Insurance companies are competing for your business more than ever, advertising around the clock in an attempt to gain more of the market share. It’s easy to fall for some of the benefits they promote, assuming they are better or perhaps only available from a particular insurer. In this post, we will explore some of these advertised insurance features and just how beneficial or unique they may or may not be.
New Car Replacement
If you buy a new car, you want to protect your investment. Collision and comprehensive coverage are a good start, protecting your vehicle against a wide range of damages. However, New Car Replacement takes coverage a step further, ensuring you receive enough money to replace your vehicle if you total it. Liberty Mutual is a primary advertiser of this service, with New Car Replacement available for vehicles that are less than one year old and have fewer than 15,000 miles on them.
Other insurers offer similar coverage, although the details vary by company. Some offer extended replacement for up to three to five years, such as with Travelers Insurance. Others feature car replacement for used cars as well, although the vehicles are typically replaced with one of the same year, make, and model, or perhaps one year newer.
Ultimately, New Car Replacement can provide significant savings if you drive a new car, but the coverage does come at a price. Talk with an independent agent here at Tagge Insurance if you are interested in adding this type of protection to your policy.
Bundle and Save
Saving is easy when you purchase multiple lines of coverage from the same insurance company. Progressive is famous for its Bundle-and-Save commercials, but the truth is nearly any insurance company will offer discounts if you offer them more of your business. In many cases, savings discounts are offered to policy-holders who combine auto with home or renter’s insurance, but you may also be able to get extra discounts for other types of coverage, such as motorcycle or RV insurance.
Safe Driving Bonus Check
The Safe Driving Bonus Check is featured on many Allstate commercials where drivers are elated to receive a check every six months they remain accident-free. However, the bonus check is only available to qualified drivers who pay an additional fee to enroll in the Your Choice Auto Program, which typically requires good credit and an A+ driving history. If you qualify and enroll, you can receive up to five percent of your premium back at the end of each policy-period. In other words, a $500 policy would yield a maximum of $25 – enough for a couple of movie tickets at best.
Alternatively, we here at Tagge Insurance help our customers compare safe driving benefits and discounts from several different companies – some of which do not charge or require special enrollment to obtain the savings. In many cases, drivers can qualify for upfront discounts on premiums. Some insurers even offer unique features, such as diminishing premiums or deductibles.
We’ll leave off in part one of our post with the Discount Double-Check, made famous by State Farm Insurance. This feature is more of an advertising strategy than anything, promising that agents will do something we feel all agents should be doing anyway – double-checking for discounts. After all, shouldn’t your agent be working hard to find you all of the savings you deserve?
With State Farm and other companies, captive agents can only comb through policies to search for discounts from State Farm. With an independent agent, on the other hand, it is possible to double-check for savings from multiple insurers, which could reveal greater savings.
You shouldn’t be punished for a first-time accident – especially if you have a history of safe driving. Unfortunately, insurers often raise rates for accidents and claims, regardless of how pristine your history has been. Allstate currently advertises Accident Forgiveness, which promises not to penalize drivers for a first-time accident. The benefit typically comes at an extra cost and may have other requirements for eligibility.
If you prefer the assurance of knowing your rates will not climb just because of an accident, we recommend talking with an independent agent here at Tagge Insurance to explore your options. Several insurance companies besides Allstate offer similar coverage, and one – Integrity Insurance – even offers the coverage at no additional charge for eligible customers who have been policy-holders for at least five years or more.
Name Your Price Tool
The Name Your Price Tool has been heavily promoted by Progressive in the past, promising to help drivers get more control of the price they pay for insurance. We will not spend much time on this tool, as we feel it has the potential to do much more harm than good. In short, Progressive may suggest a particular level of coverage and premium, and drivers can ‘adjust’ that premium by making changes to the policy, which usually results in less coverage.
Tampering with coverage puts you at risk of being under-insured in an accident or other loss, which could cost you tens or even hundreds of thousands of dollars. It’s not worth your financial security to save a few bucks on upfront costs. Instead, always work with an independent agent who can assess your individual risks and find a competitive rate for the coverage you really need.
If you total a car you still owe money on, you might be disappointed to know that the insurance company will only pay for the depreciated value of your vehicle – not the balance that is owed on your loan. If your insurance settlement is worth less than what you owe, GAP insurance can cover the rest of the bill, allowing you to start over debt-free.
You have choices when it comes to GAP insurance. Though this coverage is not often advertised in commercials, it is still very popular among new-car buyers who finance their vehicles. The first place you may be offered GAP protection is from your lender or the dealership where you purchase your car. It’s easy to accept the coverage on the spot, simply adding the premium (usually about $400) to the balance of your loan. What you are really doing, however, is insuring yourself for the duration of your loan, when you only need it for the first few years when the balance exceeds the value of your vehicle.
Instead of accepting GAP insurance from a dealer or lender, talk with an agent here at Tagge Insurance about adding this important protection to your policy. By purchasing from a traditional insurer, you only pay for the coverage for the length of time you need it and drop it once it’s no longer necessary.
Finally, we complete our list with an important coverage that nearly all drivers can benefit from – Roadside Assistance. This coverage is designed to help you when you have a dead battery, lock yourself out of your car, or perhaps run out of gas. You can extend it for all drivers on your policy, including young drivers who you wish to protect against these types of situations. Liberty Mutual often advertises its optional Roadside Assistance coverage, but you can add this protection to almost any insurance policy, regardless of the insurer.
If nothing else, we hope this two-part post has helped shine a light on the truth behind advertised insurance features and how widely available they may be. Next time you see an insurance commercial or ad, remember that your independent agent at Tagge Insurance can probably find the same or similar coverage for you, and perhaps at a better value.