My Car Insurance Agent is Lazy, Can I Comparison Shop on my Own?

Many people never engage in comparison shopping for car insurance. In fact, many car insurance customers go with the first agent they find. Perhaps they were recommend by a friend, or worse yet, the agent has served your family for generations - his great grandpa might have even sold buggy insurance to your mother’s uncle’s great cousin by marriage (it’s a long story).

The problem with an auto insurance agent like this is that he is unlikely to fight for your business. He undoubtedly considers you a “captive customer” and he isn’t going to offer you the best car insurance rates, or even ensure you’re getting the best coverage for your premium dollars.

Car insurance is a competitive industry - make your agent compete for your business! If you don’t, then you have no one but yourself to blame for paying too much.

Understand Your Coverage

The first step in getting the best car insurance rates is to understand your current coverage. Go to your file cabinet and find your “dec sheet” - the one page document that explains all of your coverages, limits, and endorsements. If you can’t find your dec sheet, call your agent and have him fax it over to you, or drop by his office and ask for a copy. This act alone will show him you mean business and that he can’t take your patronage for granted anymore.

Once you have your hands on your dec sheet, review your coverages. You will have separate coverages for liability, medical payments, uninsured motorists, and damage to your auto. You can find out more about these four distinct coverages at this web site.

Begin Comparison Shopping

Now that you know what you have and how much you’re paying, you can begin to comparison shop. Use the internet to get free automated quotes, and also speak directly to at least five insurance agents from no less than three different companies. Subtly make it known that you are comparison shopping, and these agents will do all they can to find you the best car insurance rates. After all, the insurance industry is highly competitive, and the internet has made it even more so. While there are still plenty of customers who are clueless as to their coverages, they are becoming an endangered species, and agents are learning that they will have to fight for your business.

Determine How Much and What Kinds of Coverage You Actually Need

While having too little coverage is the more common sin, having too much or the wrong kind of coverages can be almost as costly. For example, if your car is worth less than $5,000, do you really need to be paying for $10,000 of collision coverage? If you think your insurance company will pay you $10,000 if your $5,000 car is totaled, you’re wrong - they will only pay you the replacement value. Car insurance is not designed to enrich you, it is designed to “make you whole.” Your car insurance company will gladly accept inflated premiums for $10,000 worth of collision coverage on your $5,000 car, but when it comes time to pay you, you’ll only get a maximum of $5,000.

In fact, if your car is worth less than $2,000, you might really want to consider whether or not you want collision or comprehensive coverage at all. After all, the higher car insurance rates may not justify the benefit since you won’t be out much even if you car is totaled.

Car insurance is a financial product, and you need to evaluate your coverage like a Wall Street trader evaluates stocks or bonds. What are the risks and rewards? You don’t want to have too little coverage, but you don’t want to be sending your insurance agent’s kids to college either. Especially when the lazy bum won’t even pick up the phone!