Lower car insurance in four step process

car dashboard

There are four steps to lowering auto rates by getting no down payment car insurance when it comes to get instant auto insurance no down payment with the best reasonable auto insurance rate.

Reading this article is the first step to being on your way. The reason you are on the first step may or may not be your fault. Here are some examples why:

  1. You are with a non-standard insurer
    2. You had no prior insurance
    3. You have three or more moving violations in the last three years
    4. You have two or more chargeable accidents
    5. An agent put you with a company with high rates
    6. The policy you had canceled for non-payment
    7. You have really bad credit
    8. The area you live in only have non-standard companies or assign risk
    9. A standard insurer turned you down,
    10. You are in the state assign risk plan
  2. How Do you know you are on the First Step with a Non-Standard Company? First, you must find out if your company is a non-standard company. Ask your agent, if they do not know then call your state insurance department.

How Do You Know if you are With an Assigned Risk Plan?

Look at your auto insurance application. At the top of the application, it should indicate if you are with an assigned risk plan. Assign risk is sometimes called, for example, the Michigan Assign Risk Plan. You can substitute the name of your state for Texas.

Is It Bad to be With a Non-Standard Company or Assign Risk? Not necessarily. Non-standard companies and assign risk to serve a purpose for certain types of drivers. The question is you that certain type of driver? Do you fit in one of the 10 reasons mentioned above? If yes, then maybe you do belong with a non-standard insurer or assign risk.

Do You Need to Stay with a Non-Standard Insurer or Assign Risk? The answer is No. No one needs to stay on step one forever. The minimum number of years to be at step one is 6 months to 3 years. The reason it takes up to 3 years for accidents and moving violations to drop off. The final question is:

Can You Be on Step One with a Standard Company?

The answer is a yes and no answer. Let’s explain it. Some of the largest auto insurers in the country have subsidiary auto companies under their corporate umbrella. Some of those companies may be non-standard and some might be standard.
For example, Young America has four auto insurance companies under its banner.

Young America Auto Insurance Company, Loyola Insurance Company, Rodney D Young Auto Insurance Company and Loya insurance company.

When you come into YAI Agency, the agent will place you into one of the four companies based on certain criteria. These criteria are called underwriting guidelines. The agent to determine which company you will fit into uses these underwriting guidelines. Your driving record, claims history, insurance scoring, and other information will determine your placement.

In this example, Young America Insurance is the non-standard company. Young America Insurance Company of America will place any driver without prior insurance into this company regardless of their driving record, credit scoring, and claims history. After six months or a year, the company or agent can upgrade you to another one of their companies, like Rodney D Young Auto Insurance. Young America Insurance is the standard company for Young America Auto Insurance Company of America. This company has lower rates and more benefits like a 10% rate decrease after one year of a good driving record, you can also ask for car insurance first month free no deposit and $20 down payment car insurance.

This example is very close to the way many large auto insurance companies operate

Do not assume because you are with a “big auto insurance company” that you are getting their best rates. Ask the agent if you are in the best “tier” for their company with the lowest rates and additional benefits.

You can compare this type of system to the various types of checking accounts that a bank would offer. For example, the low balance depositor does not get free checking. For the depositor with a $10,000 balance, they get free checking and many other “free” perks along with it. Young America Insurance uses a similar system.

The excellent drivers are placed with one company and the fair drivers with another company, all under the same umbrella. Before you leave Step One, there are a few things you need to do.
1. Increase your limits of liability. This will possibly give you a cheaper rate. Remember. Remember; change your limits at least two months before renewal.
2. Check your credit rating.
3. Use the auto questionnaire when shopping around.
4. Know, which companies are standard.
5. Make sure you are ready to budget your auto insurance payments.

  • Going from step one to step two could only be a six-month process for the average driver. Step two should lower your rates and get some additional benefits. *Step two should be with a standard company. But depending on your driving record, claims history, and credit rating, you might still be with a non-standard company but on step two with lower rates.

If you did not have prior insurance, step two should offer a good decrease in your premium. Some independent agents and brokers have many different auto insurance companies they do business with. Do not be afraid to ask them every six months if they have a company with better rates. Independent agents and brokers contract with new companies all the time. If the agency is really big, it might take a few months before the agent can contact you about a company with lower rates. Remember all agents do not want you to have lower rates. To some agents, lower rates mean lower commissions. All companies do not pay the same level of commissions. Keep this in mind.

If you have changed your agency or company by going to step two, have your policy reviewed by your attorney. Sometimes agents or companies might change or decrease your coverage when you switch. Make sure that you have the coverage you want before you cancel your prior policy.

Never cancel your previous policy until the step 2 agent or company has checked you driving record, credit scoring, claims history, and other information. Also, make sure they do the same thing for everyone on your policy.

That means your spouse, children, or other family members. Some clients change companies and received a really good rate. A month later the company is going to cancel the policy because of her husband’s suspended license.

By this time her previous policy had been canceled. On top of that, she lost her prior insurance discount because she did not have 6 months of continuous coverage (she had a 2-week break between the companies). Luckily, she did not have to start over.

  • This might be your final destination to obtain affordable rates. Once you are placed with a standard company in step 2, you can switch to another standard company, let’s say Citizens insurance, for example. What most people do not understand is that standard companies will give you a better rate if you are transferring from one standard company to another standard company. For example, we have three companies, Standard Company A, Standard Company B, and Non-Standard Company C. If you transfer from Non-Standard Company C to Standard Company A, the premium is $1,200 a year. But if you transfer from Standard Company A to Standard Company B, the premium is $850 a year. Non-Standard Company C >>Standard Company A = $1,000 Standard Company A >> Standard Company B = $850.

Many standard companies have a list of all companies that are classified as non-standard

When you tell the agent or company what auto insurance company you are transferring from, they will determine if your present company is standard or non-standard and will charge you the appropriate premium. Clients sometimes say, “My neighbor pays less for their auto insurance. We have the same type of car. We are about the same age, and we both have the same driving record”. Sometimes the difference is what company you had before you went to the standard company. Three people can be with the same company for years with all underwriting criteria the same and have different premiums.

Driver #1 Charles came to Standard Company A with no prior insurance.
Driver #2 John came to Standard Company A with prior insurance from a non-standard insurance company.
Driver #3, Matthew, came to Standard Company A with prior insurance from a standard company.

These differences can add up to hundreds of dollars a year in some parts of the country.
Now you have reached Step 3 by way of a standard company and utilizing all the other strategies. You might have come to the point of obtaining the best rates in your area. Once you get to a company with the lowest rate, the next theory is from a favorite song of mine “What I’ve Done for Me Lately,” which is Step 4.

  • Now that you have the lowest rates, you can now look for a company that offers no down payment auto insurance for the same rates or lower, but maybe a better policy. An example could be your present company offers $20.00 a day for car rental. Another company with the same rates offers $30.00 a day and road service for non-accidents. twenty dollars a day does no goes very far if you ever had to rent a car, minivan or SUV because of an accident.

Realize that you may be a great asset to an agency or company if you are a client with a standard company. It’s your advantage to see how far a company or agency will go to keep your business. In order for you to determine your value to the agency or company, you need to know your assets. Below is a list of some of your assets:

  1. First, it is important that you pay your premiums on time. Good client’s equal renewals and bonuses.
  2. Have your homeowners or life insurance with the same agency or company.
  3. Have an impeccable driving record, claims history, and credit scoring. Low loss ratio to an agency or company means bonuses.
  4. Sign up your family and friends with the same insurance agency. Because of your referrals, the agency can now save on advertisement.
  5. Since you are a client who is courteous, never complains, and mail your payments or use electronic funds transfer, low servicing is required for you. The agency or company will not want to lose your business. Not only they will lose your business, but the business of friends and family you referred.
  6. You have multiple vehicles and have a large premium. Which means the agent or broker earns a big commission from you.

Staying with the same agency or company when you have some or all of these assets should mean additional benefits. There are many companies that do reward their good and loyal customers. It doesn’t mean just a birthday card and a calendar.

The following are some benefits and perks you might receive from an agency or company that appreciates your business:

  1. After one year of having a clean driving record, the company gives you a good driver’s discount of about 10% and up off your premium.
  1. After 4-5 years of a clean driving record, the company forgives your first chargeable accident or moving violation.
  2. The company offers a fee road service.
  3. The agent offers free planning services in the areas of retirement and education.
  1. The agent or company sends you a free periodical newsletter.
  1. The agent gives you free notary and faxing services.
  2. The agent or company gives leniency for late payment.
  1. The Payback benefit that was part of your first-year premium is refunded if you have been claims free for 4-5 years.
  2. Always remember that the agency and company need you and your family’s business to survive. Sometimes you are not in a bargaining position because of your driving record or claims history. That is why you have to know all your assets. An agent might reconsider canceling your auto policy for late payments if you referred 30 church members to their agency in the last year.
  3. Replacement with a new car if your vehicle is stolen or totaled.
  1. Agreed value. The company agrees to pay you a pre-agreed value for your vehicle.
  1. Disability/Long Term Care. The company give you money for someone doing your shopping or other duties in or out of your home because of your injuries.
  2. 100% Glass replacement. The company will be reimbursed for glass breakage to your vehicle with no deductible.

The four-step process may take anywhere from a year to possibly five years, depending on your situation. The bottom-line if you have high rates start right now to lower them. You do not have to wait for your policy to renew. Just make sure you cancel your policy correctly.