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Choosing between an insurance broker or insurance company when you need to save on auto insurance

Updated on September 20, 2012

Do I really need insurance?

If you live in the United States, than you know that auto insurance is a must, whether you drive an old car or a new car, it’s mandatory to have auto insurance coverage. In fact a dealership will not release a car into your possession if you do not supply proof of auto insurance coverage. The same applies when you buy a home, the policy requirements vary from mortgage insurance, flood insurance, earthquake insurance and a long list of others. The fact is, there's no need to avoid insurance, we have to live with it and it gives us the sense of comfort we need to continue our daily lives.

Insurance is one of those requirements that once you’ve signed up for a policy, you continue to pay your monthly premium blindly and the only time you review it again is when you need new coverage. Most of us feel a sense of comfort and security when dealing with some of the large insurance companies direct. There’s really no clear explanation why most people choose those companies direct, it might be the unbelievable amount of money put into their marketing and advertising campaigns or just a friend’s referral. I personally have always chosen the large insurance companies for insurance coverage and cannot explain why.

My insurance coverage story

When we purchased a new home in 2008, I was referred to one of the most favored insurance agencies in Hayward, Northern California. I lived in Southern California, this was concerning because it would be difficult to just walk in and talk with somebody. To my surprise the process was quite easy, they had an online application for insurance quotes online and additional communications happened via fax or email. I was even more surprised to find out that my insurance policies are now $600 less every year. I have to say I was a little concerned because I hadn’t heard of the insurance company they signed me up with but with the expenses we had to face, the six hundred dollars’ saving was needed and quickly accepted.

Six months after purchasing our home, I received a phone call from the insurance broker notifying me that they recently added another insurance plan to their list of contracts and he would like to save me another $50 a month, I quickly accepted. I now had all my policies with one broker, with automatic payment every month and saving myself $650 per month, but my worries about how they will treat me during a claim never left my mind.

A year later, my husband had a small automobile accident and it was handled professionally and quickly, in fact even better than any other claims I had with the larger insurance companies because I could choose where to have the repairs done and not have to pay anything out of pocket. I am sure it’s not the same for everyone and every insurance policy is different, but I was quite satisfied and finally at ease.

Once a year, the insurance broker’s office contacts me and does an overall review of my policies they look to see if they can save me any money by switching coverage to another insurance company or any new program that might have been added. Every insurance broker is different, but this is what my Hayward insurance broker does for their clients as an added service.

Having experienced both sides of the spectrum, I believe that insurance brokers are the best way to purchase auto insurance, at least you are able to compare multiple insurance companies. If you decide to go with an insurance company direct, you will have to compare them one by one. Although an insurance broker might not be down the street from you, they are mostly small business owners that care about the pool of clients they have and the service they provide, not to mention proactive in providing you affordable quality insurance coverage whether it’s for your home, car, motorcycle or any other coverage you may need. I personally would always recommend finding an insurance broker rather than a direct insurance company when you need insurance coverage and save yourself money and time in comparing prices.

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