Many of you are familiar with the common television promotion in which a cute gecko promises to save you money if you apply for their cheap car insurance. Yet, is it true that you will save money, or is it another slick advertising gimmick put on by the glib admen of Madison Ave?
Since the advent of free quotes online a few years ago, literally hundreds of insurance companies have jumped on the bandwagon with the mission to urge customers to buy their cheap car insurance. The providers accomplish this using comparative charts displaying their rates against the competition and solicit you to choose them as the source for cheap car insurance.
However, is it possible for every car insurance company to actually be the cheapest? Yet, at least one company has to be more costly, otherwise, all prices would be the same. So, how does the cheap car insurance phenomena actually work?
The insurance companies employ a great deal of statistical data to determine a cheap car insurance premium to charge a specific customer, moreover, the standard set for individual classes of drivers will vary from company to company. The insurance companies are aware certain drivers are more likely to file a claim than others, and therefore some insurers are able to absorb the costs of higher risk class drivers than others. This is why a company is able to offer cheap car insurance while other companies have to charge more.
For example, Company Y writes 72% of their insurance to middle-aged (low risk) drivers. Since the number of claims filed by this particular demographic class is extremely low, they are better financially suited to underwrite more high-risk (males 18-25) policies and offer a lower rate to this high-risk class. The insurance company will solicit drivers in that high risk demographic to secure their business as a new customer. Even though the amount saved may be less than 15%, the consumer is (satisfied that he has received|glad to get} a cheap car insurance rate from a respectable company and the company is glad to have a new customer. They usually have special quotes about women car insurance.
Insurance companies are not in the business of publishing their secrets employed for formulating insurance premiums, for this reason, it is imperative you evaluate more than one cheap car insurance quote. Checking more than one online quote source will ultimately lead to a result of a quote that is within your budget. The caveman or lizard may not save you as much as your good neighbor, so be sure you are in good hands by comparing several online companies to get a cheap car insurance quote.
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