Buyer Beware: Auto Insurance Scam Tactics

Posted on Jan 7th, 03:37 pm, under Auto Insurance 101

All drivers are required by law to purchase car insurance. This means car owners set aside millions of dollars every year for regular insurance payments. With that kind money going around, it also means that the industry is rife with insurance scams and fraudsters. This is why it pays to be familiar with the common tactics that scam artists use before buying auto insurance.

1. Fake insurance policies

You don't need to look hard to find frauds. Insurance scammers place advertisements for cheap car insurance online and in papers, and many go so far as to rent offices in order to appear as reputable and real as possible. Invariably, someone takes the bait and pays for a fake policy and insurance card. Usually, victims only find out that their supposedly "legitimate" auto insurance is a fake at the worst of times: during an accident, when they're pulled over by police, or when they register their vehicle. This puts them into even deeper legal and financial trouble.

One thing to watch out for when buying coverage: see if the agent issues insurance on his or her own. Technically, they're not supposed to be able to do that, because as "agents" they only represent the insurance company, and thus they don't have the authority to give you a policy then and there. 

2. Novelty and fake insurance cards

It doesn't matter whether you're carrying a fake insurance card either unknowingly or on purpose, you're just as liable either way. Using a fake insurance number carries a risk of felony, entails huge payments in the event of accidents or injury, and raises insurance costs for honest drivers. 

3. Lowballing

While hunting around for the best insurance deal possible, you see that one company offers a rate that's much lower than anything else on the market. Then, once you've signed up and paid them, they tell you that there was a "company rate error" and that your real premium is so many dollars higher than the original price you were given. 

Avoiding this kind of lowballing can be tricky, but one tip is to check if they offer free coupons or processing vouchers. If you're dealing with an ethical, reputable company, it won't have to resort to these schemes to get your business.  

4. Offering insurance quotes in exchange for personal information or money

Fraudsters often call potential victims and offer a free auto insurance quote in exchange for personal information. This is a favored method for identity theft. Don't fall for it. The only thing you need to give to get an actual quote is the details about your car. In addition, if they tell you that you need to pay a fee before you can get a quote, walk away. Almost all reputable companies offer their insurance quotes for free nowadays. The only thing you need to pay for is the premium, not the quote. 

In general, if you're uncertain about buying auto insurance, steer away from companies that nobody has heard of, or those with no background you can research. If you're dealing with a new company, ask current customers for their opinion on the service. The more information you can get, the better.

If you want to be really sure, you can always buy your coverage from one of the big corporate auto insurers, such as State Farm and Geico.

Using a fake auto insurance policy is a crime, whether or not you were willfully doing so or not. The potential legal and financial problems far outweigh any benefits. Remember, always do your research and get as much information and confirmation on your dealer before signing anything binding. 

Five Tips for Lowering Your Auto Insurance Premium

Posted on Dec 16th 2009, 07:15 pm, under Improve Your Auto Insurance Rate

When you're shopping around for auto insurance, the premium cost is probably one of your key considerations. You may feel that the first price you see is a take-it-or-leave-it offer, but you'd be wrong. In fact, there are many things you can do to lower your auto insurance premium. Read on and find out:

1. Pay in cash up front.

If you've got the funds for it, you might find it better to pay for a full year of insurance up front instead of opting for a monthly payment scheme. You'll save more money in the long run, and on top of this, many insurance firms offer discounts for up-front payment. Even if you decide to switch insurance providers later on, you don't need to worry, because all insurers are required to pro-rate your bill and refund you for the time you aren't covered by their policy.

2. Drive carefully.

How well you drive is still one of the most important factors that insurance providers consider. Most companies look back at least three years, while some go back five or more. They'll check your records of major traffic violations and whether you've been in an accident. Any significant blemishes on your record could seriously raise your premium.

3. Drive less.

The less time you spend on the road, the lesser your chances of getting into an accident, and that's just how insurance providers want it. If you've moved closer to your place of work, or if you cut down on your mileage through other ways, ask your insurance company if you can get a discount. Some firms have programs that let you pay by the mile; if you don't drive a lot, you may want to look into this, since it could potentially save you a lot of money.

4. Buy multiple policies from one insurer.

If you've got several assets that need insurance, then it's best to buy coverage from a single company. Almost every insurance company offers big discounts to customers who buy multiple policies, whether it's auto, home, or life insurance. When comparing insurance quotes, you may find that some companies with high single-policy premiums are better deals over-all when it comes to multiple coverage.

5. Increase your deductible.

You might be able to reduce your total premium by up to 25 percent if you take out a bigger deductible. If you don't have comprehensive or collision coverage, or if you own an older, lower-value car, then taking out a large deductible might be the smart thing to do. Read more on how to pick the right deductible level for your budget here.

Next week, we'll have even more tips for you on how to lower your premium, so be sure to come back to check them out.

How To Save On Auto Insurance For Married Couples

Posted on Dec 16th 2009, 07:14 pm, under Find The Best Auto Insurance Quotes

Buying auto insurance for yourself is one thing, but buying it as a married couple is another thing entirely. You may not be aware of it yet, but there are several ways that you can save on auto coverage costs for you and your partner:

1. Ask for a discount up front. Because you're living together, it's assumed that you'll each do less driving than a single driver, thereby lowering your risk and your  insurance premiums as well. In addition to this, insurance companies have found that married couples, especially those over 25, drive more responsibly than single people. Lastly, all insurance providers want to start long-term relationships with their married customers, in the hopes of eventually covering the entire family. In fact, even before you get married, you may already be eligible for a domestic partner discount, so ask your insurance agent for more information. 

2. If you don't already have two vehicles, buy another one, if possible. In addition to the cheaper rate that married couples qualify for, you may also get a multi-vehicle You can also receive a multi-vehicle discount.

3. Take a look at each other's driving records. In particular, check if either one of you has received DUI violations or traffic tickets, since these may disqualify you from receiving any married couple discounts. The following will raise your rates as a couple: a poor record as a single individual, ownership of an expensive sports car, involvement in multiple accidents, and DUI records. In these cases, it is probably better to get separate auto insurance policies instead of joint coverage.

4. Check the statistics for car theft where you live. Is your home in a safe area? If not, you can expect your auto insurance rates and premium to be higher than usual. 

5. Since you've now combined your income with your partner, you should increase your coverage limits. This provides protection for your increased assets and income. Lastly, you should both name each other as the beneficiary on your death insurance.

Get auto insurance quotes online so you can do some comparison shopping for married couple discounts. Get as wide a selection as possible so you can find the best value for your money.