Auto Insurance Can Be Cheap
You may be wondering if direct auto insurance right for you. Perhaps you’re trying to cut costs these days and are evaluating your expenses for areas where you can trim your outgo and maximize your income. If that’s the case, then shopping for better auto insurance deals is a wise move.
In direct auto insurance or home insurance, you deal directly with the insurance company without the buffer of an insurance agent. These types of firms have been popping up on the Internet over the past half decade. They offer discount rates and primarily an online presence. 1-800 numbers are provided, and some have actual bricks and mortar locations. Direct General Insurance, for example, has 480 locations over 12 southeastern states in the US.
The majority of direct auto insurance firms operate only in states or areas where no-fault auto insurance is mandatory. In circumstances where fault determination is taken out of the settlement equation, firms can calculate their rates with much higher statistical certainty. The downside is that safe drivers must go to civil court to recover monies lost to higher insurance rates due to claim-filing for damages that were not the fault of the policyholder.
Which party pays the cost for damages and losses incurred in a traffic accident is determined by a finding of fault provinces and states without no-fault legislation. As of spring, 2009, there are twelve states in the US with some form of no fault auto insurance; Massachusetts, Minnesota, Utah, California, Kentucky, Pennsylvania, North Dakota, New Jersey, Hawaii, Florida, Kansas, New York, and Michigan.
The purpose of going no-fault is to reduce wait times for accident victims. The only kink in the pipeline is at the insurance appraiser stage. No-fault states typically avoid creating a bottleneck in the claims settlement pipeline at the appraiser by instituting state-run or licensed collision centers. For these reasons, insurance companies are willing to run in no fault states exclusively and offer no agents but provide attractive discount rates.
But for consumers, the real weakness in the direct insurance business model is the position it puts the consumer in when at his/her most vulnerable. The human body is not a machine and evaluations of what it will take to recover from injury are not always reliable, primarily because full recovery, while always the goal, is not always possible. These types of claims are where a good agent is worth their weight in gold. The agent stays up to speed on your condition and navigates you through the claims process.
Caution and thinking things out thoroughly must be advised when making the decision to forego the insurance agent in favor of the discounts direct auto insurance companies offer. But if you’re willing to handle some of your own paperwork, then dealing with a direct insurer may be the way to go. Keep in mind that as the industry evolves, the more consumer friendly companies will be the ones to outlast even the best insurance agency in the neighborhood.
Buying car insurance direct isn’t going to be as cheap as getting it at a thanksgiving sale but you will be able to get a great price. When you go looking for a way to spend the money you save you will wait for the Cyber Monday Sales
