Affordable car insurance, what is it? Is it the cheapest insurance? Until now, it was hard to measure car insurance other than based on the following three criteria:
- The entertainment value of the companies’ advertisements
- Which companies had the most memorable jingles
That’s crazy. People buy cars based on performance, warranty and how the vehicle fits their lifestyle. People need to be empowered to buy insurance based on similarly meaningful information. Unfortunately, when advertising insurance there hasn’t been any real data available measuring the companies performance. However, measuring performance isn’t hard. There are three criteria people care about, all of which are easy to measure. The three criteria include: price (or value), how well the company honors their promise to protect (claims handling) and service.
If you’re a price shopper first, start with our car insurance calculator to find a fair price for your insurance. Just click the button below to use the calculator.
Continuing with the analogy of buying a car, the promise to protect is similar to how many seats are in a car. No one would buy a car with too few seats. Similarly, many people would not buy insurance that ranked poorly on fulfilling the promise to protect. But, until now, they didn’t know which insurance companies fell into this category.
The Relationship Between the “Promise to Protect” and “Affordability”
Surprisingly, the connection between price and quality is not clear. In insurance, a higher price doesn’t necessarily mean better product quality. However, this data hasn’t been available to consumers. Without data, marketing campaigns establish the perceptions of product quality. This helps explain why in insurance the biggest advertisers often have the highest growth rates.
Further explaining this phenomenon, in industries where product interaction is low, perceptions of product quality are not based on product performance. With limited product interaction, advertisements work well to form the perceptions and opinions of the products. In summary, a low level of product interaction and the lack of real data enables companies with large advertising budgets to succeed.
Transparency Helps Consumers Find Affordable Car Insurance
The affordability of car insurance is more than just the price. If poor coverage or an unreliable carrier results in a claim not being paid, that insurance becomes unaffordable. Even when sold at a low price, insurance that doesn’t willingly pay claims becomes unaffordable when the claim is filed.
Laws require people to buy car insurance. The cost of this insurance is $200,000,000,000 (two-hundred billion dollars) per year. This is a massive amount of mandated spending. It is not fair to consumers to be mandated to spend such a large amount of money, with no measure of quality.
The ValChoice mission is to fix the problem of people not knowing how to find affordable car insurance. Click the button below to get a rating on your car insurance company.
If the rating is not good, use our car insurance calculator to find a fair price. We can also help you find a better company.