Best Car Insurance

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Consumer Federation of America (CFA) also discovered that higher prices of carinsurance don`t translate into improved service for consumers.

"This study confirms that consumers have to shop very carefully for insurance," said J. Robert. "The good news is that there are insurance providers that disburse minimal or no commissions, propose low motor vehicle insurence prices and have very good consumer service."

"Yet, this study also found many insurance companies in which high commissions translate into lofty charges, with no improvement in service quality," J. Robert claimed. "Great autos assurance on-line rates as well as good service could be found in case customers take the time in order to compare insurance providers."

Findings

CFA reviewed commission information from the twenty top writers of coverage for both individual passenger online auto ins and homeowners insurance. This total commission information combined standard commissions and contingent commissions (paid after insurance policies are sold and depend on unique sales or on profitability goals).

The research compared total commissions with price, insurer profitability and service quality as measured by grievance data and customer satisfaction indices. Consumer Federation of America (CFA) found that:

1. Insurance firms having lower commissions usually have lower charges. This isn`t always the case, so consumers have to shop carefully.

2. There`s no proof that disbursing higher commissions to an insurance agent or broker produces either better service or higher consumer contentment. Actually, there appears to be no correlation between the quantity of commission paid and the value of service supplied.

3. Some insurance companies offer very good deals. Other insurers have rates that are constantly high.

In less competitive industries, some insurance firms might be enticed to attract market share by offering higher commissions to agents or brokers with higher prices and, sometimes, higher profits for the insurance company. Credit insurance is one subject in which this kind of `reverse competition` is particularly common.

Tips for Consumers

We offer a number of advices for customers when shopping for vehicle assurance on-line:

1. Shop around! This study discovered that premium charges often rise with commissions, though this isn`t always correct. Consumers must be certain to get quotes from several of the lowest premium insurance corporations, including the direct writers of coverage that usually do not disburse commissions.

2. Customers do not need to pay more in order to obtain excellent service. A number of the insurers with the best service records have low costs and low or no commissions. It is worthwhile to shop among the insurance providers which have the lowest prices and the highest customer contentment/lowest complaint ratios.

3. To receive information regarding online cars assurance rates, review country price information guides. Nearly all the countries have price information guides. Usually, customers may download these guides from the state`s insurance department Internet site.

4. To receive complaint information on insurance providers, check with the National Association of Insurance Commissioners` site, www.naic.org.

5. Beware of going to just one agent or broker for car insure, even in case that insurance agent represents several insurance corporations. Customers have to be aware that some brokers representing more than one insurance firm could put the customer in a higher priced company which has larger commissions even if the consumer meets the criteria for a lower price. States don`t oblige insurance agents and brokers to put the client with the best policy for him.

6. Ask insurance agents or brokers the important questions:

Do you represent me or do you represent the insurance company you are recommending me?

What commission are you earning compared to the price of the autos assurance policy you are proposing me to purchase?

Am I getting the lowest cost among all the car coverages on line firms that you represent for which I meet the criteria?

What additional autoinsurance companies do I qualify for that you act for? What are the costs I would disburse at those insurers and what fee would you get in each insurer?

Do you have a contingency commission arrangement with the insurance company you are suggesting? Please fully elucidate it to me.

If I file a claim, do you act for me or the insurance firm in the claim procedure? Is your compensation in some way related to claims filed by me or additional customers of yours?

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