How Strong is Your Auto Insurance Company Financially

When you are shopping around for auto insurance quotes, one important thing to keep in mind is the financial strength of your auto insurance company. How would you like to pay your premiums diligently, like a good auto insurance customer, then get in an accident only to find out that your company wasn't in a financial position to pay you what you're owed? This is especially important in the case of natural disasters, which can cause a tremendous amount of damage, and result in a lot of claims at the same time. If your auto insurance company isn't in good financial health, they may not be able to bear this additional strain. Therefore, it's best to check out the auto insurance carriers financial health before you buy.

So, how do you do this? Well, there are two easy to find resources at your disposal:

1. A.M. Best is a company that publishes insurance companies financial strength ratings. The purpose of these ratings it to let the consumer know the insurance companies ability to actually pay a claim. A.M. Best's ratings range from A++, which is the best, to D. Ratings of E indicate regulatory action, F indicate that the company is in liquidation, and S means the company is suspended. Only choose companies with B+ ratings and above.
2. Another company that provides ratings on insurance companies financial health is Standard & Poor's. Their ratings go from a top rating of AAA down to the bottom which is CC. A rating of R indicates that the company is under regulatory supervision, and NR means that the company is not rated. You should only look at companies with a BBB rating or above.

You may be able to find this information on companies websites. If they are in good financial shape you would think they would want to advertise it. If not, you can also search at the A.M. Best or the Standard & Poor's website.

As always, do your homework and shop around for auto insurance quotes before you buy. Be sure to check out the companies financial strength, and remember that this rating has nothing to do with customer service, simply the companies financial strength.

Read Your Auto Insurance Contract and Look For These Clauses BEFORE You Sign

Alright, let's say you've followed our advice and shopped around for auto insurance quotes. You've got the lowest auto insurance quote in front of you and you're ready to sign. BUT WAIT. There are two clauses that you must look for in your auto insurance contract.

1. Your right to sue - Some companies will throw a clause into the agreement where you will be forced into arbitration in the case of a disagreement, instead of being able to take the case to court. If at all possible you don't want to give up this right. Doing so will make it easier for the insurance company to take advantage of you. Since contracts are mutual agreements, it may be possible to cross out this part of the contract. If the insurance company will not agree to this, it may be best to start looking elsewhere.
2. Aftermarket parts requirements - if you see statements such as "new factory", "like kind and quality", or "aftermarket parts" in the contract regarding the parts the repair shop will be able to use in the event of an accident, move on to the next auto insurance company. Aftermarket parts aren't well regulated at this point, and are considered by many to be substantially inferior to the factory parts. It is much easier to just research auto insurance companies that will provide factory parts, then to haggle with a company over the parts to be used after there is an accident.

After you shop around for auto insurance quotes, make sure that you follow through and read the contracts. Yes, I know it is boring, but the time you spend in the beginning will save you a lot of time and frustration later on. Happy shopping!

Save up to 50% on your Auto Insurance: Get Rid of Collision and/or Comprehensive Coverage on Older Cars

Comprehensive and collision coverage will cover the replacement of your vehicle in the case of theft, vandalism, or natural disaster, or in the case of a collision, respectively. This is terrific, but what if your car is only worth $5,000. Generally the cost of comprehensive and collision coverage is somewhere around 40%-50% of your entire policy. You could be in a situation where you are paying more in insurance than your car is worth.

So how do you figure out if you are paying too much. Add up your comprehensive and collision coverage premiums and multiply them by 10. If that number is more than the current Kelly Blue Book value of your car then don't buy the coverage. "But what if I get in an accident?" you say. Let's look at the statistics. In general the average policyholder only makes a claim once every 11 years. As for total losses, the average policyholder reports one every 50 years. Odds are on your side, so don't pay more than you need to.

It is a good idea to review your auto insurance policy often. Be sure to do your homework and get auto insurance quotes from the major companies. Getting auto insurance quotes, increasing your deductibles, not getting over insured, and taking advantage of discounts will help you lower your auto insurance premiums significantly.

Get Auto Insurance Quotes BEFORE You Buy Your Vehicle

One sure-fire way to pay less for your auto insurance is to do your research and get auto insurance quotes before you purchase your new vehicle. Auto insurance rates can be significantly different depending on the car you drive.

The year, make, and model of your vehicle are all factored in when your insurer determines what your auto insurance premium will be. Why you ask? Let's take a look at it from the insurance companies perspective. Insurance companies are in the business of risk and probability. Basically, the more of a risk you are driving down the road, the higher your auto insurance premium will be. Right now we are only talking about how your car factors into the risk equation, but obviously human factors like your age, location, driving record, etc. all play a part in determining your auto insurance premium.

Age of your car

By looking at the age of your car, an insurance company can determine the risk that your car will break down, or otherwise fail, causing an accident. The older the car, the more likely it is to fail. On the other hand, older cars are also worth considerably less than new cars. So, comparatively, an older car will cost less to insure than a newer car, despite the fact that there is more risk of a breakdown, simply because the replacement cost is less. However, if you are comparing two cars of similar ages, you may find a significant difference in auto insurance quotes, depending on the track record of the make and model, safety features, style of car, etc.

Make and model

Auto insurance companies have compiled data on the safety of every make and model of car. They take into factors such as safety recalls, safety features, driver behavior, risk of failure, and come up with an overall risk assessment for the vehicle. Basically, the make and model with the better track record as far as risk is concerned, will cost less to insure. Thus, when you are comparing cars, get auto insurance quotes on each as they may be significantly different, even if they are the same age, and a similar value.

Safety features

Safety features such as antilock breaks, automatic seatbelts, and airbags all help your car achieve a higher safety rating and thus the car poses less of a risk, specifically to bodily injury. This means in case of an accident, the auto insurance company will likely have to pay less in medical bills. Thus, you should look for cars with more safety features, and be sure to include this information when getting auto insurance quotes.

Style of car

The style of car makes a big difference in auto insurance rates. A Porsche owner will pay a lot more than a Camry owner. Of course replacement cost is a factor here, but also consider driving habits. A Porsche owner is more likely to go faster and utilize the features the car was built for, namely speed, agility and handling, whereas the Camry owner is probably using their car in a more utilitarian way, to get from point A to point B. The moral of the story here is your auto insurance premium will be lower if you stick to more "practical" cars.

Replacement value

This is an easy one. The higher the replacement value, the Kelly Blue Book value of your car, the higher your auto insurance premiums will be. Consider purchasing a used car with a good track record and safety features, and you will pay considerably less than buying a new one.

Remember, it is important to get auto insurance quotes before you purchase your car. Doing so could help you to choose a car that will save you a lot of money in the long run. When getting auto insurance quotes, be sure to include the safety information of your car and ask about any discounts.

Accident Auto Insurance: Get Auto Insurance Quotes and save money!

In almost every article on this site we mention the importance of shopping around for auto insurance quotes. The auto insurance industry is highly competitive, with all the major companies like Geico, Progressive, Allstate, Nationwide etc. working very hard to get your business. What should this mean for you... LOWER RATES. You could potentially save 50% or more on your auto insurance through lower rates, special incentive programs, and discounts, simply by getting auto insurance quotes. The entire process might take an hour or so of your time, but believe me you will be well paid for that hour of your time.

When getting auto insurance quotes remember to tell your insurance agent if you fall into any of the following categories:

You are employed in a low-risk occupation

You belong to a professional organization

You have multiple policies (homeowners insurance or renters insurance with the same auto insurance company) or multiple cars on the same auto insurance policy.

Your car has safety features such as antilock brakes, automatic seatbelts, and airbags

You are willing to assume more risk as a driver

You are a senior citizen

Start with your current insurance company and make sure they are giving you the lowest auto insurance rate possible. It may only take you a few minutes and you could save 50% or more every month. Over the course of a year this could add up to A LOT, so stop reading and make the call or get auto insurance quotes online.