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Auto insurance
December 11, 2019
7:01 pm
Oscar
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Insurance brokers ads paint the picture that they are working on behalf of their customers but my experience is similar to Gervdog. They paint the picture that they shop the market for you and with their specialized knowledge they are able to compare apples to apples to offer you the best policy for your needs. They may actually do this when you first contact them as a potential customer but even then they don't actually shop the entire market because brokers have a group of insurers they deal with and so only shop within that group. And once they secure you as a customer they seem to get lazy.
Every year I get a renewal from the same insurance company and it's usually higher and then I have to phone the broker and ask them to look into a better rate . At that point it isn't good for them to come up with a better rate because then it's obvious they haven't been proactive on my behalf and so they usually don't find a better rate.
I have never had a insurance broker contact me in advance of my insurance renewal with a list of available insurers and the correspoding premiums based on my existing coverage with an explanation of the pros and cons of each respective coverage and recommendations based on their observations of each company and I would be surprised to put it mildly if someone has had that level of service.

December 11, 2019
7:23 pm
Londonguy
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Oscar said
Insurance brokers ads paint the picture that they are working on behalf of their customers but my experience is similar to Gervdog. They paint the picture that they shop the market for you and with their specialized knowledge they are able to compare apples to apples to offer you the best policy for your needs. They may actually do this when you first contact them as a potential customer but even then they don't actually shop the entire market because brokers have a group of insurers they deal with and so only shop within that group. And once they secure you as a customer they seem to get lazy.
Every year I get a renewal from the same insurance company and it's usually higher and then I have to phone the broker and ask them to look into a better rate . At that point it isn't good for them to come up with a better rate because then it's obvious they haven't been proactive on my behalf and so they usually don't find a better rate.
I have never had a insurance broker contact me in advance of my insurance renewal with a list of available insurers and the correspoding premiums based on my existing coverage with an explanation of the pros and cons of each respective coverage and recommendations based on their observations of each company and I would be surprised to put it mildly if someone has had that level of service.  

About 10 years ago I left AXA and went with a big bank insurance company after I discovered they use salaried employees rather than commission agents to do the donkey work in the background, i.e. at a much lower cost. My combined home and auto premiums immediately went down by about 30% and I've never even considered going back to a brokerage arrangement

December 11, 2019
7:24 pm
NorthernRaven
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pooreva said
So where do you think broker gets his salary? It gets it from the difference what insurance company charges and whatever (s)he can get from suckers. He might get better rate from insurance company A if he sells the most form it. Is he going to pass saving to you? Dream about...
Same as buying car; instead of buying from manufacturer directly, we have 'dealers' who are going to get squeeze every single extra penny from you.
You should use one of those insurance quote sites and then call each of cheapest 3. Never deal with brokers. They are middle man and they have to earn some buck.
Johnson insurance has good rates.  

This is actually not correct. My understanding is that premium rate would be provided by the insurance company to the broker, and brokers are not "marking up" that rate. Instead, they receive a commission from the insurance company, as a percentage (auto seems to generally run around 7-15%). If an insurance company sells both directly and through brokers, I'd suspect the quotes would be the same.

There is also "contingent commission", which is more like profit sharing between the insurance company and the broker. After calculating all claims, expenses etc. related to the broker's entire book with the company, the company will share a certain percentage of that nominal "profit" with the broker.

It seems unlikely that a broker would be willing to (presumably) actually lose money by reducing a $145 policy to $93. Also, I think in many cases even if you work through a broker, you make your payments directly to the insurance company, in which case there would be no way for a broker to subsidize a policy. I'd be much more willing to believe that either the $93 policy wasn't from company A, or it had different coverage/deductibles from the $145 policy.

December 12, 2019
6:35 am
savemoresaveoften
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yeah quotes from the insurance company and the broker just passes it on. Broker earn a commision upfront plus a recurring fee every year as long as the policy is in place. A broker has no authority to raise / lower the premium.

There are numerous insurance companies that one can deal direct without a broker.
Always make me wonder if thru a broker indeed saves you some $$ cuz they "shop" for you. I would think they do that during onboarding but not every year. Its all about onboarding new customers and not save $ for the existing....

December 12, 2019
8:50 am
Bill
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University alumni, professional associations or unions often have group plans with insurers, might be another option for some to consider. I've been with one for years, at the time it was the most competitive but I wonder if it still is as I just keep paying the increased premium year after year. It's time consuming to shop around every year, I can't be bothered though it's probably costing me money, I figure the industry takes advantage of that.

I know someone who's been sued for $1.5M for a car accident and their insurance company of over 40 years has been nothing short of fantastic in reassuring them they have nothing to worry about, that they'll handle it all over the next up to 3 or more years it could take to resolve, don't give it a moment's thought. I don't know if the fact that it's a longstanding, loyal customer makes any difference but the reassurance has made life a lot easier for these people. There's more to insurance decisions than just getting the lowest premium from some fringe company, in my view.

December 12, 2019
6:05 pm
Briguy
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If you've had a traffic ticket within last 3 years you might as well stick with same company since most likely the new quote will be higher because of that.

December 13, 2019
6:20 am
Loonie
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As I understand it, each insurance company has an army of people who analyze the claims that THEY are paying out, and then they revise their rates based on their experience with their own clients. Perhaps some generic factors also enter into it, but it's about profitability for each individual insurance company, so they have to look at their own costs versus what they charge, and be competitive enough to retain and gain market share.
So I don't think it necessarily follows that cheaper is worse. You may fit the profile of someone who is unlikely to make a claim according to one insurer but be higher risk according to another - based on their experience with people like you - your age, gender, geography, the car you drive, etc.; tickets and previous claims would be an add-on. The policies in Ontario are all standard, are they not?
To me, the most important thing would be customer service when you need them. But, unfortunately, you can't know how good that will be until and unless you need them to pay out.
Hence, I would say, listen to the experiences of friends and relatives who have needed to make a claim. Price is important, but reputation is uppermost.

And, no, I don't know anyone whose premium has dropped. The only time car insurance ever drops or comes close to it is when the government of the day re-jigs the coverage so that you get less coverage - particularly medical. When all is said and done, you are actually paying more, but it isn't immediately obvious because it is camouflaged by the fact that the coverage was decreased.

When I look at all the idiot drivers out there, especially driving in unsafe conditions, I don't think it's possible for rates to truly decrease. It would be nice though if people like us who simply will not drive when the weather is bad got a break.
I do not take kindly to government promises to reduce insurance rates because I am pretty sure that, if they do it at all, it will mean reduced coverage, which is already at bare bones in my view. You can be sure it will be done in "consultation" with the insurance industry. The insurers won't lose a penny, but you could be SOL on some aspects of coverage. Have you ever read your policy?

And here's my other tip. When you are buying a car, don't buy until you've spoken to your insurer. Get a quote before you make a final decision. Careful drivers tend to be the kind of people who buy cars that have higher safety ratings; these in turn attract lower insurance rates.
It can make quite a difference. When I upgraded from a 12 year old car to a brand new one which was safer and more comfortable and much more to my liking, my insurance cost hardly went up at all, even though I had already dropped collision coverage on the old car. The new one had a much better safety record and design features. I must admit I was really surprised about this as I just assumed it would go up several hundred dollars.
So, buy yourself a good safe vehicle. Not only will the insurance be lower, you will be safer! win win!

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