You may think that your car insurance rates are too high. This may be because you haven’t done enough to find the best deals for yourself. Or your driving history and claim record is not good at all that you cannot qualify for large discounts. The fact is that rates have been stable for years now and it has actually gone down in some parts of the country. In California premiums are lower than their level at 1989.
This should tell you something about the competition in the market. It is so fierce that insurers are afraid to put up their prices. A few companies including the largest ones have been reporting losses last several years. This means that the cost of claims or too high for them to be profitable with the current premium levels. And yet they cannot still increase their prices.
If there weren’t enough competition they would have push up their prices by now and they would have passed the ever increasing costs of repairing automobiles and medical payments for injured people onto their policyholders. Several independent studies show that cost of repairing automobiles are always on the up. This is due to increasing wages, rents and shortage of skilled mechanics.
In the same way, hospital bills have been increasing steadily over the years. The treatment, surgery, rehabilitation and medicine costs are all up. On top of it, people are getting smarter every day and claiming and winning larger compensations from carriers. They can claim for all sorts of injuries these days. Also, they start claiming diminished value even after their automobiles are repaired properly on the grounds that being involved in an accident reduces the resale price of their vehicles.
And yet the premiums remain low all these times. Surely companies have been making improvements in their operations to remain lean and mean. The industry has been shedding workers for over two decades and moving some of their operations outside of the USA to countries with cheaper labor. They have been pushing customers to fill their quote forms online by themselves so that they can reduce the cost of call centers.
They have even been pushing towards online claim handling and procession. You can now fill your claims online and send documents by scanning and e-mailing. They have even been reducing claim handling costs by streamlining the process. They find it cheaper to pay the small claims quickly instead of appointing claims adjusters and increasing paperwork. These are all efforts so that they don’t have to raise their prices. And because of these efforts they can keep costs low.
As mentioned in the first paragraph if you are still paying higher premiums than your mate with similar age, driving background, zip code and claim history you are doing something wrong. Maybe it is time you find out where you go wrong and how your friend can get better vehicle insurance quotes. If it is too much efforts for you why not find a good independent broker who could search the whole of the market for you?