Where are the best Auto Insurance rates in Cedar Rapids?

Where are the best Auto Insurance rates in Cedar Rapids?

Everyone knows that car insurance rates can vary by driver and vehicle as well as risk factors like driving record, vehicle use and mileage. But did you know that you can pay different rates depending on what part of Cedar Rapids you live?

Recently, a customer moved from one Cedar Rapids zip code to another. With no other changes, their auto insurance rate increased by $100 over the 6-month term. I thought it was unusual for such a large difference within Cedar Rapids and was curious how much your zip code affects your auto insurance rates. Using the same customer, I checked rates in each zip code in the metro area and here are the results:
 

auto-rates-by-zip

 
 
 
 
 
 
 
 
 
 
 
 

 Note: an index of 1.02 means this zip code is 2% more than the 52402 zip. This example was checked on Progressive. Each carrier sets their rating factors with approval from the Iowa Insurance Division who regulates insurance rates in the state of Iowa. Therefore, it’s important to note other carriers will not have the same rate differentials for the same zip codes.

In this example, the driver would pay $231 more in the SE Cedar Rapids zip code versus the NE zip code. I would’ve expected a large rate differential when moving to another state, as Iowa on average has some of the lowest auto insurance rates in the nation.

Why do auto insurance rates vary by location?

Insurers keep claims data by zip code. Those areas with higher rates of losses (insurance claims) will pay more than those with lower rates of loss. A higher number of accidents can lead to increased liability and collision coverage rates. Similarly, more losses from storms, deer strikes, vandalism or theft can lead to paying higher premiums for comprehensive coverage. For example Oklahoma has more severe wind and hail storms than Iowa does. Therefore you’ll pay more there for comprehensive coverage, which covers such loses, than in Iowa due to the increased risk.

It surprised me how much just moving across town, or in some cases just across the street, can affect your auto premiums!

 

Posted in: Cedar Rapids News, Insurance Tips

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Why chose an independent insurance agent?

Why chose an independent insurance agent?

When buying insurance for your car and home, there are three basic sources:

  1. Direct to Consumer
  2. Exclusive/captive Agents
  3. Independent Agents

Direct to Consumer

Insurance companies that sell directly to consumers include: Geico, Esurance, Progressive Direct, The General and others. These companies sell online and via call centers and offer the convenience of extended hours and online access. When buying this way you are probably making a lot of decisions on your own. For example, are state minimum liability limits adequate for you?  What coverage types should you have? Who pays when those limits are exceeded? If you’re making decisions based on paying the lowest price possible, you could be left under-insured or not covered at all. Instead of paying a little more on your premium, you risk paying the rest of your life for one mistake.

Many who buy insurance on their own believe it will save them money because they’re not using a agent. While it’s true that some people can get a cheaper rate like everything else, no one company has the best rates for everyone. Direct carriers may not pay an agent commission (typically 10-15%), however they do have other significant expenses. They pay people to staff their call centers, the website programmers and other overhead. Since there are no insurance agents bringing them customers, direct insurance carriers must pay more to advertise their services to you. Geico for example spent more than $1 billion in advertising in 2013, more than 6% of their premium revenue, according to data collected by SNL Financial. Since online carriers don’t assign you to a specific agent, you’ll talk to a different person every time you call rather than getting personal service from a licensed agent that knows you.

Exclusive/captive Agents

Exclusive or captive agents work for one particular carrier who sets the agenda for their agents as to what products they can sell. These companies such as State Farm, American Family or Allstate are often only sold through their own agents who are contracted or employed by the company. Therefore they generally have less options to offer their customers. If you want to check other carriers for a better rate or get coverage they don’t offer, you will need to find another agent. You may have noticed that many of the big exclusive carriers spend a lot of money on advertising to convince you that their insurance is worth more money.

Independent Agents

Independent are also local agents. However since they are independent from the companies they sell, they are able to offer multiple carriers. More carriers give independent agents access to different types of insurance coverage. This makes it more possible to find all your insurance needs at one local agency.

 

Benefits of an independent insurance agent

 

Since independent agents are not employed by the companies they represent, they are able to offer clients more carriers. Multiple carriers gives the independent agent more options to better fit your needs. For example one carrier may be a better fit for families with young drivers, one might have the best rates for empty-nesters and another may be better for drivers with multiple violations or accidents. And since these carriers have to compete for the independent agent’s business, they know they need to offer more competitive rates. Independent insurance agents are true business owners. Independent agencies are often locally owned and operated by people you have known for many years. Insurance Gurus will quote your auto and home insurance with Progressive, Le Mars, Safeco, AAA, Integrity, State Auto, MetLife, Dairyland, Foremost and others.

Cedar Rapids Insurance Agent – Ed Faber

You have many choices when it comes to finding good insurance coverage. For many people, their insurance decision comes down to trusted relationships. Yes, price is an important factor but when you need to use your insurance, what matters most to you? Is it the (well advertised) insurance company or is it your relationship with your local agent? An independent agent can offer the best of all worlds: personal service, professional advice and a competitive rate. Ed Faber is an independent insurance agent servicing clients in Cedar Rapids and the state of Iowa.

 

 

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Practice Iowa Winter Weather Driving Skills

Driving safely in Iowa's winters takes practice

Driving safely in Iowa’s winters takes practice

 

Save on your Auto Insurance with the Three P’s

Winter weather is upon us and once again we need to relearn how to drive on snow and ice. Drivers are more likely to get into an accident during the first snowfall of the year compared to all other snow days, according to a University of Michigan study. The National Highway Traffic Safety Administration advises the three P’s of safe winter driving:

  1. Prepare for the trip
  2. Protect yourself
  3. Prevent crashes.

A good way to prepare is to practice safe winter driving. We all may be guilty of complaining about other drivers who “forget how to drive” on ice and snow. Don’t be that driver! In the daylight, rehearse maneuvers slowly on snow in an empty lot. Remember to steer into a skid. If your car has anti-lock brakes, stomp down firmly on the brake. Anti-lock brakes automatically pumps the brake to prevent them from locking up and acting like a sled runner. If you don’t have anti-lock brakes you need to pump the brake manually up and down to slow the car without going into a full slide.

Maintain your car. Check the fluids, test the battery and check tires for wear and proper inflation. Keep an emergency road kit in your car along with extra clothing, blankets and first aid.

Remember stopping distances are longer on slick roadways. You can test the road conditions by braking well before you need to see how your car reacts and adjust stopping distances accordingly. For Iowa road conditions reports, go to: www.511ia.org. Call 511 or 800-288-1047 for road reports from the Iowa DOT.

Protect yourself by buckling up before putting your vehicle into gear. Sit at least 10” back from an airbag. Use child safety seats and make sure they are properly installed. Children are safer in the rear seat.

Prevent crashes by staying, getting plenty of sleep and avoiding drugs or alcohol. alert, avoid distractions while driving such as texting, adjusting the radio or GPS. Above all be a courteous and patient driver. That’s easier said than done so practice patience everyday!

Related: How to Save Money on your Auto Insurance

photo credit: Slippery Driving via photopin (license)

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How Deer Accidents Affect your Insurance Rates

Deer collisions can affect your insurance rates

Watch for deer and prevent injury and property damage.

 

 

 

 

 

 

 

 

 

You’ve always been a safe a driver. You’re heading down the highway at dusk and out the corner of your eye, you get a glimpse something moving and then, BOOM! After you calm down you realize you hit a deer and it really did a number to the front of your car. According to the Insurance Information Institute, car and deer collisions cost $4 billion a year. Iowa is ranked third in the nation for the likelihood of a deer collision.

Which insurance coverage pays for deer collisions?

Your auto insurance’s comprehensive coverage will pay for your car’s property damage caused by a collision with a deer or animal. Comprehensive coverage is sometimes called, “Other than Collision.” This is the same coverage that pays for damage to your car by many natural causes such as wind, fire, hail, flood or falling objects like a tree branch downed in a storm. Deer strikes are not considered a collision by insurance because the animal usually runs into your vehicle.

Comprehensive insurance claims are considered not at-fault. Therefore insurance companies don’t surcharge for collisions with a deer. Your deductible would apply, although some insureds maintain a slightly lower deductible on their comprehensive coverage than on their collision coverage. The reasoning behind this practice is some are willing to bear more of the risk for an accident they caused if they feel they are a relatively safe driver. The higher your deducible, the lower your premium cost.

Brake – don’t swerve

I had a customer who reported a deer related claim. Several deer had run onto the roadway at once and her instinct was to avoid them. She quickly jerked the steering wheel, putting the car into the ditch and damaging the car. The claims adjuster asked if she hit any of the deer. She said she wasn’t sure since it happened so fast. The adjuster asked if there was any physical evidence of the deer on her car such as blood or fur. There wasn’t any and subsequently the claim was ruled a collision, an at-fault accident. That triggered a premium surcharge and a loss of the safe driving discount, a double blow to the pocketbook!

No one deliberately wants to see an animal get harmed. However much more serious crashes can occur when you quickly serve out of your lane into the path of another car or object. Instead, stay in your lane and brake firmly if you see a deer coming into your path. Be on the lookout for deer especially at dawn and dusk when deer are most active.

Deer Season in Iowa

The regular shotgun deer season is roughly Dec. 5th through 20th this year. As deer are flushed out of their habitat they can end up running across roads and highways. Mating season or “the rut” also occurs in the fall of the year, typically late October to early November in Iowa. Be particularly vigilant and avoid an expensive encounter with a deer this season!

Learn More: Understanding your Auto Insurance
photo credit: Deer crossing the road

via photopin (license)

Posted in: Driving Tips, Insurance Tips

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Top 10 Largest Insurance Carriers in Iowa

Which insurance companies have the largest share of the property & casualty insurance market in Iowa? The following is based 2014 data, published in a recent issue of Viewpoint Magazine.

 

Top 10 largest insurance companies in Iowa based on share of market

Top 10 largest insurance companies in Iowa based on overall share of property & casualty market in 2014

  1. State Farm Group, 9.5%
  2. Allied Group – A Nationwide Company, 8%
  3. Farm Bureau P&C Group, 6%
  4. ACE INA Group, 4.4%
  5. Progressive Group, 4.1%
  6. EMC Ins Cos., 3.3%
  7. Travelers Group, 3.0%
  8. Farmers Mutual Hail Ins Group, 2.8%
  9. American Family Insurance Group, 2.9%
  10. QBE Americas Group, 2.9%

 

Source: Viewpoint Magazine, Summer 2015

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