When it comes to something as important and as intricate as extended car warranties, most consumers want a straight, simple answer as to what they need.
They want the lowest price for the necessary coverage.
The auto insurance industry knows this, and companies take advantage of it.
This is why online quote calculators exist and are so popular.
However, the problem is that using online quote calculators will most likely do more harm than good for consumers.
There are various reasons for this, but the main ones are that consumers will almost always select the lower price, which comes with the lowest coverage, and that the best insurance carriers do not participate in these services.
What’s the problem with going for the lowest quoted price?
Imagine you’re driving down the highway and you get into an accident.
Nothing huge, but some repairs will be necessary.
You’re calm because you’ve been paying $200 a month for the past two years for AverageJoe’s Extended Car Insurance, so they’ll take care of it, right? Right?
Well, it’s possible that because you chose the lowest quote, you also received the lowest coverage, meaning your repairs will not be covered by your insurance carrier.
That’s $4,800 you just threw away, plus the added cost of repairs.
The problem here is that your choice was based on a low quote, not on the best insurance carrier for you and your needs.
We set out to investigate why the best insurance carriers don’t participate in quote calculator services and what’s a better, smarter option for consumers.
In order to do this, we spoke to experts in the car insurance industry including representatives from major insurance carriers and the CEO of ConsumersAdvocate.org, Greg Powell.
ConsumersAdvocate.org is an authoritative voice in financial and consumer decisions.
“So, one of the first things to understand about the auto insurance industry,” Greg told us, “is that every company is really focused on a very different segment of the market.
If you are a new driver versus a very experienced driver, if you are a high-risk driver or a low-risk river, there are different insurance companies that are really trying to design the right policies for those different types of consumers, and one of the challenges when shopping for car insurance is trying to understand which segment you fall into.”
This is why just picking the lowest quote from a calculator is not recommended.
You can get far better coverage for around the same price from an insurer that focuses specifically on drivers like you.
State Farm, one of the major insurance carriers in the industry, seems to share this sentiment.
A representative from the company had this to say regarding choices based on price, “State Farm does not see insurance as a price-only driven purchase.
While consumers can buy auto insurance from State Farm through a local State Farm agent, through a call center, or through statefarm.com, we see the purchase of insurance as something that needs to be considered beyond just price.
Anyone can contact one of our 19,000-plus agents, who can help service all their insurance needs, not just auto.
So, what’s the fix?
ConsumersAdvocate.org has created a special kind of calculator that focuses on customer experience and market segmentation.
This means the company’s calculator matches you with the best insurance carrier for your needs.
“When we started to design our auto insurance calculator,” Greg said, “what we wanted was to help consumers find out which segment they fall into and to do so without getting a bunch of spam.
So, we realized that a better product experience would be to simply show consumers which company wants their business, based on asking them specific questions and then leaving it up to them to decide whether to get a quote and find out exactly how much they would pay.
The consumer has total control.
The long and the short of this is that ConsumersAdvocate.org’s calculator determines what type of driver you are without requiring any personally identifiable information (PII) and matches you with an insurance carrier that is actively looking for drivers like you.
And since that company specializes in insuring drivers just like you, it’ll probably be able to provide you with the level of coverage you need at the most competitive price.
You might be wondering how ConsumersAdvocate.org’s calculator knows what the major insurance carriers are looking for.
The company has partnered with several different data providers who the carriers all work with.
“This is one of the little-known things about how insurance companies reach customers,” Greg told us, “The insurance industry has several different data collectors where insurance companies can volunteer who they’re looking for: this age, in this zip code, with this specific driving history.
So our calculator pulls together all of the data from multiple sources, giving consumers the opportunity to see which carrier is most specifically targeting their business.”
Avoiding Spam and Identity Theft
Online quote calculators that require your contact information in order to give you a quote are most likely selling your contact information as leads to insurance agencies.
According to a recent article published by the Wall Street Journal, “many price-comparison sites are lead generators, meaning they sell shoppers’ contact information to insurers and agents.
The price they receive runs from $2 to more than $20 per lead, market participants say.”
This is why within 5 minutes after finishing up your calculations, you’re suddenly spammed with calls and emails from multiple different insurance agents.
ConsumersAdvocate.org’s calculator eliminates these risks.
Because this calculator only requires general information, there’s no risk of having your data sold as a lead to insurance carriers.
Every 2 seconds someone becomes a victim of identity theft in America.
According to a 2017 study by the Identity Theft Resource Center (ITRC) and CyberScout, there were a record-high 1,579 data breaches (incidents in which an individual’s personal information is put at risk because of exposure) in the US.
Personal information at risk of being stolen includes name, social security number, driver’s license number, medical record, financial record, etc.
Identity theft can leave victims in tremendous financial and psychological stress for years, making it crucial for consumers to protect their personal information as much as possible.
“There are plenty of companies that are going to spam you on the internet, but ConsumersAdvocate.org is not one of them.”—Greg Powell
How does the calculator know how to match you if it’s not asking a lot of personal questions?
The goal isn’t to give you a quote, it’s to connect you to the best insurance carrier for you–without any spam.
To do so, the expert researchers at ConsumersAdvocate.org realized that the most important aspects in insurance carriers’ actuarial math (essentially, the way in which these companies assess risk) only requires general information.
While other calculators might require you to give out details about your car’s model, make, year, usage, etc., ConsumersAdvocate.org’s calculator only asks for the basic—but essential—information needed to find your best match.
The first piece of information you’ll have to provide is your zip code.
This is essential information because insurers take geographic location into account: population density, traffic statistics, and disposable income.
The more people populating a certain area, the more cars on the road and the higher the possibility of accidents.
The higher the disposable income in an area, the more luxurious the cars on the road, the pricier it is to cover them.
Next, the calculator will ask you whether you are insured or not, this is because a driver who’s been insured for a long time is less of a risk than a driver who has never been insured.
It’s also good information for figuring out whether you’re currently with the best insurer for you or not.
Finally, the calculator will check if you are eligible for any discounts by asking you a few simple yes or no questions like whether you’re a homeowner or not and whether or not you have an active license.
That’s it; you’re done: check out the best insurance carriers for you.
“At the core of it, we’re trying to empower consumers with more information than they had before.”—Greg Powell
Here’s the best part: All major insurers participate in ConsumersAdvocate.org’s calculator.
Remember, major insurance carriers typically blacklist calculators, but because the calculator used by ConsumersAdvocate.org isn’t a quote calculator or a leads-generator, major insurance carriers participate.
It’s also worth pointing out that the major insurance carriers all have partnerships with ConsumersAdvocate.org, meaning that there is an established relationship and trust between them, making the calculator even more reliable.
Speaking of reliability, ConsumersAdvocate.org’s team of editors spends over 200 hours researching each and every product, service, and the company they recommend, making sure that they are not only reputable but the best in the industry.
The company’s priority is to make sure consumers are well-informed and have a positive customer experience.
Check out ConsumersAdvocate.org’s calculator to get matched with the best insurance carrier for your specific needs.*While we make every effort to keep our site updated, please be aware that "timely" information on this page, such as quote estimates, or pertinent details about companies, may only be accurate as of its last edit day. Huntley Wealth & Insurance Services and its representatives do not give legal or tax advice. Please consult your own legal or tax adviser.