Why is there an extreme price differences on insurance quotes?
I did 4 different quotes on full coverage insurance for my 05 Ford Truck, ALL Quotes are the EXACT same coverage, the most expensive is $973 and the least expensive is $319 for 6 months.
Why are the rates so different in prices?
Just out of curiosity, is that $973 for six months?
That is a HUGE range in premium. There are a couple things that could cause that, assuming you did triple check the coverages to match:
1. policy term – maybe one is for 12 months, and one is for 6.
2. payment plans – maybe one is giving you a paid in full discount, and one is giving you installment charges added in
3. estimated premiums – maybe one checked into your driving record and credit score already, so it’s an ACCURATE quote, and the other just gave you an estimated quote, and will check your credit & driving record later, after you commit to the policy.
Also, some companies just TARGET certain demographics. They decide they WANT to write them, and they’ll discount rates for that demographic. Example: Progressive. If you are 40, single, male, have one DUI, no other driving incidents, and a fantastic credit score, Progressive can’t be BEAT. They are way, way, way cheap for this demographic. They’ve decided it’s probably a fluke, you’re responsible, and it won’t happen again. And they’re making money hand over fist, because all the OTHER companies out there are, well, charging like you have a DUI.
That’s why there really is NO shortcut for finding the best rate for YOU – different companies target different demographics.
There can be several reasons but I’ll come up with 3 of those…
1) Some companies are more aggressive in certain areas and for certain people. Some carriers are more willing to insure certain risks then others (certain drivers, writing in certain areas, etc) so they offer lower prices. Some carriers are the opposite and don’t really want that type of risk.
2) The policies carriers can issue can be highly modified. This is the part that no one sees until they are in an accident and by then they have been paying premiums already. Some carriers don’t modify policies very much so they actually offer much better coverage. One quick example: the standard ISO policy does not exclude coverage for carrying property for hire. I found out a few years ago that Progressive’s policy does exclude this coverage. By Progressive excluding this coverage their over-all exposure is less so they can decrease their rates slightly.
3) The carrier cuts corners where ever they can… usually in the claims dept. So you have inexperienced adjusters trying to do way too much work. Call these carriers and you will never be able to speak to an adjuster. Also, the claim take much longer to process. Again, you don’t know this until you file a claim and if your filing a claim the carrier probably wants you to drop the policy.
References :
Just out of curiosity, is that $973 for six months?
That is a HUGE range in premium. There are a couple things that could cause that, assuming you did triple check the coverages to match:
1. policy term – maybe one is for 12 months, and one is for 6.
2. payment plans – maybe one is giving you a paid in full discount, and one is giving you installment charges added in
3. estimated premiums – maybe one checked into your driving record and credit score already, so it’s an ACCURATE quote, and the other just gave you an estimated quote, and will check your credit & driving record later, after you commit to the policy.
Also, some companies just TARGET certain demographics. They decide they WANT to write them, and they’ll discount rates for that demographic. Example: Progressive. If you are 40, single, male, have one DUI, no other driving incidents, and a fantastic credit score, Progressive can’t be BEAT. They are way, way, way cheap for this demographic. They’ve decided it’s probably a fluke, you’re responsible, and it won’t happen again. And they’re making money hand over fist, because all the OTHER companies out there are, well, charging like you have a DUI.
That’s why there really is NO shortcut for finding the best rate for YOU – different companies target different demographics.
References :
agent, 21+ years