Wednesday, July 17, 2013

Insurance checkup

Every so often, an article like this one shows up on one of the sites I read, talking about supposedly painless ways to trim the fat from your budget. Typically, most of the advice in them is about stuff I already do, like dining out less often or unplugging electronic devices that aren't in use. But invariably, somewhere on the list, there's a tip about checking your home and auto insurance rates to see if you could get a better deal. And invariably, I feel guilty, because this is a job I know I should do at least every couple of years, and I always put it off. I have this tendency to assume that if the company we're using now is the one that offered the best rate when we got the policy, then it must still have the best rates now—even though I know that can change over time.

So this week, seeing that our auto insurance was up for renewal soon, I decided I really should go ahead and get a few more quotes to make sure the company we're using now (Allstate) really was the best deal. Fortunately, I knew of an easy way to do this. Some of the sites from which I take online surveys, including MyPoints, occasionally send me e-mail offers—basically, spam that I get paid to read. I can get a few points or pennies by clicking on the message, and if I actually take them up on the offer, I get a larger bonus. One type of offer that comes up fairly regularly is from insurance shopping websites that will take down your information and then send it out to several insurance companies, which then respond by e-mail or phone with quotes on a new policy. I'd saved the last few e-mails of this type that I received, thinking that I really should take advantage of the offer some time, but putting it off because I didn't want to deal with the ensuing slew of e-mails and phone calls. So now that I had the time to spare, I figured it was time to bite the bullet.

I actually had two different offers for quotes on auto insurance. The first was from a site called RateKick. This proved to be more convenient to use than I'd expected because I didn't actually have to submit a phone number and get calls from individual agents. Instead, the site ran my information through the companies' online quote services and popped up a list showing each company's rate for coverage similar to what I have now. At a glance, it appeared that there was only one company on the list that could beat Allstate's price: the rate shown for Traveler's was about $70 lower for a six-month policy. However, I was skeptical about this quote, because the questions the RateKick site had asked me weren't all that detailed, and I thought the policy it was showing me might not actually be identical to what we have with Allstate. So I went to the Traveler's website and submitted my information there in more detail. To my amazement, the quote I got there was not only higher, it was nearly twice as high as what we now pay with Allstate. Well, gee, forget that.

At this point, I was feeling pretty confident that no one could beat Allstate, but I decided to go ahead and respond to the other e-mail too. (Even if I didn't find a better rate, I'd still get some points for taking the offer.) This one was from a site called NetQuote. I received four quotes through this site, two by e-mail and two by phone. One of the e-mailed ones was from Traveler's, and interestingly, it didn't match either of the quotes I'd received from them previously. It was nearly twice as high as the one I'd received from RateKick, but significantly lower than the one I'd received from the Traveler's website. To add to the confusion, one of the two phone calls I got was from an independent agent, and he said that the best price he could find for the policy I wanted was with Traveler's—and the price he quoted me was different from any of the others I'd seen. However, neither it nor any of the other quotes could match Allstate's price, so I figured it was safe to conclude that we weren't going to find a better price anywhere else.

Having reached this satisfactory conclusion, I thought I might as well check our homeowners' insurance rate as well. For this, I used yet another e-mail offer, this one from a site called InsureMyHome4Less, which worked much like NetQuote. I got two phone calls from agents, one from Farmers and one from Liberty Mutual, and neither one could come close to the rate we get from our current insurer, New Jersey Manufacturers. However, things got a little more complicated when the agents mentioned that I could get a better rate on homeowners' insurance if I switched my auto insurance to them as well. If we did this with Liberty Mutual, the rate for homeowners' insurance would still be a bit higher than the rate with NJM—but the rate for auto insurance would now be lower than Allstate's. So for the two policies together, we'd end up paying about $140 less than we're paying now. Hmmm. Was that a big enough savings to justify the hassle of switching both policies?

Brian was skeptical about this offer, reminding me that when we first bought this house, Liberty Mutual initially told us they could insure us and then recanted, saying they wouldn't write a policy on an house within 10 miles of a coast. I e-mailed the agent to inquire and he explained that the policy had been changed; the limit was now 5 miles, and since we live 7 miles away from Raritan Bay, there should be no problem. However, Brian was still hesitant about it. All the hassles we'd gone through recently with Verizon made him reluctant to switch our business away from a company that, up until now, we'd had no trouble with—especially when the savings to be gained was fairly small. If switching our business could have cut our rates in half, that would be a no-brainer, but this would only be about a 10 percent savings. He wasn't entirely comfortable with that trade-off.

There was still one more possibility to consider: perhaps we could get just as good a deal by switching our auto insurance to NJM, or our homeowners' policy to Allstate. That wouldn't require us to switch both policies, and either way we'd be giving our business to a company we already knew and trusted. Unfortunately, when I contacted NJM for an auto quote, it came back quite a bit higher than Allstate's, and when I asked Allstate about combining our policies, they said they don't offer any discount for that. The agent indicated that the company was looking into it and might start offering a discount next year, but at this point it wouldn't be possible. So perhaps the thing to do is set all these quotes aside for one more year and then see whether we can consolidate everything with Allstate. If their rates for homeowners' insurance are as competitive as they are for auto insurance, we might get a better deal than we have now without the hassle of multiple switches.

Meanwhile, a bit of advice for anyone who's considering buying any sort of policy from Traveler's: make sure you double-check the price before you sign anything. It might have changed in the past half hour.

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