Auto Insurance Quotes Online
The Internet has changed the auto insurance business so extensively that it no longer resembles what it was prior to the creation of the World Wide Web in 1992. Back then, when car insurance renewal time came around, an estimated sixty-three per cent of car owners ended up remaining with their insurer, according to the Insurance Institute of America. Today that figure is down to less than twenty-three per cent due to the abilitiy to obtain auto insurance quotes online.
As a group, insurance companies, brokers and agents combined to form a distinct group of what the marketing whizzes call “early adopters.” Now, a sub-group called skimmers has formed with Grey Power and the American Association of Retired Persons in the lead. These groups negotiate bulk rates for group members and in so doing skim off the cream of the car insurance crop. With the ease of obtaining auto insurance quotes online, competition for business is fierce.
A consequence of this, however, is that it has meant that certain insurers are skimming off low-risk drivers, leaving those willing to insure the typical new driver, male, with significantly lower ability to allocate risk. This is why insurance rates for new drivers have increased so dramatically that it has increased the number of males under 25 driving illegally, with no insurance at all. There are on-going debates in actuarial theory about the problem.
The benefits of online insurance shopping are so great for the consumer that it will only grow as the preferred way to shop for automobile coverage. The use of the Yellow Pages and telephone as the preferred method of shopping for car insurance continues to drop. By the time someone picks up the phone these days they have likely already checked out the insurer’s website, entered their vital statistics and gotten a quote.
When asked why they would shop online for car insurance in a 2001 Wharton School of Business survey, the most often response was the advantage of getting an instant quote. After all, who needs to seek advice from an agent? Many people don’t even know what questions they should be asking, and agents aren’t about to volunteer the questions they really don’t want to deal with.
An unintended consequence of the ease in obtaining online quotes for car insurance is the transparency of the risk profiling process. When shoppers answer the questions, they see what factor the make of their car plays, or where they live. They understand the financial implications of getting liability only, rather than full coverage.
Playing with the answers is a fine way of learning what other factors are taken into account when determining your rate. Who knew that where you live is a significant issue? And what about that speeding ticket? How much is that costing you? For this reason, using the internet to obtain auto insurance quotes online has skyrocketed.
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