Confessions of an Auto Insurance Agent

January 29th, 2010 by john

BuWiz.CoM:

Many of us know the feeling of getting our car insurance bill and thinking, “Again!? Didn’t I just pay this!?” Car insurance is one of those unavoidable (in most states) expenses. AOL Autos wanted to find out from an insider exactly what goes into those prices and what we can do to keep our car insurance costs down. We talked to Patrick Lawson, a 25-year veteran auto insurance agent.The Bottom Line: Premiums
Have you ever wondered how they come up with these numbers? Lawson mentioned the common factors like age, sex, car type and driving record but also noted a new, little known factor. “Companies are now, of all things, checking credit because people with poor credit, statistically, can be susceptible to more claims,” he said. He explained that some people in these cases are more apt to file a claim instead of settling it themselves because they might not have the means to handle it any other way.”Insurance is nothing but numbers, and that’s all the industry has to go on is how they make these number come out. And the numbers suggest that people with less-than-perfect credit, sometimes, have a higher probability of claims,” says Lawson.

Content Continues Below

Regardless of good credit or bad credit, he always recommends that people shop around for car insurance, “Even if you have pristine credit, some companies put more of a value on credit than others,” he said. “You can’t make a blanket statement, but what you can say is it pays for everybody to shop around a little bit because it’s well worth it.”He said that some car insurance companies have bad experiences with drivers and some have more positive experiences so, “You as a consumer, have the job to find the ones that are having the good experiences.”Once you find a car insurance company that provides the services you’re looking for, keep in mind that the prices themselves are fixed by the insurance company, so haggling with your agent is out of the question. “Whatever the price is, it is,” he said.Some Things to Avoid
Many of us have let someone else borrow our car for a short time. Maybe we’re hurt and can’t drive, a friend needs a car for the day, or we simply just don’t feel like driving. Lawson told AOL Autos that lending your car to the wrong person can be a big mistake.”You should always be careful who you let drive your vehicle. You just don’t arbitrarily say, ‘Hey take the keys and go’ because you don’t know what that person is doing, you don’t know their driving record, you may not even know if they have a license,” says Lawson.