason your insurance went up so much is because of a number of reasons, not just this accident. Likely, you had some kind of "good driver discount." So, not only did you have a rate increase when you had an accident, but you probably lost your good driver discount. That's the only thing I can think that caused your insurance to go up that much.
Second, it's possible that when you got into the accident they re-ran your risk score and also took into account new information like your current credit rating. You have to keep in mind that the company takes this into account when they sign you up, but then don't do it again until something causes them to re-asses your risk to the company. If your credit score has gone down, then your rate is going to go up.
Third, do not blame this on the agent. They have nothing to do with the price of your policy. Agents merely read off the screen what the computer tells them, based on what you tell them and how the computer assesses your risk. The home office re-assessed your risk and sent the new price. Simple as that.
Moreover, how long you've been with a company has little to do with anything after a certain point. Some companies offer loyalty discounts, but just because you've been with them for 20 years doesn't mean they're going to cut you a break. This is business in the 21st century, not in 1950.
Fourth, before you go off and do something crazy, go in and TALK to the agent and ask them to explain the rate increase. We here on can only tell you what we can guess about. Your agent is the one who can explain the facts to you. So call the agent, make an appointment, and talk to them. While you're there, ask them if your parents insurance costs will go up if you change carriers. If he says yes, ask him to show you what discounts would cause that. If you're not actually on your parent's policy, I'd find it hard to believe that you changing companies would affect them at all.
Finally, as others have said, if you're going to shop around do it all at once. There will be no "leverage" with your current agent -- as I said above, he has no power over your rate -- but at least you can make an informed decision before you change carriers. Be completely honest with them if they ask if you've had an accident, because if you're not, and it shows up a few weeks/months later, they'll drop you and then you'll have a MUCH more difficult time getting coverage.
Bottom line is that YOU rear-ended someone. Regardless of what you feel, it's your fault that this happened. Keep that in mind before making any decisions out of anger.
posted by PandemicSoul at 9:27 AM on August 3, 2007
Pandemic - while odds are that if you hit someone from behind it's your fault it could be that icollectpurses was struck from behind and propelled into the car in front. You do not need to be at fault in an accident to have it result in a premium increase, unfortunately.
Third, do not blame this on the agent. They have nothing to do with the price of your policy.
...
Fourth, before you go off and do something crazy, go in and TALK to the agent and ask them to explain the rate increase. We here on can only tell you what we can guess about. Your agent is the one who can explain the facts to you.
While the agent does not set price, the agent is in a position to help his/her customer find the most advantageous plan, identify potential discounts, and in general be helpful. The unfortunate reality, however, is that insurance agents serve dual masters and often behave in a manner looking for maximum short-term profit over long-term customer retention and satisfaction.
I can tell you from personal experience that it's very possible icollectpurses' agent CAN'T (or won't) explain the facts. The industry has a lot of agents who just muddle along and do not identify their customer's needs or help them in comparison shopping or rate reduction. So while our questioner should contact hir agent it's possible he'll be no help at all. I'm projecting based on my own past difficulties but I just want to underscore why it's important to have a good agent.
Be completely honest with them if they ask if you've had an accident, because if you're not, and it shows up a few weeks/months later, they'll drop you and then you'll have a MUCH more difficult time getting coverage.
If only it was that minor. Your insurance company may well collect your premiums for years until such time as you require a payout. If they discover you've fibbed at that point you can find yourself without coverage even if you've paid every requested penny. NEVER NEVER NEVER fib on your insurance documentations, the potential risk is way higher than the reward.
posted by phearlez at 11:32 AM on August 3, 2007
Third, do not blame this on the agent. They have nothing to do with the price of your policy.
...
Fourth, before you go off and do something crazy, go in and TALK to the agent and ask them to explain the rate increase. We here on can only tell you what we can guess about. Your agent is the one who can explain the facts to you.
While the agent does not set price, the agent is in a position to help his/her customer find the most advantageous plan, identify potential discounts, and in general be helpful. The unfortunate reality, however, is that insurance agents serve dual masters and often behave in a manner looking for maximum short-term profit over long-term customer retention and satisfaction.
I can tell you from personal experience that it's very possible icollectpurses' agent CAN'T (or won't) explain the facts. The industry has a lot of agents who just muddle along and do not identify their customer's needs or help them in comparison shopping or rate reduction. So while our questioner should contact hir agent it's possible he'll be no help at all. I'm projecting based on my own past difficulties but I just want to underscore why it's important to have a good agent.
Be completely honest with them if they ask if you've had an accident, because if you're not, and it shows up a few weeks/months later, they'll drop you and then you'll have a MUCH more difficult time getting coverage.
If only it was that minor. Your insurance company may well collect your premiums for years until such time as you require a payout. If they discover you've fibbed at that point you can find yourself without coverage even if you've paid every requested penny. NEVER NEVER NEVER fib on your insurance documentations, the potential risk is way higher than the reward.
posted by phearlez at 11:32 AM on August 3, 2007
Seconding PandemicSoul and phearlez, but actually - in most states, if you are not at fault for the accident, your rates will not (or should not) increase (though each insurance company can set certain standards within state law, in most states, you have to be at least 51% at fault and have caused damages above the accident threshold to be chargeable). If icollectpurses had been hit from behind and propelled into the next vehicle, then the driver of the rear vehicle would have been at fault, and therefore responsible for the repairs to all other vehicles damaged in the accident.
The unfortunate reality, however, is that insurance agents serve dual masters and often behave in a manner looking for maximum short-term profit over long-term customer retention and satisfaction.
You've been dealing with some really short sighted agents, phearlez. The profit on retention is far greater than that of new business, so at my agency, we really work hard at making sure that our clients are well informed and have the best coverage at the best price - it may not always be the least expensive, but I stand behind my company's reputation for service and standards, and I believe that the resulting policy is worth both my time and my clients' money if I'm doing my job correctly. My agency has to write six new business policies for every two long term policies that we lose. If we could retain every policy on our current book of business, we'd never have to write another new business policy.
icollectpurses, think of the things that you want in an insurance agent before you go for quotes. Do you want to be able to walk into a local agency, or do you like being able to do everything online? Is it important that your policy be with a top five company (State Farm, Allstate, GEICO, et al), or is it more important for you to find the cheapest rate possible, regardless of the service you're getting? Figure that out, then shop around. Do it all at once, and be honest about your driving record because they're going to find out anyway, and then as long as the company is reputable (check AM Best or Demotech for the current rating) and you're comfortable with everything, make the switch.
posted by mewithoutyou at 12:36 PM on August 3, 2007
The unfortunate reality, however, is that insurance agents serve dual masters and often behave in a manner looking for maximum short-term profit over long-term customer retention and satisfaction.
You've been dealing with some really short sighted agents, phearlez. The profit on retention is far greater than that of new business, so at my agency, we really work hard at making sure that our clients are well informed and have the best coverage at the best price - it may not always be the least expensive, but I stand behind my company's reputation for service and standards, and I believe that the resulting policy is worth both my time and my clients' money if I'm doing my job correctly. My agency has to write six new business policies for every two long term policies that we lose. If we could retain every policy on our current book of business, we'd never have to write another new business policy.
icollectpurses, think of the things that you want in an insurance agent before you go for quotes. Do you want to be able to walk into a local agency, or do you like being able to do everything online? Is it important that your policy be with a top five company (State Farm, Allstate, GEICO, et al), or is it more important for you to find the cheapest rate possible, regardless of the service you're getting? Figure that out, then shop around. Do it all at once, and be honest about your driving record because they're going to find out anyway, and then as long as the company is reputable (check AM Best or Demotech for the current rating) and you're comfortable with everything, make the switch.
posted by mewithoutyou at 12:36 PM on August 3, 2007
Try Esurance.com. I just switched from a traditional Farmers policy, and saved over $4000/yr for a single car (I had a 'few' dings...)
posted by growabrain at 9:02 AM on August 4, 2007
posted by growabrain at 9:02 AM on August 4, 2007
My brother called the agent for his insurance issues and he told my brother that my increase was due to the accident in October. After I got out of my parents' policy, my own premium went up, I guess because by myself I don't get general joint discount or something, and now it's 75% higher...I don't think this number makes any sense. And for my agent should've been informed of this increase at least at at the same time as me but I don't hear about it to explain the 75% increase.
I really appreciate every one's great answers. My parents and I have thought about switching agent or the agency during the past several years. We haven't done it because it would be too much of a headache and my current company is a big size company (Nationwide). The service, however, isn't reflective of what they preach. Really disappointed that they just slip me a bill and say pay because of your first accident, let me try to get as much as I can out of it.
posted by icollectpurses at 9:52 AM on August 4, 2007
I really appreciate every one's great answers. My parents and I have thought about switching agent or the agency during the past several years. We haven't done it because it would be too much of a headache and my current company is a big size company (Nationwide). The service, however, isn't reflective of what they preach. Really disappointed that they just slip me a bill and say pay because of your first accident, let me try to get as much as I can out of it.
posted by icollectpurses at 9:52 AM on August 4, 2007
My parents and I have thought about switching agent or the agency during the past several years. We haven't done it because it would be too much of a headache and my current company is a big size company (Nationwide).
You can switch agents w/o switching agencies - I did. You shouldn't even need to involve the insurance company themselves, though you certainly can if you wish. I assure you that Nationwide isn't going to refuse to let you work with another agent at the cost of losing your business.
posted by phearlez at 6:56 AM on August 6, 2007
You can switch agents w/o switching agencies - I did. You shouldn't even need to involve the insurance company themselves, though you certainly can if you wish. I assure you that Nationwide isn't going to refuse to let you work with another agent at the cost of losing your business.
posted by phearlez at 6:56 AM on August 6, 2007
This thread is closed to new comments.
Also, look into how low your deductible is, and how the rate changes when you raise it. Most people have their deductible set far too low.
posted by IvyMike at 11:16 PM on August 2, 2007