Auto Insurance

jevb · #1 (**permalink**) 08-24-2005, 09:13 AM

I'm thinking of looking around for cheaper auto insurance, but I have a question. When you apply for a quote, do they offer you a low quote just to get you in, and then start raising your premiums after they have you? Does this happen? Is it standard practice?

Fern · #2 (**permalink**) 08-24-2005, 09:27 AM

No, never happened to me.

Have you considered linking your homeowners (if you own) with your auto to get a discount?

ken1706 · #3 (**permalink**) 08-24-2005, 10:05 AM

After I switched to progressive, the rates stayed pretty much the same. There was a 1% or 2% rise after the first and second year. It was about what would be expected based on inflation.

BAGAGT1 · #4 (**permalink**) 08-24-2005, 07:05 PM

It depends on how detailed of a quote you are looking for. For those companies that use credit as a determinant of premium, providing the company with permission to order a credit and Motor Vehicle report will provide very accurate results, if you do not provide this information, the premium can change dramatically depending on your credit and driving history.

Once you are insured with a company, your rates can go up or down, it all depends on how much competition there is in your state, as well as whether or not the company is making money in your area. Remember all insurance is regulated by the Department of Insurance in your state. It is up to the DOI to approve/reject rate increases or decreases, and generally, no insurance company can change the rates without DOI approval first (not neccesarilly true for all states buy is generally true for most).

All rates are filed with the DOI, therefore, are a matter of public record (which is how a company like Progressive can quote you other company premiums).

cercis · #5 (**permalink**) 08-24-2005, 08:08 PM

I've never had a problem with it. But do be careful insurance shopping because they pull your credit report which lowers your credit score.

darkstar · #6 (**permalink**) 08-24-2005, 08:55 PM

Quote:

Originally Posted by jevb

I'm thinking of looking around for cheaper auto insurance, but I have a question. When you apply for a quote, do they offer you a low quote just to get you in, and then start raising your premiums after they have you? Does this happen? Is it standard practice?

that is what they do to my friends... when it comes to cell phone subscription though...

start off a 3 year contract with 20$ a month for the first year, then its 50$ a month for years 2-3... what a way to lock you in!

BAGAGT1 · #7 (**permalink**) 08-24-2005, 09:06 PM

Quote:

Originally Posted by cercis

I've never had a problem with it. But do be careful insurance shopping because they pull your credit report which lowers your credit score.

Not true, because the credit inquiry is not an application for new credit, it will not lower your score.

http://www.myfico.com/CreditEducatio...es.aspx?fire=5

BAGAGT1 · #8 (**permalink**) 08-24-2005, 09:12 PM

Quote:

Originally Posted by darkstar

that is what they do to my friends... when it comes to cell phone subscription though...

start off a 3 year contract with 20$ a month for the first year, then its 50$ a month for years 2-3... what a way to lock you in!

As far as I know, I have never heard of an auto insurance company locking in a customer on a long term contract. Even your six month policy can be cancelled at any time if you find a better deal somewhere else.

marglo · #9 (**permalink**) 08-24-2005, 09:38 PM

I have not had this problem. Usually the rates go up after a year but not always. I have occasionally had them go down.

cercis · #10 (**permalink**) 08-24-2005, 09:42 PM

Quote:

Originally Posted by BAGAGT1

Not true, because the credit inquiry is not an application for new credit, it will not lower your score.

http://www.myfico.com/CreditEducatio...es.aspx?fire=5

Well that's good to know. We were told by a lender that looking for better rates on insurance, loans and anything else that would trigger a credit inquiry will lower your score. Maybe they were just trying to keep us from shopping around.

jevb · #11 (**permalink**) 08-25-2005, 04:51 AM

Quote:

Originally Posted by BAGAGT1

It depends on how detailed of a quote you are looking for. For those companies that use credit as a determinant of premium, providing the company with permission to order a credit and Motor Vehicle report will provide very accurate results, if you do not provide this information, the premium can change dramatically depending on your credit and driving history.

Once you are insured with a company, your rates can go up or down, it all depends on how much competition there is in your state, as well as whether or not the company is making money in your area. Remember all insurance is regulated by the Department of Insurance in your state. It is up to the DOI to approve/reject rate increases or decreases, and generally, no insurance company can change the rates without DOI approval first (not neccesarilly true for all states buy is generally true for most).

All rates are filed with the DOI, therefore, are a matter of public record (which is how a company like Progressive can quote you other company premiums).

Thanks for this insightful post. I've been with GEICO for 25 years and have never found anyone cheaper. However, the other day I got an offer in the mail from AIG (American International Companies), saying they could beat GEICO by $399. I was just wondering if they are giving me a lowball offer just to sucker me in, and then later on raise the rates back up to where they really want them. I really do hate to leave GEICO, it'a a loyalty thing I guess. But, I've never found anyone cheaper either. I think I'll go ahead and send in the paperwork and see what they do quote me for real.

terry1156 · #12 (**permalink**) 08-25-2005, 05:39 AM

The auto insurance business is pretty competitve and most want to keep customers that have good records, so I don't think they would raise rates on you. If they come back with a better offer, go to your GEICO agent and explain that you don't want to leave, but for $399 you aren't willing to stay. They may not match it, but I bet they offer to lower your rates, especially with a competing offer in hand.

jevb · #13 (**permalink**) 08-25-2005, 07:50 PM

Quote:

Originally Posted by terry1156

The auto insurance business is pretty competitve and most want to keep customers that have good records, so I don't think they would raise rates on you. If they come back with a better offer, go to your GEICO agent and explain that you don't want to leave, but for $399 you aren't willing to stay. They may not match it, but I bet they offer to lower your rates, especially with a competing offer in hand.

Good idea, I'll keep that in mind.

Thanks!