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The NY Car Insurance Cost Versus Protection Dilemma

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Insurance agent shaking hands with car insurance customer
Learn how to overcome the Cost versus Protection Dilemma you may face when getting an auto insurance quote.

A car insurance policy is not a tangible item that has beauty or holds intrinsic value. In fact, a lot of people often view it as a commodity where an auto policy at Insurer ABC is the Identical to Insurer X, Y, or Z. Unfortunately, this is not the case as it pertains to car insurance and there are often large differences between insurers and agencies regarding pricing, coverages, and customer service.

When we prepare quotes for potential new customers, we do our best to mirror their same current coverages to determine whether we can offer a savings benefit with all things being equal. If we feel that the insured may be under-protected or have gaps in coverage, we also provide a quote with coverage limits that give adequate protection based on our experience.

Oftentimes, we are able to provide a nice savings benefit with the equal quote comparison, yet the insured is hesitant to go with the increased protection that we recommend, even though they are at the risk of exposing themselves to significant financial pain in the event of a car accident where they are determined to be at fault and someone suffers a significant injury.

It’s one of the more difficult parts of our job as insurance professionals to experience someone putting themselves at such risk for how little it costs to raise limits and add protections that properly cover them. It’s far too often that even with the added coverage we can offer significantly lower premiums and the insured still declines.

As to the risk of carrying inadequate liability limits, lets take a look at the following example.

You’re driving along a highway and avert your attention for just a moment to adjust the climate control in your vehicle. At the same instant, traffic suddenly comes to a stop and you hit the car in front of you. Unfortunately, the driver of that vehicle suffers a serious injury and the next thing you know, has filed a claim with your insurance company for $500,000.  The injury is real and $500,000 is a common amount  of reimbursement for it.

You carry the New York State minimum required $25,000 per person/ $50,000 per accident (25/50) bodily injury liability limit on your policy. The question is, what do you do now?  Even if you carry 50/100, 100/300, or 250/500, how will this affect you financially?

If you have equity in your home, personal property, investments, cash/checking accounts, this puts you in a precarious financial position. Not to mention that your wages can be garnished as well. If you don’t have any assets, a large judgment can be issued against you hindering your ability to buy or sell a home, get a loan, get an apartment, or even get some jobs.

The reality is that accidents do happen, even to the most cautious of drivers.

Reprocessing the thought of car insurance from that of being a commodity to one of value and protection for you and your family is very wise indeed.

People work hard for the things that they have such as their home, savings, investments and belongings. To us, saving a few dollars a month on insurance is not even close to the importance of protecting yourself and the things you have worked so hard for in life.

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