The average cost of car insurance is now up to $1076, per year. That’s a lot of money. For anyone that buys full coverage (liability, collision and comprehensive) it’s even more.
Find out what your car insurance should cost. Use our car insurance calculator. It’s free. Just click the button below.
Our calculations for average price include all the drivers that buy liability only. This has the effect of bringing the average price down.
The right question may be can you afford car insurance advertisements?
According to McKinsey & Company, in 2011 the property casualty industry spent $5.9 billion on advertising , public relations and promotional costs. Amazingly, that now seems like peanuts. Fast forward to 2019 and just three companies — State Farm, Geico and Progressive — spent $4.8 billion.
It seems the large insurance companies think if they’re not on every sporting event and most other TV shows, we will forget who they are.
Unfortunately, advertising works. We’ve analyzed the results. The objectives of advertisements vary, but here are some of the results we see:
- People buy the “best price” sales pitch. They shift business to companies they think offer the best price. Even if they don’t.
- Consumers will pay more for companies with whom they connect with the advertisements
Consumers should take advertisements with a heavy dose of salt. Instead of believing ads, checkout how good the company actually is. If they offer a great product, and a good price, only then should you buy their insurance.
Words to Live By
“No matter how cheap your insurance is, if the company won’t pay a claim, the insurance was a waste of money.” That quote can be attributed to yours truly. I learned this the hard way. I had what I thought was a great insurance company. Then when I was hit by a car and no insurance company would pay my medical bills.
That’s when I got curious about how these companies really perform. That’s why ValChoice was founded. To bring transparency to insurance. We rate virtually every company in the industry. Click the button below and get a free rating on your insurance company.
Back to “can I afford car insurance?”
Does your insurance company spend heavily on advertising? If so, part of the premiums you pay are being spent to woo new customers. Is that how you want your insurance premiums spent?
Just for fun, I calculated how many times my medical bills could have been paid out of two $1 billion advertising budgets. Two because there were two car insurance companies involved. $1 billion because that’s the average advertising budget for large car insurance companies.
24,000 times. That’s the answer. 24,000 times is how many times the medical bills could have been paid from two $1 billion advertising budgets. Nevertheless, wooing new customers was more important. Instead, I had to pay the medical bills, then fight to recover the money.
Price isn’t everything. Quality is also important. ValChoice can tell you which companies provide the best quality. Check out our best 5 company pages. We list the 5 best car insurance companies in every state.
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