Shopping for Car Insurance

[dpm802]

I've been with Geico for about 5 years now, but my latest policy renewal (in March) saw my premiums jump up about $125, to $550 for a six-month policy.

When I called them to inquire, all they could say is "Sorry about that ... we re-evaluated all the New Jersey drivers. Don't take it personally, it has nothing to do with you."

Well, I do take it personally, since I personally have to pay these new premiums.

I own my car outright, so I only need liability insurance. I have no accidents for almost 20 years, and no tickets going back at least 10 years.

Back in March, I shopped around for quotes, and most companies were offering me rates in the $360 range. Sounded good, but I didn't get around to committing to make the change until last week. In the meantime, my Geico policy automatically renewed, and I paid the higher premiums.

So last week I called Allstate to switch over. They were not the absolute rock-bottom price quote I got in March, but they are a national company with lots of agents. When I called them last week, I gave them the same information, they crunched the numbers, and now, all of a sudden, they want to charge me even more than Geico! They still had the $360 quote in their records, but could offer no explanation as to why the new quote was so much higher.

Today, I logged on to Traveler's Insurance ... their website couldn't generate a quote online, so they referred me to talk to an agent on the phone. After giving all my info, she crunched the numbers, and they can't insure me AT ALL, unless I go for the highest category of Bodily Injury protection. And they won't write a policy for me until I've been with that higher protection for at least six months with another carrier.

*** is going on here? I need to lower my insurance bill, but why are all these companies backing out of the good prices they quoted me in March?

Anybody have any advice ... or is everyone being screwed over? I particularly want to hear from my fellow NJ drivers, but of course everyone is invited to chime in.

 

[Leche]

Insurance broker. Ask around, my wife's family has been doing business with our broker for close to 20 years so he's solid. With ours he applies our specifics for discounts, multi policies, etc. We learn what's the cheapest, whats the best coverage, and whats the best blend.

 

[laconic1]

Were there any changes in New Jersey law that recently took effect that might affect prices? That does sound odd that there would be such drastic changes with all companies. I've been with State Farm in Colorado for almost 15 years now, and my rates have either gone down or stayed the same for about 6 years now, even with a couple tickets back to back on my record 4 years ago.

 

[dpm802]

Insurance broker. Ask around, my wife's family has been doing business with our broker for close to 20 years so he's solid. With ours he applies our specifics for discounts, multi policies, etc. We learn what's the cheapest, whats the best coverage, and whats the best blend.

That's what I'm looking for is the best blend. At first, I just asked for the cheapest coverage that would make me legal to drive. But when I checked what I was actually covered for, it was virtually nothing at all. So I bumped up my coverage to more reasonable levels, and it only raised my premiums a few dollars a month.

Geico was pretty good to me when I opened my policy 5 years ago. Their rates were far below every other quote, and they have crept up just a little over the years. But the last renewal just went crazy.

 

[dpm802]

Were there any changes in New Jersey law that recently took effect that might affect prices? That does sound odd that there would be such drastic changes with all companies. I've been with State Farm in Colorado for almost 15 years now, and my rates have either gone down or stayed the same for about 6 years now, even with a couple tickets back to back on my record 4 years ago.

I don't know about any changes to NJ law ... neither do the brokers I've talked to, and they should be more informed about all of this than I am.

I don't mind paying for something I need to have. But now, I feel like I'm being gouged.

BTW, none of the people I talked to at work have noticed any change in their rates.

 

[Hutch1]

Stay away from the companies that have dedicated agents and find a broker... and definitely stay away from Allstate. The independent agents will place you with the best company that matches your profile thereby getting you the best rates.

 

[Austin]

I remember reading a few years ago that NJ had the most car thefts in the country. Overall risk determines rates for your area. Unfortunately, everyone pays for the risk. Another factor that can affect your premium is your credit score. The lower the score the higher the premium.

I dropped Geico after 15 years when their premiums kept rising. When I got ready to cancel, they offered me better rates. Go figure. Good luck.

 

[Big Kev]

Insurance broker. Ask around, my wife's family has been doing business with our broker for close to 20 years so he's solid. With ours he applies our specifics for discounts, multi policies, etc. We learn what's the cheapest, whats the best coverage, and whats the best blend.

The broker is awesome.

Me and the wife recently bought a house. It was suggested by our finance people to shop around for insurance and she happened to drop the name of a friend of hers that was a broker. I had been with State Farm for 15 years, no accidents, tickets, or other claims. I got a far better deal with the broker. We are saving close to $700 a year (between the house, vehicles, and other policies), and we have Travelers now. I will never go back. She is great to deal with and she is our agent, so she is local. I would look into a broker if you can find one. I never knew they existed before we bought our house.

Let a broker do the shopping around work for you. I called a few other places when we were looking for insurance. The broker ended up with the best price out of all of them.

Edit. I also ended up with better coverage than what State Farm could give me, for less money. I even emailed the policy quote to my person at State Farm and she told me she could not beat it.

 

[ackvil]

I can tell you my experience, which was a few years ago. I lived in NJ for over 40 years and paid very high auto insurance (I understand that the loss rate for stolen cars and accidents is very high there.) I changed jobs and moved to CT and my insurance rates dropped by more than 25%. I moved to FL and my insurance went up 3%.

Friends of mine who still live in NJ all complain about the high rate of insurance.

According to my insurance friend here are a few of the reasons you pay so much for insurance in contrast with other states:

1. Demographics – With its 1,065 people per square mile, New Jersey is the most densely populated state in the nation. As a result, NJ has more registered motor vehicles per square mile (782) than any other state. Add to this New Jersey’s more than 34,000 miles of roads and highways. Note, for example that there were more than 250,000 reported accidents in 1998.

2. Lawsuits – When you consider that more than 164,000 "pain and suffering" lawsuits were filed in the last three years in New Jersey, you can begin to understand the enormous costs incurred by insurance companies to defend policyholders against these suits and to settle these types of claims. New Jersey insurers have paid more than $12 billion in the last eight years to resolve these types of lawsuits.

3. Medical Costs – The rising cost of medical care continues to be a major contributor to the cost of auto insurance in New Jersey. Insurance companies have paid over $3.2 billion in the last four years for medical claims resulting from auto accidents.

4. Insurance Fraud and Abuse – The Washington D.C.-based Coalition Against Insurance Fraud estimates that auto insurance fraud and abuse annually costs each household in New Jersey $297.50 or about $800 million a year.

5. Auto Theft – Auto theft in New Jersey continues to be a major cost factor. While the number of auto thefts has decreased in recent years, the cost of replacing stolen cars and parts continues to increase. Newark, Trenton, Asbury Park, Camden, and other cities have very high rates of insurance and thanks to politicians in the State, everyone pays for this.

6. Uninsured Drivers – There are an estimated 400,000 to 600,000 uninsured drivers on New Jersey’s roads and highways. When an uninsured driver causes an accident, he or she may be fined or penalized for driving without insurance, but it’s the insured driver’s insurance company that pays for the damage.

7. High Cost of Living – New Jersey’s cost of living makes auto repairs and medical treatment more expensive than in other states.

If it is any consolation, insurance rates in NJ for the year 2009 were the highest in the country.

That and the high cost of living, taxes, etc. is why I moved to FL when I retired.

 

[noahpictures]

Is Mercury available in your state? If so get a quote online if you can. Great customer service like AAA but cheaper.

 

[_JP_]

I've been with Geico for about 5 years now, but my latest policy renewal (in March) saw my premiums jump up about $125, to $550 for a six-month policy.

When I called them to inquire, all they could say is "Sorry about that ... we re-evaluated all the New Jersey drivers. Don't take it personally, it has nothing to do with you."

I see that you're a Veteran, which qualifies you for USAA. If you haven't checked them out the do so! Not only do thye give fair rates, you also get a check annually when the divest the profits back to the membership.

New Jersey has pretty much always had the highest insurance rates in the country.

 

[gaseousclay]

i'm with progressive and so far they've proven to be the cheapest of the insurance companies i've looked at. my wife and I pay $85 per month (for 2 cars) for full coverage + they offer free coverage for your pet in case you get into an accident and your dog gets injured.

 

[Go West Young Man]

It's cause Snooki is back from Miami.

 

[Kouros]

The basis of GEICO's business is that it was created for government employees because their tests proved they were better drivers than the general population and should be rewarded. The problem is that GEICO also discriminates against other occupations based on their "tests" which prove people with certain occupations are less risky to insure than others. You get the picture.

 

[xpavar]

If you are eligible, USAA is the only choice.

 

[Uncle Erik]

I don't know, but you might want to contact the NJ insurance commissioner to see if you can file a complaint about the increases. Probably not, but I have zero sympathy for insurers - they're one of few businesses I always play hardball with. You can never give them the benefit of the doubt. Every time I need something (which is very infrequently - haven't had a ticket or accident in over ten years. No claims for theft or loss filed, either.) I usually have to accompany the request with a threat of some sort just to get them to conduct ordinary business. I hate having to do that.

See if you can get any cheaper policies from other companies, even the fly-by-night ones. Go to your company and inquire about getting a refund because you found a cheaper company. Often, they'll "find" a discount for you to keep you as a customer.

 

[Sparafucile]

I've had New Jersey Manufacturers for over 20 years, and have been very happy with them and the rates. I've only made claims for my car being stolen (three times) but each time they were top-notch: fast rental car, their affiliated body shops are top-notch. Check them out.

 

[DunEdinRanger]

Try and get NJM - New Jersey Manufacturers.

...

According to my insurance friend here are a few of the reasons you pay so much for insurance in contrast with other states:

1. Demographics – With its 1,065 people per square mile, New Jersey is the most densely populated state in the nation. As a result, NJ has more registered motor vehicles per square mile (782) than any other state. Add to this New Jersey’s more than 34,000 miles of roads and highways. Note, for example that there were more than 250,000 reported accidents in 1998.

This is a statistic that raises the Non Sense flag. More People, More Cars, and More insurance payments coming in. Would you expect a state with the fewest cars to have the most accidents? Of course not.

6. Uninsured Drivers – There are an estimated 400,000 to 600,000 uninsured drivers on New Jersey’s roads and highways. When an uninsured driver causes an accident, he or she may be fined or penalized for driving without insurance, but it’s the insured driver’s insurance company that pays for the damage.

Again another statistic that raises a red flag, since you have to provide proof of insurance to register your car. Although when my dad's car was broadsided by a cab company, it wasn't insured.

 

[Wendy]

I was an insurance agent many years ago and we offered coverage in NJ. I will say anytime I had a customer call from there I wanted to run and play sick in the bathroom. NJ and NY are the absolute worst states for insurance. The rates are changed so often. High theft and fraud.

On your insurance you have carried for the last 6 months did you carry low liability limits? Having low limits and having a gap in coverage are the two highest rate factors I ever noticed with customers. We covered 48 states and that was the case in all of them. Many times if you carry minimum liability we would not insure if we did the cost was so high no one wanted to pay it. The reasoning is you are not being responsible enough if you are carrying minimum limits.

 

[_JP_]

If you are eligible, USAA is the only choice.

I totally agree.

Dad lives in New Jersey and pays almost twice as much for full coverage than I do for two vehicles here in Ohio. We both have USAA.