The Problem with Your Auto Insurance Policy

And the problem isn’t that your Auto Insurance is too expensive.

If you have a car, you have auto insurance.  It’s the law.  But, odds are you are completely unaware about a big problem with your auto insurance.

Now, most people probably assume that the problem is the cost.  The thing we hear the most is that people feel that they are overcharged for what they have, or at worst, “ripped off.”

But that isn’t the real issue.  And, I’m going to be honest with you, the rest of this article may not be popular with some people.

But we pride ourselves on honesty, whether it is what someone wants to hear or not.  We tell people that they DON’T need an insurance policy or a particular coverage rather than selling them something that they don’t need.

And it’s in that same spirit of candor that I say what I’m about to say.

So buckle up.

You are buying auto insurance like you buy a toaster.

Toaster, not auto insurance.

What?  What does that mean?

If you are buying a toaster, and you have only two things to think about: how many slices of toast can it handle at once, and how much does it cost?

For most of us, the number of slices and the sound it makes when it is finished toasting are exactly where the phrase bells and whistles comes from.  It’s all fluff.

So ultimately it’s all about price.

We want the cheapest toaster.  We want a toaster on sale.  And we want it free if we can get it – even if we have to start a new checking account.*

*For young people, banks used to give toasters as a freebie for starting a checking account back in the olden days before Instagram and banking apps and Lizzo

And we think about insurance the same way.

We want CHEAP insurance.  We want DISCOUNTS.  We want to SAVE MONEY.

Now a part of you is going, “Of course we do!  I need to save as much as possible.  Why would I pay more for something if I don’t have to?”

And you’re right.  Overpaying is financially irresponsible.  But here is the point I’m making.

Insurance is not a toaster.

Ford Mustang with racing stripe.

On the surface that’s obvious.

But the fact of the matter is that most people don’t think about insurance as all that different than a toaster.  They want to know what it costs.  It’s the first question we get.

When we ask what their driving record is, or what kind of car they have, some people are annoyed that we can’t just tell them what the price is.  Isn’t all that just bells and whistles?

Coverage options are just how many slices of bread it can make at once, right?


Insurance is not a toaster.

It is a financial reimbursement device.  What does that mean?  Insurance is a financial service that pays you back when something happens, something that costs you money.

So how can we think of insurance that can help us understand the difference between insurance and a toaster?

Look at it this way.

Insurance is like a home security system.

Phone with home security system.

That’s a little different, isn’t it?

Buying a home security system isn’t just going down to your local Best Buy* and picking up a camera that goes over your door.

*For young people, in order to buy something you used to have to go to stores to buy something in person.  See: Blockbuster.

Security systems have different levels of security.  If you just want the cheapest option available, there are still numerous places in your house that are at risk.

But, for the top level, elite protection, you have to pay more.

And it changes depending on the house.  If you have a small house with only a few entrances, it will be less expensive to protect.

But a large, sprawling mansion could require dozens of points of protection in order to keep you absolutely secure.

Do you see where I’m going with this?

Insurance is a tailor-made product designed for each customer.

Suit of armor.

There is no one size fits all for a certain price when it comes to auto insurance.

As consumers, we have been TAUGHT to buy based on price.  GEICO and State Farm have told us that cheaper is better, that discounts and deals are the way we should find value in insurance.

But look at this – I can lower your liability from 100/300 to 50/100 (check out our Ultimate Guide to Auto Insurance to find out what this means) and yeah, you’ll save money.

But if I took away half of a meal you ordered and charged you less, would you be satisfied?

This gets to the heart of what I’m saying.  People typically just look at the price.  So an agent or company that only wants to get your business, not do what is best for you as a person, can “save” you money by giving you a fraction of what your old policy used to be.

An old customer of ours said we “ripped them off” because we charged a hundred dollars more than her new company.  But we don’t sell anything lower than 50/100 limits for insurance.  Period.

I’d love to see their new policy and compare to what we had for them.  It’s what’s inside the policy that counts.  As we say at Alliance, we don’t mind getting beat on an “apples to apples” basis.

But we don’t like it when someone goes somewhere and buys less insurance and thinks they are saving money.

When we do an auto insurance quote, we look at your driving history, your vehicle type, the drivers you have, and consider what risks there are out there in the world that you have to deal with – the “how many doors” scenario from our home security system metaphor.

Then we offer you a policy based on what is best for YOU.  Not what is best for GEICO.  Not what is the cheapest.  What is the BEST.

Auto Insurance should be personalized.

If your auto insurance policy looks like your neighbors’, something is wrong. Unless your neighbor is your twin sibling with identical vehicles, identical credit scores and identical driving records.

Minimum limit, cheapest-is-best insurance just doesn’t cut it anymore.

I can even use full coverage to prove my point.

If you have a four year old car that is paid off, having only liability is crazy.  You would owe a ton of money to fix your car if you get into an at-fault accident.

BUT – if you have a 17 year old truck that you drive around to haul things or go fishing in, having full coverage is a waste of money!

We advise people all the time to drop full coverage on vehicles over 15 years old because the cost of repairing the vehicle isn’t worth the value of the car.*

*And no, I’m not talking about a vintage car or a 15 year old Lambo.  Nobody likes a smart aleck.

It’s time to treat your auto insurance like a parachute.

Nobody wants to jump off a plane with the cheapest, rat-chewed parachute they could find.

If you have a policy that you bought because it was the least expensive one, you need a new quote.

Right now.

Click on the link below, get a new quote, and talk to someone at Alliance.

We do everything on an individual basis so that each individual is properly covered.

And if you want minimum limits or you want to cut a big coverage item because it’s cheaper, we will say no.

Life is too important to lie to your clients and not look after their own best interests just to make a little money.

So get into a new way of looking at things.  Get a new quote, and make sure you can jump off of a plane with confidence.

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