You’ve seen the commercials and laughed at the ridiculous characters, but when it comes to figuring out which coverage you really need, insurance advertisements come up short. As an informed consumer, you want to educate yourself about the various insurance options and benefits available, but with so many advertisements flooding the airwaves, how do you determine which carrier and coverage will benefit you most? In this post, we’ll explore some of the most frequently advertised insurance features and what they could mean for you.
The first feature on our list is the Discount Double-Check from State Farm Insurance. You may have seen a certain famous football player lending his face to this commercial in the past. State Farm’s Discount Double-Check is a review of your insurance policy to ensure you are getting every discount possible. It is marketed as an ‘extra step’ that prevents oversight of savings. As beneficial as this may be, it is nothing you cannot get from another agent, aside from the fact that State Farm agents only search for discounts from State Farm, not competitors. With an independent agent instead, you can search and compare discounts from multiple insurance companies, which could add to your savings.
Safe Driving Bonus Check
The next feature we’ll cover is the Safe Driving Bonus Check from Allstate. Though it is frequently advertised, the bonus is sometimes misunderstood by consumers. The premise for this feature is that eligible drivers who remain accident-free for six months will receive a check worth up to five percent of the premiums paid during that time. The catch is in the first part of that statement, “eligible drivers.”
Allstate requires enrollment in the Your Choice Auto Program to qualify for a Safe Driver Bonus. Enrollment is contingent upon several factors, some of which may include your driving history and how good your credit score is. Furthermore, you must pay extra to be a part of this program, something to consider when weighing the costs against the return.
You could also seek alternative benefits from another insurance company. Most are willing to reward safe driving, some at no additional cost. For example, many insurers offer instant discounts on premiums for drivers with an accident-free driving record. Others may implement certain incentives to encourage safe driving, such as deductibles or premiums that get smaller over time.
Next up is GAP coverage, a feature that is not frequently advertised but still frequently pitched to drivers. With this coverage, you ensure the balance of your car loan is paid in full when you total your vehicle, even if your insurance company settlement is not enough to cover it. GAP insurance pays the difference between your totaled car’s cash value and the amount you still owe on it, allowing you to start over with a clean slate.
If you finance a car, you can expect your dealer or lender to offer GAP coverage on the spot. However, this third-party coverage can cost hundreds of dollars tacked onto the cost of your loan, not to mention the coverage is for the life of the loan, not just the early years when your balance is higher than the valuation. Instead of paying more than you need to for coverage you do not need, talk to an agent here at Gary Ellis Insurance about your options for adding GAP protection to your policy next time you finance a car.
We’ll leave off part one by acknowledging a feature that Allstate refers to as Accident Forgiveness. One of the company’s commercials shows a teen driver telling Mom and Dad that he wrecked the car, but not to worry because they have Accident Forgiveness. With this optional benefit, policy-holders will not face higher rates or penalties just because of a first-time accident.
This feature can be particularly beneficial for drivers who do not want unexpected surcharges or who have high-risk drivers, such as teenagers on their policy. However, the coverage typically comes at a cost. Fortunately, several insurers besides Allstate offer the same benefit. By shopping around for accident forgiveness benefits from companies like Acuity, Progressive, Nationwide, and The Hartford, it may be possible to obtain a competitive rate. With Integrity Insurance, the coverage may even be free for eligible drivers after five years.
Bundle and Save
We’ll pick up part two with a well-known Progressive commercial that promotes the ‘Bundle and Save’ discount. In these advertisements, homeowners are shopping around for car insurance and offered a discount for bundling home and auto with Progressive. It’s tempting, especially for drivers looking to maximize savings on insurance. However, nearly all insurance companies offer discounts for customers who purchase multiple lines of coverage. Usually, the savings are limited to those who combine auto with home, renters, condo, or townhome insurance, but some insurers also extend the discounts to RV, motorcycle, or boat insurance.
New Car Replacement
Next up is a benefit that Liberty Mutual has spent big bucks promoting in commercials. It’s called New Car Replacement, and it promises to replace your vehicle with a brand new one if you total it in the first year or before it reaches 15,000 miles. Since insurance settlements are usually not enough to cover the retail value of a new car, this coverage could save a driver thousands in the unfortunate event that the vehicle is totaled.
Whether you drive a brand new car or a used vehicle, replacement coverage options are actually available from many different insurance companies, not just Liberty Mutual. For example, some insurers provide ‘better’ car replacement for used vehicles, while others may extend new car replacement for several years. Travelers Insurance, for example, offers a Premier New Car Replacement program that provides replacement coverage for five years of ownership.
Name Your Price Tool
The Name Your Price Tool from Progressive has been around so long, it needs no introduction. The tool is designed to help drivers understand how variations in coverage can impact the cost of premiums. For example, by lowering or eliminating certain types of benefits, users can achieve a much lower quote for coverage. The problem is that price-conscious drivers may be tempted to accept a bare-bones policy, foregoing important protections designed to protect against major financial loss.
Instead of jeopardizing your assets, income, and financial future, we recommend prioritizing the quality of your coverage first. Always work with an independent agent to find a good value on the coverage you really need.
We’ll conclude this post by referencing an important coverage promoted by Liberty Mutual but available from nearly every insurance company. It’s called Roadside Assistance, and it is designed to provide help when you or another driver on your policy experience a flat tire, lock-out, dead battery, breakdown, or other covered event 24-hours a day. Though optional, many policy-holders consider the small cost of this coverage well-worth the peace of mind it provides.
For more information about advertised insurance features or how you can add a particular benefit to your coverage, contact an independent agent here at Gary Ellis Insurance today.