Creating The Best Auto Insurance Experience

Everything in life is somewhere else, and you get there in a car.

E. B. White

• How to be the best auto insurance customer.
• How to find the best auto insurance company.
• How to build the best auto insurance value.

Have you ever recommended your all-time favorite movie to a friend, just to find out your friend hated every second of it? Tastes are subjective, whether we’re talking about movies, music, art, or customer experience. Pop on over to Google and search Best Auto Insurance and you’ll find a mess of sites claiming that they’ve scoured the industry and returned with a premium list curated on your behalf. The truth is, tracking down the best auto insurance is about more than browsing based price. It’s about shopping for experience. And, more than that, it’s about forming connections. In short, it’s about finding the right people and determining whose customer you want to become. 

While not all insurance companies are created equal, state and federal laws determine with no slight structures exactly what a company can and can’t do. In that regard, they’re all effectively the same product. It’s not about finding the best auto insurance. It’s about learning how to use your skills as a prudent customer to create the best auto insurance experience for you. 

Take a moment and picture your favorite restaurant and imagine yourself walking inside. You know what the place looks like, what it feels like, what it smells like, and how you’ll feel walking out. Why? Because this is your favorite spot, it’s familiar to you, and in your opinion, it is simply the best. Now, imagine that you take a seat at your favorite table and you’re approached by a waiter you’ve never seen in your life. He’s rude, and inattentive, and makes you wait for extraordinarily long periods between taking your order, bringing your food, or refilling your glass. A single instance with this waiter may not be enough to sully your favorite restaurant for good, but it won’t help. 

Now imagine it’s more than just the waiter. It turns out that your favorite cook left to go work at a different joint down the street and so your favorite meal no longer tastes the way it used to taste. That, plus the rude waiter, could easily prevent you from returning, even to what you so recently regarded as the best restaurant in town. 

What does that have to do with insurance? Quite frankly, everything. Many of my customers initially do business with me due to price, sure, but pricing fluctuates regularly. Nobody stays with me because I’m the cheapest. They stay with me because I’m the best for them and I’ve proven it by creating an experience they come to prefer and expect. When you step into my office, you know who’s working the grill, who’s taking your order, and how you’re going to feel when you walk out the door. 

Everybody wants to save on insurance, but nobody likes to think about insurance. Maybe you’ve had a bad claim experience, a poor interaction with an agent or agency, or perhaps your price has risen too high. Whatever the reason, it’s important to remember that you as a customer have value. Companies are competing for your business, so you should march into your search with a full understanding of what you bring to the table. 

Before we dive in, let’s stop and ask: What is insurance? 

In brief answer, insurance is when one party purchases risk from another. Most of us simply don’t have sufficient funds to cover a full-blown accident. If I speed home from work today and total both my car and a Mercedes Benz, I don’t have the ability to replace them. I’m not a Rockefeller, a Vanderbilt, a Bezos, or Taylor Swift. I’m just a normal guy with a normal job and a normal income. Thus, insurance is a necessity. 

The price of insurance will, of course, be determined by a slew of factors and how those factors converge on a single point: You. Age impacts pricing, as we all know. So does marital status, location, choice of vehicle, number of vehicles, whether the auto insurance is bundled with other products, etc. But my advice: let that be the insurance company’s problem. You can’t control how old you are. You can’t reasonably control where you live or which vehicles call out to you and beg to belong to you. But what you can control is the full picture. 

I don’t want to tell you how much insurance I carry with the Prudential, but all I can say is: when I go, they go too.

Jack Benny

Who are you as a customer? What does an underwriter see when analyzing your data? Is the picture favorable or unfavorable, risky or safe? Insurance companies are decidedly not nonprofit businesses. They’re in it to make money, so it’s in your best interest to first analyze yourself. 

As an example, let’s take a bird’s eye look at one of my favorite customers: me. I’m a man, which makes me automatically more likely to cause an accident than had I been female, but I’m a married man in my mid-30’s and I own my home. That tells the underwriters that I have acquired a certain level of stability in a life I’m likely fond of living, so I’m unlikely to take risks in the same way that 22-year-old me might have done when none of the above was true and my view of mortality hadn’t fully set in. Having somebody to come home to every evening should make me drive more cautiously, so I’ll be rated as such. 

Add to the mix that, rather than living in Greenville proper, I live in a smaller town in its metro area. That means that I live around far fewer people per capita than, say, if I leased a condo in Greenville’s downtown. That means that rather than living among tens of thousands of other drivers, I live among only a few thousand. That, in turn, decreases my risk if you’re comparing me to a city-dweller. However, it means I’ll pay more than would my more rural relatives, who may only see a couple of neighbors per square mile. 

Next, there’s my driving record. I had one accident when I was seventeen and a second when I was twenty-eight. Because they’re both at least five years in the past, they’re not technically counted against me, but I’d be crazy to believe that underwriters don’t at least take a peek and wonder when the next might be. I’ll never achieve the pricing of a driver with a perfectly clean record, nor should I. But that doesn’t mean I can’t carve out a nice pricing model for myself by maintaining vigilance on the road and putting more and more years between myself and my most recent occurrence. 

Finally, we come to an oft-overlooked factor in the bird’s-eye-view of the customer: History. I changed insurance companies last year for the first time since I began driving. That means that for nearly two decades, I had the same insurer. Sometimes the price went up, and sometimes it went down, but for almost twenty calendar years I kept making my payments to the same folks, month-in and month-out. Why? Because for all those years, they were the best option for me. I was a single guy with a single car and I owned no home. The best I could hope for was perhaps to save ten bucks a month, but at what cost? Personally, I value my time more than I value my money, so the idea of spending hours searching and quoting in hopes of saving a few bucks each month wasn’t motivating. I didn’t understand at the time that I was doing myself a monumental favor: The favor of establishing history. 

How do you become a valuable long-term customer? Here are three tips you may not already know:

Changing insurance too often isn’t helpful in the long run. Let’s imagine for a moment that you call me up for a quote. You tell me that Allstate is going up on your rate, so you’re looking for something cheaper. I pull your insurance record and I see that you’ve only been with Allstate for five months and you’re bailing at the first renewal. Prior to that, you were at Geico for about a year, and before that, you’d done stints at Liberty Mutual, State Farm, Farm Bureau, the General, etc. Each time you’ve switched, you’ve had good reasons and that’s not in doubt, but it’s worth noting that you’ve created a pattern that must be taken into account. 

Most of the time there are human underwriters who finalize auto policies, but it’s generally an algorithm that determines your price. The way the algorithm sees it, if you change insurance often, then you’re asking this new carrier to accept the risk of a large loss, while also nearly guaranteeing that you’ll only hand over your hard-earned dollars for a brief period. The only way the algorithm can offset the risk of your short-term money is to increase your monthly rate. For the opposite reasons, you’ll receive a lower premium from the get-go if your history indicates loyalty. If you don’t switch often, you’ll lower your premiums. You’ll see loyalty discounts hitting your policies and, should you choose to take your auto insurance business elsewhere, you’ll receive a more impressive rate offer because your new carrier will implicitly understand the long-term value you bring. 

Roadside claims are still claims. Changing flats, giving tows, and lockout services are on most policies nowadays with no surcharge at the time of the service. They’re a tremendous benefit, but despite their low dollar amounts, they are still occurrences that must be calculated by those pesky algorithms. Ideally, they’re to be used sparingly and for emergencies. An abandoned vehicle is more likely to be stolen or vandalized, so these services are to make sure that you don’t have to leave your vehicle behind. If these services are something you think you may require regularly, it’s better on the budget, in the long run, to shell out for a roadside service that is not attached to your auto insurance. 

Body shops are your friend. They’ll give you a quote before you file a claim. Regrettably, I often see customers filing comprehensive claims before the damage is assessed, only to find out that the claim was wholly unnecessary. If you’re looking at a $500-$1000 deductible and the damage isn’t drastic, have somebody take a look. Body shops are competing for business too and you’d be surprised what can be repaired for about the price of a deductible these days. 

Remember, your business is valuable. Don’t give it away willy-nilly. Become a customer these companies want to have, then make them earn your business. Next, let’s talk about whose auto insurance customer you’d best like to be. 

It’s important for your own mental health that you purchase insurance from an establishment you trust. If you enter the open road without feeling that your insurance will assist you in the event of an accident, then you’re paying too high of a premium. Your monthly cost may be small, but you’re shelling out stress dollars and that can cost you your health. 

As we’ve established, state and federal laws have a laundry list of mandates which determine what insurance companies have to offer. While every site has its favorite list on which auto insurance company is best and why, the truth is that I can have a totally different experience than you do, even if we both get into an accident on the same day and we carry the same insurance. The products don’t differ much from company to company, but the people can vary from call to call, or from visit to visit, so understanding your own interaction style here is key. 

Do I want an agent? Agents aren’t for everyone. Companies like USAA and Geico don’t have them, while State Farm operates solely in captive agencies (branches that only offer State Farm) and Travelers and Progressive tend to be offered by brokers (agents who handle contracts with a few to a plethora of agencies). For those who prefer to do business face-to-face, as well as for those who like to have a single person in charge of handling their insurance matters, opting for an agency is a must. Personally, I prefer dealing with an agent, but finding the best agent requires having experiences good or bad, then learning from them and adjusting accordingly. 

Am I being appreciated? I can’t stress this enough: don’t be afraid to ask yourself this question or be diligent in finding the answer. Sometimes, the answer seems counterintuitive. For instance:

• A fictional teen named Adam signed up for Geico when he was seventeen and now he’s thirty-seven and his friend Dave just joined Geico at a much lower rate than Adam has. This surprises Adam. Dave is his same age, he drives the same 2018 Corolla, and Dave had a wreck ten years ago while Adam’s record is so clean it might’ve just been pulled from a Maytag washer. Adam is gripped by pangs of frustration in his gut and he can’t help but ask, “Why is Dave getting a better rate than I am?”
• A fictional woman named Deborah and her friend Sandy have both been with Progressive for ten years and neither has filed a single claim, Sandy just bought a brand new Yukon yet Sandy’s full coverage policy is five bucks cheaper each month than Deborah’s. This annoys Deborah to no end, seeing as how she drives an eight-year-old Highlander. “What gives?!”

There isn’t a great industry term to explain this phenomenon, so I’ve invented my own and I’ve tested it on my own customers. When you’re onboarded as a new customer, you establish what I call a baseline rate. The algorithm has made its initial assessment of who you are and how risky you are as a person. This initial impression does not change. Ever. For this reason, when you’re asking if you’re being properly valued, roll your memory back and reassess the conditions under which you acquired your current auto coverage. What was going on in your life? Oftentimes, this will explain your baseline. 

From the example above, Adam signed up for Geico at age seventeen and as such, his baseline was priced on being a youthful, unpredictable male. That evil algorithm will always see him as that youthful male, but the unpredictability dissipates with time and he’s met with discounts. What’s the catch? Adam likely maxed out his loyalty discounts at age twenty-seven, reaching the ultimate limits of the downward mobility in his pricing. Even if he’s saving 25% straight off the top of his premiums, he’s paying 75% of his youthful male baseline. Dave, however, had a single accident in an otherwise-clean adulthood. The algorithm sees Dave, a middle-aged man with only a single accident, as a valuable commodity to obtain and it offers him a much more favorable baseline. Even if Adam loves Geico, he’d likely see an enormous benefit from switching carries if only for six months before returning to Geico and getting the baseline he’s now earned. 

Deborah’s situation was a little different. What I didn’t mention was that Deborah joined Progressive when she was fresh out of a nasty divorce. The expenses of lawyers, moving, resettling, and keeping up with all the bills had become too much and while she didn’t file bankruptcy, she felt like she’d barely made it out alive. Her credit took quite a whopping and for the past decade she hasn’t thought much about her bill, or why it might be too high. She forgot that credit lent so much credence to insurance pricing and it wasn’t until Sandy got to bragging about her new Yukon that Deborah took note. It’s good she did, because between Deborah’s credit having recovered and the lengthy history she’s established, she’s due for a change and any carrier will be happy to cut her baseline rate by about a third. For these reasons and plenty more, it’s wise to stop and take inventory. What was going on in your life the last time you signed up for insurance? Have things changed since then? As a customer, have you become more valuable? If so, it might be worth shopping around.

             Having discussed how to become a valued customer and how to choose the company that’s right for you, we’ll move next into how the relationship should go. Remember, that’s what this is: a relationship. I can’t tell you how often I have customers begin a call with, “I’m so sorry to bug you with this,” or, “I’m sorry you have to keep dealing with me.” I’m always quick to remind them that helping customers is my job. It’s why I’m paid to be here and, since I work at a reputable company, I’m compensated quite well. Oftentimes this seems a foreign concept to these customers. “Wait, he wants to help me? What kind of witchcraft is this, anyhow?” These interactions always tell me that this customer hasn’t been valued in the past. When you’re only in the market for price, you don’t see the other benefits you may leave on the table.

                Don’t be afraid to ask questions, even the small ones. If your insurer doesn’t have time to answer your questions when it counts, or if they act like it’s a chore or a bother to do so, just imagine how you’ll feel when it’s claim time and your money is on the line. A little social discomfort up front may save a million headaches down the line.

                Know your coverage. Don’t be afraid to take it line by line, whether we’re talking limits, options, discounts, or add-ons. Make sure you understand what you have and why you have it. And again, same as above, if the representative handling your call or in-person interaction is unwilling or unable to explain all this to you, that doesn’t bode well for future needs and interactions. Your premium dollars pay their wages, so be sure you’re getting your money’s worth.

                Don’t get burned by the first problem. Customers often ditch their carriers due to bad experiences, which is sensible enough. But customers also often ditch their carriers due to a single bad experience, which may not be warranted. Everybody has a bad day or an off day. Maybe they didn’t have enough sleep, their child was sick, or they’ve had a death in the family. You never know. By the same token, maybe you’re not the only person to have a poor experience with that representative, in which case he’s likely getting canned anyhow. Businesses, after all, are made up of humans and humans are never perfect.

                Don’t keep on getting burned, either. This may seem obvious, but for many people, it isn’t. I’m shocked by the regularity I’ve seen customers doing business with the same agent for over a decade without ever being able to meet the agent, whether in-person or by phone. That’s unacceptable, yet it’s tolerated. Bad insurance agents, much like used car salesmen, are so common that poor service can often feel like a given.

There are worse things in life than death. Have you ever spent an evening with an insurance salesman?

Woody Allen

             Finally, let’s recap. We’ve gone over how to become a valuable customer, how to choose the best insurance company, and how to interact with them once you’ve arrived. To sum up, let’s hit a few takeaways so you can get back to your day and to your busy life.

Best is a subjective term. The best auto insurance for you may not be the best for your mom, your best friend, or your co-worker. If you’re in a tight spot, the cheapest auto insurance is probably the best. But rear-end another driver and you may find that customer service is worth paying for.

Insurance is about relationships. Relationships are based on trust. If you can’t trust your company, your agent, or your coverage, don’t settle. Shop around. At best, you’ll find a better rate or a better service. And if you don’t, then you’ll have learned that maybe your insurance isn’t so bad. There’s value in that too.

Minimized risk means minimized pricing. Every now and then, imagine yourself from another perspective. Namely, from your insurer’s perspective. (Remember that pesky algorithm?) Would you insure yourself? And if so, how risky would you be? Are there any habits you have which, if eliminated, would make you seem like a safer risk? If so, there are savings to be had.

Stay informed, but stay loyal too. It’s okay to shop around, but don’t jump ship too often. Give yourself a chance to earn loyalty discounts where possible and pay attention to the circumstances surrounding each switch. If it makes sense, then by all means, switch insurers. But try to avoid year-or-less stints.

Be insured, but be assured too. Price is monumental, but only to a point. If you worry about what’ll happen if you get into an accident, there’s probably a reason or ten for your worries. And they probably need to be solved sooner rather than later.

If you don’t know, ask. As insurance professionals, we have to take tests in order to receive our licenses, meaning that we ought to know most of the answers to the questions you have. If we don’t, it behooves us to find out.

Insurance is a business. And business is good! Insurance companies plan to make money off you and they’ll do just that. As crazy as it may sound, be glad. When insurance is functioning at its intended capacity, it’s a brilliant product. After all, you get to pay someone a moderately meager monthly sum to ensure that you don’t have to handle the nitty-gritty process involved in car accidents. The vehicles involved have to be towed, which costs money. Then they have to be stored, which costs money. Then they’re inspected, quoted, and determined whether or not the vehicle is worth repairing, then the money is allocated to either repair or replace the vehicle. Rental cars are arranged for and had and, depending on the severity of the accident, hospital bills or even funeral arrangements may be paid from the claim. Every step of that process involved multiple employees paid to handle those exact issues.

Claims can get far more complicated, even. Multi-car pile-ups are a nightmare. Injury claims, already emotionally distraught by default, become far more delicate once lawyers are involved. Some claims are simply gruesome, involving death, dismemberment, etc. It’s an ugly, tedious, drawn-out process with a laundry list of laws to be followed and boxes to be checked. It’s a service worth paying for and it’s a good feeling when you know you can rest assured knowing you’re covered.

Who has the best auto insurance? That depends on you. But I trust you’ll find out.

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