Does it pay to shop around liability only [was: minimal] insurance?

[markstache]

The conventional personal finance wisdom is "shop around every year" and "get three quotes as they will be different!"

I call "shenanigans!" on this, at least for Mustachians.

I have been calling around and putting in e-quotes for the last two days on my 2007 Kia and very modestly priced 1956 era house. Everyone is the same. For the auto, I don't want, much less need, collision. For the house, we just want a high deductible catastrophic event plan. All the companies are pretty much the same for both.

I know that insurance is a regulated industry, so perhaps I'm overly optimistic about playing the field, but I thought I could get some return on my time investment of calling around. So far, I'm going bust.

What are you experiences?

[Rural]

Carry inky liability and have never saved less than 25% by shopping around.

[marty998]

It depends... usually the 1st year premium is designed to suck you in, being heavily discounted.... so if you shop around after 1 year you may not get as good a deal as you would after 2 or 3 years (for car and house insurance).

Life, TPD and income protection are a totally different kettle of fish.

[markstache]

Carry inky liability and have never saved less than 25% by shopping around.

"Inky"?

Can you give more details?

[Paul der Krake]

I shop every year too. Every insurer has their secret sauce formula, and just because you are in insurer A is the best deal now doesn't necessarily mean it will be the best in the future. Especially early in your driving career, the competition is fierce and quotes vary wildly.

Since the formulas are secret and you can't run them all at home, the only way is to get quotes regularly.

As your driver history lengthens and your vehicles age (or are replaced), you may fall in or out of different insurers' sweet spots in their respective pricing functions.

edit: just for fun, here is the last history of my auto prices, for 6 months of premiums. My car has always had liability only, wife's always had comprehensive (with the highest deductibles)

2012: $192 (Allstate), $450 (Farm Bureau)
2013-2014: (moved to another town 10 miles away) $240 (Allstate) $400 (State Farm)
2015: $350 for both (!) after getting married (Geico)
2016: $400 for both, still Geico. Everyone raised their rates due to some redistricting, or so they said. Still cheaper than everyone else.

[markstache]

I shop every year too. ... My car has always had liability only, wife's always had comprehensive (with the highest deductibles)

I appreciate the concrete data points, but my theory is the difference in quotes is all in the comprehensive aspect of the quotes, not the liability. Do you happen to have separate quotes for each vehicle?

[Tjat]

What state are you in? Insurance prices should not be the same between carriers, no mater your limits unless you are in North Carolina.

[Paul der Krake]

I shop every year too. ... My car has always had liability only, wife's always had comprehensive (with the highest deductibles)

I appreciate the concrete data points, but my theory is the difference in quotes is all in the comprehensive aspect of the quotes, not the liability. Do you happen to have separate quotes for each vehicle?

Well, every first quote that I listed pre-2015 was for liability only back when I was shopping for just me. And they do vary quite a bit, I would typically get 1-2 dirt cheap quotes, and then a solid 20% gap with the next two, and then some crazy number from one of the full-service providers that try to lure you in with gimmicks like accident forgiveness and a hot claim adjuster in their commercials. This would occur regardless of the actual liability amounts.

Unfortunately I can't recall the quote breakdowns of the insurers I didn't end up doing business with since we combined the two vehicles under one policy.

What state are you in? Insurance prices should not be the same between carriers, no mater your limits unless you are in North Carolina.

Now that's interesting- I am in NC. Are you referring to the special high risk pool that's mandated by the state?

[markstache]

What state are you in? Insurance prices should not be the same between carriers, no mater your limits unless you are in North Carolina.

Illinois

Edit: wow. I'm terrible at the spelling

[fishnfool]

Having enough med pay is important to protect your assets (house), a good agent will walk you through the process to determine proper coverage. Having auto and home with same  company often gets you a discount. Beware of hidden broker fees some of the companies add on. Shop around but beware of going minimal. Not saying you need full coverage on a 2007 Kia but if and when you have a claim sometimes you get what you pay for.

[Hotstreak]

It depends... usually the 1st year premium is designed to suck you in, being heavily discounted.... so if you shop around after 1 year you may not get as good a deal as you would after 2 or 3 years (for car and house insurance).

Life, TPD and income protection are a totally different kettle of fish.

I found that you can stay at the same company and continue to get the discounted "new customer" prices.  Just sign up for a new policy with them instead of renewing your existing one.  You'll get a different policy number (at least I did) but otherwise the coverage is the same.  I kept working towards "loyalty" rewards like accident forgiveness too - best of both worlds!

[Rural]

Carry inky liability and have never saved less than 25% by shopping around.

"Inky"?

Can you give more details?

Should've been only. Stupid iPad thinks it knows more than I do.

[ohsnap]

I shop every year too. Every insurer has their secret sauce formula, and just because you are in insurer A is the best deal now doesn't necessarily mean it will be the best in the future. Especially early in your driving career, the competition is fierce and quotes vary wildly.

Since the formulas are secret and you can't run them all at home, the only way is to get quotes regularly.

As your driver history lengthens and your vehicles age (or are replaced), you may fall in or out of different insurers' sweet spots in their respective pricing functions.
...

I always checked around once a year or so but have almost given up hope on savings - for some reason we are in USAA's sweet spot and everyone else's sour spot!  We have 2 young adults on our auto insurance and ever since the youngest turned 16 our rates have gone through the roof.  But when I check other companies that purport to offer savings - GEICO, Progressive, and others - sometimes they are literally almost TWICE what USAA is charging us.

We do make the kids pay their share.

[neo von retorch]

Just another vote for "don't go minimal" - an agent (cross-company broker) once told me that insurance often lowers the premium for higher coverages, as it's a sign of being responsible. Just the other day, I was on Nationwide, and "basic" coverage ($15k/30k) cost about $40 more over 6 months than $150k/300k. Go figure!

[markstache]

To be clear, to me, minimal is 250/500. I'm not messing around here. I think my surprise is  not the the absolute amount of the quotes (they are all quite reasonable for the piece of mind I'm getting), but just the lack of variation. I'm glad every thing is "good;" I was hoping for one "very good."

[Tjat]

Now that's interesting- I am in NC. Are you referring to the special high risk pool that's mandated by the state?

Sort of. Liability insurance rates are capped by the NC Rate Bureau and for high risks or those where companies feel Bureau rates are too low they can write in the reinsurance facility instead (as you referred to as the 'high risk' pool). I would disagree with defining them all as high risk, as the bureau program is very old and unsophisticated vs modern insurers.

To be clear, to me, minimal is 250/500. I'm not messing around here. I think my surprise is  not the the absolute amount of the quotes (they are all quite reasonable for the piece of mind I'm getting), but just the lack of variation. I'm glad every thing is "good;" I was hoping for one "very good."

250/500 is what all insurers would classify as "high" limits. I'm sure everyone reading read your word minimal as "minimum liability limits required by law," which is a frequent reference by certain posters who choose to poorly insure themselves. In your case to limit confusion, I would rename your thread to "...shop around liability-only insurance." 

[ender]

To be clear, to me, minimal is 250/500. I'm not messing around here. I think my surprise is  not the the absolute amount of the quotes (they are all quite reasonable for the piece of mind I'm getting), but just the lack of variation. I'm glad every thing is "good;" I was hoping for one "very good."

We recently shopped auto rates, purely for liability coverage. For 500k/500k the quotes we had were:

• Geico     330.5
• USAA    412.96
• Progressive   442
• Amica   384 (500k/1M)

We ended up going with Amica because their combined home/auto was about $15/year more than Geico but they felt like a lot better customer service. We had called all them as part of our shopping process and Amica was not at all saleslike, whereas the Geico folks were clearly trying to make a sale.

There can be huge variation even if you have really low rates already just for liability.

[MoonLiteNite]

I have attempted to a few years ago, i thought my company was screwing me over as a 21 year old male, then 24 then 27. But every time i shop around, i get the same basic rates.
I just keep using my current one since i get a discount for having a house and been on their plan since i was 14 years old

[markstache]

250/500 is what all insurers would classify as "high" limits. I'm sure everyone reading read your word minimal as "minimum liability limits required by law," which is a frequent reference by certain posters who choose to poorly insure themselves. In your case to limit confusion, I would rename your thread to "...shop around liability-only insurance."

Mea culpa. Thread title changed as suggested.