If you're anything like me, you'd love to reduce your auto insurance premiums yet not reduce the protection you get. But do you have insurance agents as friends? I do. Two of them. So, after doing some research online, I talked to them about my findings.
My findings were many. Your premium's decided based on who you are (your driving, credit, claims history), the car you want to insure and where you live. Which makes perfect sense to me.
My findings also include two items that my insurance agent friends were not keen on, namely
a. retain the right to sue
b. don't sign contracts that include the words 'aftermarket parts' or similar ones.
Let me go into a bit of detail on these two, as they have important consequences for you, the auto insurance buyer.
Retain the right to sue
The mighty Internet says it's a good idea to retain the right to sue because without it it's easier for insurance companies to take advantage of you.
Basically, if you don't have the right to sue and you and the outfit you got your auto insurance from disagree about something (like the money they owe you if your car is totaled), you have to go to arbitration. If you retain the right to sue, you can, of course, get a lawyer and sue.
Lawyers are a lot more expensive than arbitration. So insurance companies have extra incentives to follow the contract the two of you signed, to settle.
One of my insurance agent friend's idea about retaining the right to sue? "It's true, but it doesn't really work that way. People get favorable results from arbitration."
I never disputed that arbitration cannot yield good results. Just that retaining the right to sue does it faster more often.
Aftermarket parts
IN case your car is damaged and you have the right insurance, the insurance company pays for repairs, including parts. Car parts can be made by the company that made the car or some other company. If they're made by some other company, they're called "aftermarket parts."
Originally, it seems, aftermarket parts were always inferior in condition, craftsmanship, and they were not as extensively tested. Now, some are as good as or better than the parts made by car makers. However, the perception is that they all are inferior quality. So, if your car has aftermarket parts, it's going to be perceived as being less valuable, you'll have to sell it for less than if it had original car maker parts.
I talked about aftermarket parts with the other insurance agent I know. He told me it's not true. Because, unless your car is one or two years old, almost everybody uses aftermarket parts. Which proves my point, not his. There are auto insurance companies out there that do not use aftermarket parts.
So, I say, since there are some, you should aim to get them to insure your car. I say 'aim' because it's not always possible. Your driving history, the claims you've made before might make it so that such insurance companies will not want to insure your care. But you should try. And you try either by crossing the 'offending' words out in the contract or by finding an auto insurance company that does not use them.
By the way, regarding crossing out words in the policy agreement, my insurance friends are saying 'Ain't gonna happen. No insurance company's going to accept that. Don't even try." I think contracts are mutual agreements. That means you have to agree too. Don't sign something just because it's there and they call it 'standard' something or other.
