Five Ways Car Insurers Fail
Despite the importance of car insurance, there are still areas where insurance companies are lacking. This guide will walk you through the five ways car insurers fail, including the multiple different ways to determine rates, the impossible to understand insurance jargon, poor customer service, and more. Use our free comparison tool below to find a good auto insurance provider with fair rates.
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UPDATED: Jan 18, 2021
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We’ll admit it. We think car insurance can be invaluable. Especially for those difficult times, such as getting your car back on the road after a major collision, or paying you for being off from work after your injuries from said crash.
And while we hope you never have to take advantage of the benefits of your auto policy due to an injury – we do want you to stay safe – we really do love it when car insurance pays off for our readers and policyholders across the United States. That’s one of the reasons it’s there.
This doesn’t mean that everything is great in the world of auto policies and deductibles. There are plenty of things insurers do wrong. Here are the five worst ways auto insurers fall flat:
5. Still Trying to Figure Out Social Media
That’s not to say some companies aren’t doing it right, however. With new entrants like iMingle coming onto the scene with social media as its primary marketing platform, and veteran online companies such as Esurance, which has been focused like a laser on online sales for years recently expanding their claims services on to Facebook. You can even watch your car being repaired online, through a web app, Facebook or even a smart phone.
But for every shining star, there are plenty of duds. We’ve been impressed with some of the social media efforts of automakers, but we’ve yet to see a single insurer get everything “exactly” right. We’re not the only ones who think so, either. Enter NetProspex, a business-to-business analytics and intelligence firm. They conducted a study of the effectiveness of vertical industries in their use of social media, which ranked insurers as a whole at 42 out of 50 industries.
4. Putting the Brakes on Fraud
The dirty secret about the $30 billion in insurance fraud that takes place every single year in the United States is that it’s passed on to those of us who pay out policies. In Florida, for example, auto insurance fraud has become so bad that it now costs the average policyholder there an extra $90 on their premium each year.
Insurance companies spend millions of dollars on advertising and lobbying efforts. There has got to be a better way than simply hoping law enforcement can catch up with every fraudster. We’d like to see lower premiums, and we’re certain nearly everyone will share our sentiment.
3. Telling You How They Price
We’ve gone over the various components of a car insurance quote. These include: how safe a car you drive, how expensive it is to repair, credit history, claims and driving records, gender, where you park at night and even martial status.
We know everything there is to know about the factors of a quote, with one exception. Because every single auto insurer has a custom underwriting formula, how each factor is weighed and priced by each insurer is unknown. That’s why getting multiple quotes is such a good idea for most consumers.
2. Insurance Jargon: It’s Greek to Most
Nearly every consumer agrees – policies are written in a language that’s wrought with complicated vernacular. That’s part of the reason we’re here – to make insurance easier to understand and to make sure you get the best deal possible.
While we suspect we’ll be waiting for some time for the language to become understandable for all through the elimination of strange jargon, you can always use our handy resource to look up the terms.
1. Keeping Customers Satisfied and Happy
While there are a handful of companies that do most things right, no company has perfectly satisfied customers. In general, the younger a customer is, the less happy they are with their insurance company. While some might maintain it’s the effects instant gratification and always connected have had, we think it’s more likely just the changes in generations.
To see which insurers are doing it right, check out the latest J.D. Power rankings. J.D. Power rankings are based on customer satisfaction rated in five separate areas: customer interactions with the insurer; price of premiums; types of policy offerings; policy billing and payment; and policy claims.