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Review Your Insurance Policies Annually

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Insurance SucksI hate insurance.

Actually, I take that back, I don’t hate insurance. I hate paying for insurance.

Every time I get an email from GEICO or a mailing from Traveler’s, I think about how I pay them every six months and, in the nearly ten years of driving and four years of living in this house, I’ve never filed a claim. At least with medical and dental, I get some regular checkups and routine cleanings (I hate getting a teeth cleaning but I love getting stuff for “free”). Don’t get me wrong, I’d still get insurance even if I wasn’t required to by law, but that doesn’t mean I enjoy paying for it!

So, once a year or so, I have an insurance review day. I get a little antsy and start asking for quotes from other insurance companies to see if I’m getting the best price. (Well, I’ve been more in the “or so” category, I haven’t done this in two years)

Auto Insurance

First, the baseline: We pay GEICO $462.30 every six months to cover my 2003 Toyota Celica and my wife’s 2005 Honda Civic. I have no comprehensive or collision insurance and she has $1,000 deductible coverages on both. Other than that, we have pretty standard coverages otherwise as required by Maryland law (100/300 Bodily Injury Liability, $100k Property Damage Liability, uninsured motorist, etc.). It’s pretty tough to beat that price because we also have a long time policy holder discount and a discount for being a member of an affiliated organization.

Candidate One: Allstate Insurance: I fire up the browser and point it to Allstate Insurance. One thing I don’t like about Allstate is that they have five different “packages” with a variety of add-ons like accident forgiveness and deductible refund. I really just wanted to know the basic stuff, so I selected the standard package. After entering a slew of information, the estimated 6-month premium was $548.48, or $86.18 more than my current coverage. Boo!

Candidate Two: Kanetix Insurance Search: I totally forget about Kanetix, some insurance search website I used back in the day when i was playing around with driver characteristics to see their affect on auto premiums.

Sadly, there was only one instant quote, a firm called Amica that was a whopping $123.83 a month, or $742.98 (a far cry from $462.30). A few more email quotes came trickling in like Unitrin Direct at $698 and Erie Insurance at $1,092 (with multi-policy discount) but nothing came within spitting distance.

Candidate Three: State Farm: I kind of fell into this quote after quoting homeowners insurance with them through NetQuote system. The agent, Debrorah, and I talked about a whole bunch of things but the end result was that State Farm would charge me $439.36 every six months, a savings of $22.94. Part of the reason for the lower price was because it would include a multi-plan discount because I would get homeowners insurance through them.

Normally, twenty bucks alone wouldn’t be enough to entice me because there’s a bit of hassle in changing your insurance. However, as you’ll see in a minute, the discount on homeowners with them would provide the real icing on the cake.

Homeowner’s Insurance

Right now we have our insurance through Traveler’s, which is the insurance company affiliate with GEICO, but they don’t offer any multi-policy discounts, which is a real bummer. We have $246k coverage on our dwelling, $24k on other structures, and some other items like $300k of personal liability coverage too, which is all pretty much standard. Our annual premium is $797.

The NetQuote system was a lot like LendingTree, they collect your information and they try to match you with insurance agents. Once I completed the application, I was immediately matched with an agent from State Farm Insurance Company and one from Allstate Insurance Company. My chat with the State Farm agent, Deborah, was great, we went through all sorts of information and arrived at a price of $610 a year for homeowner’s insurance – a discount of $187.

I got a deluge of phone calls from a variety of insurers. I talked to all of them, gave them all the information they needed to get me a quote and many came close but State Farm won out in the end. What was funny was that it took around two months between when I submitted my information to when I actually changed my policies over because of some career decisions we had to make, but the price of our quotes never changed (and only a couple of agents were persistent enough to continue).

See The Savings!

In the end, by changing over my policies, which in effect consolidated them into one account, we were able to save $220 a year. $40 in auto insurance premiums and $180 in homeowner’s insurance premiums, all for a total of a couple hour’s of work! Not bad.

If you haven’t shopped around for insurance in the last two or three years, I highly recommend it because you could be saving big money.

(Photo: bookgrl)

{ 25 comments, please add your thoughts now! }

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25 Responses to “Review Your Insurance Policies Annually”

  1. M says:

    Does anyone know how to find information about how good an insurance company is when you need it? One of my friends is a personal injury lawyer and says Allstate is in trouble with several states because they try to lowball their payouts, and she recommended I avoid them for car insurance. (My understanding, I am not a lawyer and do not speak legalize). Is there a way us average folks can look up that information?

  2. Eric says:

    Good job Jim although I’m wondering how you drive a Celica…the thing is tiny for me to sit in. :(

  3. Since it is a pain to switch insurance, did you try calling your current insurance company and asking them to beat the quote from State Farm?

    Often times they would rather keep a customer, and it saves you the trouble of switching insurance.

    Paul

    • Jim says:

      The problem is that Geico wouldn’t give me a multi-line discount, which was the big difference. Geico probably would’ve matched on the auto but Traveler’s, which works with Geico, wasn’t going to shave off $180 on my premiums to keep me.

  4. MLR says:

    I find changing over insurance so annoying that I HOPE I can’t find a cheaper rate when I go looking.

    That will mean I haven’t been overpaying AND save a headache :)

  5. Scared to switch says:

    Hi Jim,

    Just curious if you or any other readers know what to do in this situation… several years ago there was a very minor accident. But there was a lawsuit against multiple parties involved and prior medical conditions, etc.

    This lawsuit is being handled by the Auto insurance companies local law firm they deal with and the question we’ve had is:

    Are we stuck until this lawsuit is resolved? If we switch to another insurance company are we then liable for handling the issue w/o the insurance companies law firm?

    -Scared To Switch

    • Jim says:

      In theory they’re supposed to still cover you because they were your insurance company at the time of the incident, but I’d call them and ask because asking can’t hurt.

  6. Darren says:

    Jim,

    Do you live in California or Oregon? If so, you should definitely check out Wawanesa Insurance. I have their auto insurance and they beat everyone I could get a quote from. Also, you get a year-long policy which is nice since I don’t have to think about it for a whole year.

    Anyway, a quick tip for anyone in CA or OR to check and see if Wawanesa can beat your current rates. I know they offer homeowners as well, but not sure how competitive they are on that.

    • Ditto w/ Darren on Wawanesa Insurance. I’ve personally can’t find anyone else that can beat their rate. Though I haven’t have to actively use their service yet (beyond calls/inquiries), so the judgment is still in the air on how well they handle claims (knock-on-wood though for needing to file a claim).

      Jim’s located in Maryland, but like most East Coast people, he wish he lives in California! Hah. Kidding.

  7. chandra says:

    To M, the first person to leave a question,
    I am a massage therapist and allstate does lowball my bill submissions for PIP auto claims. State Farm has never been bad with payment….

  8. Paige says:

    We use State Farm. They continually have the best multi-policy rates for us. I check around every couple of years. We have had to file a claim on our house before and they handled it extremely fast. I was very pleased.

  9. I’m impressed with your patience to do this with agents involved, etc. We’ve been very pleased with our insurer for a number of years and they handled a claim on a house fire relatively well (total loss, so it’s not tough to figure the claim out).

    In addition to property and casualty insurance, I was pleasantly surprised when we shopped for an individual health insurance policy last Fall. My wife’s employer has consistently decreased their contribution and increased premiums have been paid out of our pockets. As a result, I went shopping and found policies from the same insurer in our area for less premium and less total out of pocket max while keeping the same coverage. We weren’t ready to make the switch last year because I shopped too late, but we know when enrollment time comes around this year, we’ll have a new policy waiting for us.

  10. Luke says:

    I’m a bit confused. Did you go with AllState or State Farm? In the Automobile Insurance area you stated that you talked with Deborah from State Farm and then in the Homeowner’s area you talked to Deborah again, but this time from AllState.

    Anyway, I have been with State Farm for about 20 years and have been happy with their service, though I have checked out other insurers as well.

    The performance of the insurer if you have a claim is one of the most important aspects to look at. I tend to only look at the insurers that are highly rated by JD Power in all areas. I have found State Farm to be near the top and the best value.

    Also, State Farm allows me to pay my auto, umbrella, disability and life policies by credit card – saving me an extra 2%.

    Lastly, the extra icing will be if State Farm ever goes public. If they ever do, I’ll get a nice bit of stock!

    • Jim says:

      Whoops, I went with State Farm, it was a typo on my part. The names both have “State” in them so I got mixed up!

      • Luke says:

        Your last paragraph of Homeowner’s Insurance will need to be changed to “State Farm won out in the end”.

  11. Scott says:

    Insurance companies and salespeople baffle me. We went shopping for home insurance for our first home purchase last month and got two very different quotes from two State Farm agents that work with 5 miles of each other. From what I can tell, many insurance salespeople tack on some extra dollars to pad their wallet wherever they can. Can’t blame them, but it doesn’t make me want to be their customer.

    Best advice I think it to continually call your agent and shop around to keep them honest. It’s amazing how each time I call my insurance companies they offer me a lower rate – sometimes without even asking!

  12. Stacey says:

    I’ve got to agree with Luke… once you go through a claims process, you’ll know the true worth of your policy. We’re paying about $100 more per year for our current provider – but they’re local, and they gave us excellent service when I was in an accident (other driver’s fault) a few years back. I can also stop in the office any time with questions, and they answer the phone by the third ring. It’s well worth the $10 per month. :-)

    The other driver in that accident, on the other hand… I heard she had some serious problems dealing with her non-local insurer. Just be sure you know what you’re getting into when you purchase a new policy. Do they have a local office? How will they represent you if a claim goes to court? Ect. Try to find others who have dealt with the company before you commit.

    Best of luck, Jim!

  13. Deby says:

    I’ve been using State Farm for years, first with a renter’s policy, added my Mom’s car insurance when she lived with me for a few years, then I switched my car and added homeowners’s insurance when I bought my house. Not only are the rates competitive, but the service is great. We had a lot of involvment with them recently with several changes we made to our policies, and they’ve been very patient and helpful. The agent even found that a discount we are been entitled to had somehow dropped off, and added it back on and gave us a refund, all without us even noticing it was gone.

  14. debbie hunt says:

    you scoffed at AMICA but it is a very large insurance firm, primarily in New England. We have had them for 30 years and we can’t say enough good things about them. In the few instances we have had an accident, they have been over backwards to rescue us immediately. They are rated very high for both pricing and consumer satisfaction by Consumer Reports. Sorry, you have had one bad quote, but they are tops in the business!
    deb

  15. aua868s says:

    i have my auto and renters insurance with the same company…i get nice discount.

  16. Mark:

    I’m not sure where this comment fits into the insurance discussion, but zero cost collars are expensive in the open market and rarely do they result in a net zero unless structured through private contracts. I would advise anyone pursuing this strategy to be wary of the tax implications, pricing structure, and real short and long-term risks associated with them. In addition, if you construct a collar incorrectly and ignore the 20% minimum band, you will be guilty of a constructive sale meaning any gains would immediately be taxed. This can further be complicated with wash sale rules. If you’re playing the collar game, I hope you’ve done your homework.

  17. saladdin says:

    I run from anyone selling me insurance who uses teh word “guarantee.”

    saladdin

  18. CK says:

    Jimbo delete this bull*&%^.

  19. Jim says:

    Surprised it missed the filters… it’s gone now.


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