As a grown adult, one of the first thing you have to learn is how to take care of your money. The moment we dive into that conversation, things like HMO (Health Maintenance Organization), investments and insurance comes in. Why? Have you ever heard of the old adage in business that the only way to generate money is to spend it? Likewise, when you’re trying to hold on to your hard earned income, it’s best to accumulate knowledge about the three topics previously mentioned.
Insurers, as much as they would like to obscure the fact, cannot deny that their first priority is to stay in business. That’s what every businesses do. Before they can protect customers, their first line of thought is to protect share holders, owners and management. They have to make sure they continue to exist for the foreseeable future before they can spew out any promises to their target demographic. Don’t be naïve and believe the mission and vision statement on your insurers office by the letter; hence, be an adult about it.
An auto insurance company will treat you like a king the moment you walk through its doors. However, they are most certainly withholding more information than what they are sharing. As the customer, how can you make sure that you’re not getting the shorter end of the stick? You have to be well versed with their best kept secrets.
Car Insurance Secrets Your Broker Is Not Telling You
How do they come up with your car’s value after it’s deemed a “total loss”?
Insurers don’t want to get into the details of how they determine your car’s value because — well, it’s confusing. For one thing, there is no standard method of calculating the value of a totaled vehicle. Yes, they will be using software where they will input factors such as your car’s odometer and pre-damaged condition, but the values within that software are all “propriety”. This means that there is no way to compare it for certain. Another factor they take into consideration is local market value, other than that, the amount they’ll give you is ridden with mystery.
Here’s a lifehack you can do — disagree. Doing so can actually affect the valuation depending on how persistent you are. Some of the steps you can do are:
- Show them your records (regular oil change of every 3,000 miles, tune-ups, and mechanic repairs) of how you’ve managed to maintain your car in tip-top form.
- Present proof of any upgrades you’ve purchased to improve the stock parts of the car.
- Drive to three dealers nearby and grab price quotes of potential replacement cars, which you can submit to your insurer.
- If you’re still unhappy with the amount they’re giving you, you can ask the help of a lawyer to step in as a mediation or arbitration. Depending on the experience of the third party you’ll bring in, you can strike a higher valuation due to compromise.
Don’t forget to officially cancel your insurance policy when you switch insurers.
One product feature that auto insurance companies clearly iterate is the ability to terminate at any time. Customers misunderstand this as a major convenience, but in reality, you have to make sure everything is official even before you leave to another insurer. Most think that all one has to do is to ignore the bill and that the insurer will automatically perceive it as cancellation of policy. What will happen though is that the company will add another month’s worth of bill, which you have no choice but to pay.
How much your car model affects your premium?
No insurance agent will divulge this to you at will, not even the ISO, because frankly the insurance company pays for its bills, not consumers. The hidden truth is, each car model is given a rating of three to 27 by your auto insurance company — internally. You have to outright ask them before you purchase a car to make sure you take advantage of a policy you’re comfortable with.