December 11, 2015

The Insurance Loyalty Surcharge

Have you been with the same insurer for eight years?

Did you know that staying with the same insurer can end up costing you more money?

Are you aware of the difference between a captive agent and an independent agent?

How long have you been with your insurer?  Who gets charged with Insurance Loyalty Surcharge?

 

Insurance Loyalty Surcharge:

The Insurance Journal has a somewhat new article titled: “Loyalty to Insurer Doesn’t Always Pay off for Drivers” dated June 30th, 2015.  In this article they reference a study done by the Texas Office of Public Insurance Counsel, that showed that an insured who has been with the exact same carrier for eight years could save “19 percent by switching” to another insurance provider.  Although a different state with separate independent insurance rates than California’s, this is a prime reason to either shop with numerous captive insurance agents or contact one independent insurance broker in California.   In other, simpler words, if you have been with the same auto or home insurer for more than 8 years, you should shop around.  Shopping around is pretty simple these days, as all you really need to do is to email your insurance declarations page to these agents or brokers.  Make sure you also provide your Drivers License Numbers and Date of Births with these documents.   If you are already using an independent broker, you may just need to ask them to reshop your policy for you.

Staying with the same insurer can end up costing you more money…

The article cites what is known as Price Optimization as a reason that your Insurance Carrier, may be charging you more and that may well be the case.  Other reasons include general insurance competitiveness that happens over time and the loss or addition of certain discounts from one carrier to another.  There are numerous other ways to trim your insurance bill.

Captive Agent, Independent Broker, Whats the difference?

Insurance agents that sell and service one insurance company or group of companies are typically called Captive Insurance Agents.  Insurance men and women that sell from a wide variety of insurance carriers are called Independent Agents or Independent Brokers.  As an independent insurance broker, I am often asked why I’m not affiliated with State Farm, Allstate, Farmers, or the like.  My typical response is that I was once connected with a captive insurance carrier and found the experience was lacking.  How can I shop my clients policies around to get them the most insurance for the least amount of money, if I am beholden to just one insurance company?   That is why I started an Independent Agency/ Brokerage based in Marin County California.

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Marindependent Insurance Services LLC is an Independent Insurance Agency and we serve the San Francisco Bay Area and its various communities.

Please see our disclosure.  Marindependent Insurance Services LLC is regulated by the California Department of Insurance.   Please consult a licensed insurance agent in your area for advice.  California License Number 0K10734.  415-294-5454