What Are The Insurance Companies Leaving Out Of Their TV Ad Offers?

I am amazed at the number of TV ads that are devoted to convincing you to switch auto insurance companies to save money.  They are almost so common place that we don’t even notice them anymore.   While I think that anyone who shops long enough can always find a lower rate on their car insurance, a 2009 survey discovered that only 14 percent of people who shopped around for a better rate on their car insurance found that they could save money by switching companies.  Still, the ads continue to bombard us with new and interesting gimmicks and twists that will entice you to start shopping.  So what about these gimmicks, do they save you money or are they just marketing tricks?  I want to pull back the curtain on a few of them to give you an idea of what you are up against.

One of the newer gimmicks is the Nationwide Insurance vanishing deductible trick.  It seems like a great idea; Nationwide will reduce your deductible by $100 for each year that you don’t cause an accident or turn in a comprehensive claim like windshield, vandalism or theft of your vehicle.  Of course if you have a claim like that then your deductible will then go back up to the original level, minus a $100 sign up reduction.  No more than $500 of your deductible can ever disappear.  What the blurry fine print on the screen says is that this program will cost you $60 per year per car.  So this means that you would be paying $60 per year for $100 of protection that you will probably never need.   This is a great deal for Nationwide and not such a  good deal for you.  If you are truly a safe driver and have few claims, then I would advise that you take the highest deductible that you can afford and apply some of the savings to making sure that you have very high liability limits.

Another interesting ad is the Progressive Insurance snapshot program.  Right now, this is only available in 39 states and North Carolina is not one of them.   This program installs a big brother like device into your car’s diagnostic system and sends your driving information to the insurance company.  Now in theory, I like the idea of rewarding good drivers for their good driving habits.  But the problem with this program is that your driving habits will have to be the crème de la crème of all drivers in this program for you to see the huge discounts that they project in the ad.  Under a system like this which is voluntary, only the safest drivers will sign up and those drivers are now your competition for the discounts.  Let’s not forget the creepiness of having your insurance company checking out all of your driving habits.  It would be like me riding around in your back seat everywhere you go, making quiet notes on my clipboard and giving you disapproving looks in the rear view mirror.

Another highly advertised program is the accident forgiveness program.  Allstate insurance pushes this program but the details reveal that it may not be such a great deal for you.  First of all, you will have to pay extra to enroll in this program.  And in North Carolina, there is already a first accident forgiveness program built into the regulations.  To learn more about that, click here.   If you are generally a safe driver, then this program usually means that you end up paying for something that you will never need.  And the offered rebates for safe driving have to come from somewhere.  As you may have guessed, the insurance company will need to collect this money from you in advance in order to give it back to you later.  As evidence, Allstate recently reached an agreement with California regulators to stop selling their Your Choice program there after a lawsuit alleged that the program overcharges policyholders and that the costs for this program were deceptive.

A critical view of these programs might lead you to believe that these special programs are not designed to save you money on your car insurance, but rather to get you to call them for a quote in the first place.  I would advise that you take the time to find an independent insurance agent that you trust.  Choose one that will take the time to listen to you and discover your needs and then go out and shop the marketplace of insurance companies to find the program that is best for your unique situation right now, and in the future.  Car insurance is complicated and critical to your financial wellbeing.  You are trying to protect all of your possessions and your income stream and this should not be a do it yourself project.

Clinard Insurance Group is an independent insurance agency.   We insure more than 5000 families all across North Carolina and we want for all of our clients to be informed insurance consumers.  We will take as much time as you need to be sure that you are comfortable and have a full understanding of the insurance policies that you purchase from us.  If we can help you with your homeowners insurance, your auto insurance, your life insurance or even your business insurance, please call our office, toll free at 877-687-7557 or visit us on the web at www.ClinardInsurance.com.

First Accident Forgiveness - For North Carolina Auto Insurance This Is The Law, Not A Special Policy Feature

You hear it on the television commercials, how this company or that company will forgive your first accident and not charge you extra for it. But the fine print is hard to read and flies by your screen far too quickly. What they don’t tell you is that every North Carolina auto insurance policy offers you first accident forgiveness. What they also don’t tell you is that this rule is full of clauses that can put the charges back on your policy later. So here’s the truth about first accident forgiveness.

All North Carolina personal auto insurance policies are governed by the same policy form. Part of this policy form and its rules cover exactly when the insurance company can surcharge your policy with extra charges for past or current accidents and moving violations. One of these sections discusses what is called a non-chargeable accident.

Anytime you have an at fault accident or a moving violation, insurance points can be added to your policy. These points remain on your policy for 3 years and they generate additional charges to your policy. This of course is an attempt to raise the rates for risky drivers while keeping them as low as possible for safer drivers. When you have an accident that is your fault, there are a few exceptions that allow you to avoid the associated insurance points. This is the first accident forgiveness section and these are the rules:

If the accident is your fault and the total damages are under $1800 then it might be a non-chargeable accident. The next requirement is that the accident caused property damages only, in other words, no one was injured. Some minor bodily injury charges are allowed, such as an ambulance bill and doctor checkup but only if the result is that no one was actually hurt. The last requirement is that no drivers on the policy have a chargeable accident or ticket in the past 3 years.

Now if all of the above conditions are met, then you should receive no additional charges on your policy for that accident. But there is one additional caveat. If in the three year period following this non-chargeable accident, you or any other driver in your household has an at fault accident of any kind, or a moving violation, then the old accident becomes a chargeable accident and the points associated with that accident are now added to your policy for the remainder of their 3 year term.

So, now you have a better understanding of that fine print that flies by your screen during commercials. Just know that some companies have chosen to use a policy provision to which you are entitled and dressed it up as a special feature that they offer you. It’s a marketing gimmick and nothing more. Don’t bite on that hook for that bait.

At Clinard Insurance Group in Winston Salem, NC, we work hard to help all of our clients become informed insurance consumers. If we can help you with your auto insurance, your home insurance or your business insurance or life insurance, please call us, toll free at 877-687-7557 or visit us on line at www.ClinardInsurance.com.

The source information for this article was pulled from information which can be found at www.InsuranceAnswerGuy.com.