MYTH #1-  Agent’s Control Rates

Why are quotes from the same company different from different agents?  There is no one answer to this, however understanding the insurance market and pricing will give you an edge as an informed consumer. Most important to be aware of is home and auto rates in TX are filed with the State of TX by standard companies. Premiums that are different from the same company would most likely be because of a difference in coverage, adding or removing discounts,  or policy fees being added.

Below are some common differences that can affect rates:

1. DISCOUNTS YOU MAY NOT BE AWARE OF:

              a. AFFILIATE GROUP DISCOUNT– There are affiliate group programs that some companies have which may qualify you for a rate that the general public does not qualify for. EXAMPLE: You work for a fortune 500 company and they have a group program set up with company x and therefore you get a discounted rate through that program. With “off the rack” retail rates, differences in premium are most likely going to be explained by finding differences in coverage’s, discounts, policy that is being quoted, or claims that are being factored.

             b. LOW MILEAGE DISCOUNTS– Some companies offer discounts on vehicles that are driven less than 8k miles per year, be sure to mention this if it applies to you.

             c. PAID IN FULL DISCOUNTS FOR AUTO INSURANCE– Some companies will offer fairly substantial discounts if you r are able to pay in full for your auto insurance.

             d. NEW ROOF DISCOUNTS ON HOME- This can be a substantial discount with some companies, if you have recently replaced your roof, be sure to tell your agent

             e. COMPLETE HOME REWIRING DISCOUNT- If you have recently rewired your entire house, some companies will give you a discount for this as well

2.      COVERAGE’S BEING INCLUDED (OR NOT INCLUDED)- Agent’s have varying levels of understanding of policy coverage’s and various levels of general practice for applying coverage’s to quotes.   EXAMPLE:  Agent A has a general practice of never quoting foundation coverage unless asked, even though it’s available with company X.  Agent B always quotes with foundation coverage, resulting in a slightly higher premium with Agent B, but better coverage.

So how do you know what to look for?  We suggest looking for experienced, knowledgeable agents that have professional insurance designations.  This will greatly improve your chances of finding a good agent that will help you navigate through what is available in the market place and how to make sense of it all.

 3.   POLICY FEES-  Another way rates can be different is if a policy fee is applied. Policy fees must be disclosed on the quote, and/or application.  There are many shops that charge additional fees to do business with them.  You can easily determine this by looking at the quote and application for disclosure of fees.

 

So MYTH #1, busted.  Agents don’t control the rates for home and auto insurance in TX, when it comes to rating we have very little control.  If you receive quotes from the same company and the premiums are different, look closely at the coverage’s on the quote, the discounts applied, and policy fees. 9 out of 10 times, this is where the difference lies.

 

WHAT DOES ALL THIS MEAN FOR ME?

Companies setting rates can be a good thing for you as the consumer, this really means it’s more important to find a good agent you trust because he or she will do their best to quote the broadest, most applicable coverage’s, apply all the available discounts, and help you understand everything from claims, to billing, to coverage’s.  The consumers that understand this, get the most for their insurance dollar.

What else would you like to know?  Submit questions to steve@stevewhiteinsurance.com