Millions of Americans have been impacted by Coronavirus. Most insurance companies have relief plans, and some are even giving back!
Insurance profits are slim. Very slim. So much that they are controlled by your department of insurance, so when your rates go up or down, they have to be approved by the State! Now that millions of Americans are practicing social distancing due to the shelter in place, claims are at an all-time low! Traditionally, insurance companies would offer lower rates during renewal, yet that could be six to twelve months from now!
Insurance companies like Safeco, Travelers, Allstate, Geico, and USAA have announced plans to issue 10-20% refunds to its clients for April and May.
Do not fall for the marketing terminology used by some of these insurance companies. State Farm just announced it was refunding four BILLION dollars, but that should not be a shock once you consider State Farm doubles the size of its nearest competitor, Allstate.
Let’s do some math. Let’s say you are paying $100/month per vehicle (that is a sign that you are an ideal client for that insurance company). These savings equate to a 30 dollar refund check from your insurance company.
I applaud insurance companies for thinking outside the box; I do, I just hope we can tailor the expectations of our clients to avoid disappointment when that check finally arrives.
If you have lost your job or your income has suffered due to the Coronavirus, call your agent.
All of our partnering carriers have some sort of plan to assist with those impacted by the Coronavirus. Please call our agency at 678-921-3601, so we can start the process that they have put into place!
Do not let your insurance lapse
Insurance companies use prior insurance history, payment history, previous insurance coverage, and length as part of their underwriting guidelines. Not having continuous insurance is one of the most substantial negative impacts you can have on your insurance score, easily doubling insurance rates. This is another reason why insurance companies have plans in place to assist. Most insurance companies are either delaying cancellations, but we have to put them on notice before the missed payment or lapse!
Somethings NOT to do
I have read several articles advising people to “Adjust coverage”. This is less than ideal advice. First, your insurance limits should be designed around your liability. If you are a college kid with a computer in his name, you probably don’t need 250/500 limits. Along the same lines, a family of four in a 300,000 dollar home shouldn’t have insurance limits at 25/50. Not even for a little bit.
Milage discounts- These were the HIT back in the mid 90’s and 2000’s. Yet with the expansion of people purchasing insurance online and agents attempting to be competitive, EVERYONE suddenly reported low mileage. Since the data is no longer accurate, many insurance companies to minimize or eliminate this discount.
Somethings you CAN do
Telematics- every company has a different name for them. Insurance companies are investing in apps that track driving behaviors. For those who play nice, they can get anywhere between a 5%-40% discount! Click the image below to watch a video!
Let’s take Safeco, for example, one of our preferred insurance carriers. Clients can opt-in at any time, does not have to be a renewal or new business. Clients download the app and allow Safeco to track driving behaviors for 90 days.
- speeds over 80 miles per hour
- regular hard braking
- frequent accelerations
- number of miles driven
Doing so gives our clients an immediate 10% discount. If your driving behavior is less than ideal, you will still get 5% FOR THE LIFE OF THE POLICY. Safeco will also not increase your rates or drop you for pulling a Ricky Bobby, either.
Comprehensive and Collision
Call your agent and discuss the implications of removing comprehensive or collision off a vehicle. Removing coverage can save several hundred dollars a year, yet it places the value of the car back on the insured.
I suggest considering removing comprehensive or collision if the vehicle is ten years or older. Many clients call in on the day they pay off their car to remove coverage, but if the car is still worth 30,000 dollars, it could very well be worth insuring!
What if your insurance provider isn’t helping? It’s time to shop.
I know this sounds obvious, but I can’t tell you how often people call and mention that they should have done this YEARS ago, but it always gets pushed back.
I know shopping for insurance isn’t on the top 10 things you planned on doing today, but 80% of people who call either save money or receive more coverage. The general rule of thumb is that your auto premiums should be between $75-$150/month with a clean record, and your home can range from $500-$2000 depending on the size of the house!