Being penalized for staying with the same (auto) insurance company too long?

Sometime next week, I intend on buying a 2014 Prius.

So I call my insurance guy whom I’ve been with for 9 years. I give him my information and he gives me a quote back at $177 a month!!

That’s outrageous! No accidents, no traffic violations. When I asked why it was so high, he told me because I was Grandfather’d in. Basically, they did a risk assessment when I joined 9 years ago. And I’m still being charged at that rate (When I signed up, I had a speeding ticket less than a year old.). And they can’t re-rate me because of company policy (All State).

That’s insane! So I called another company, and they quoted me at $89.
I just don’t get this. If I’m a loyal customer, shouldn’t AS want to keep me?

What you call “being a loyal customer” the insurance companies call “being too lazy/stupid to comparison shop.” I.e., this is a situation where you get penalized BECAUSE you’re a loyal customer.

This situation is common to all car/home insurance companies, across the board. They quote you a fairly low rate, to get you on board, and then over the years they raise your rates. You’ll save money overall by switching companies every 7-10 years.

Agree with Flyer except we find that it’s usually much lower than 7-10 years.

If they charge too much (and they will if you’ve been with them a bit), just switch.

Many companies offer ‘introductory rates’, even if they’re not advertised as such, they’re lower than they should be to get your business. And all of them raise your rates over the years. That $89/mo may be $120/mo in a few years, granted that’s still a lot lower than your current quote.

It’s another great reason to have a broker. Every few years I call mine up and ask her to shop around. Sometimes it’s not worth switch, sometimes I can save a ton of money switching.

I just recently experienced this as I was far too ignorant for too long to realize that my insurance company was fucking us over.

We’d been with Farmers for over 15 years and watched our rates steadily increase, but usually with a fairly big change: we added a renter’s policy, we moved to a different part of town, we replaced our old vehicles with newer but still used ones. A dollar or two increase every couple of months. Finally, back in April IIRC, our car rates jumped almost $15 / month yet nothing had changed. No new cars, no change of address, nothing. The bill was for $168 / month for two vehicles, liability only. Both my wife and I have spotless driving records, not a single ticket or accident between us. Yet they were raising our rates.

I called around, got some quotes, and we eventually decided to switch to Geico. We now pay $71 / month for the same coverage for the same vehicles. It kinda pissed me off as I liked having an actual agent that I could actually visit in person, but it wasn’t worth an extra $97 / month.

So I learned my lesson. Shop around, get some quotes, and you may find a cheaper rate.

I was with Pemco in Washington for 17 years when they started their campaign to drive me away by jacking me up 20 percent a year, adding a 40 buck just because fee, and finally penalizing me for paying for the entire year up front without changing my billing officially from 1/3 at a time to all at once.

Then they acted surprised when I called to cancel. Really???

Not everyone has access to USAA, but I’ve had them for a few decades without them playing games with my rates. And now I’ve hit the point in life where my rates are drifting down along with my presumed testosterone levels.

If you think about it from the insurance company’s side, its a good business idea.

Jack up everyone’s rates, those who don’t bother to shop around will re-up at the higher rate, which, if calculated correctly, covers the cost of all the people that switch.

Now the company has the same income with less customers to deal with.


And the cable and cell phone companies do it, too. Sign them up for the teaser rates and then after 6 months or a year, switch them over to the higher rates.

Newspapers and magazines do it too! They sign you up for a very reasonable rate with auto-renew service “for your convenience.” Then they auto-renew for 10x the new subscriber rate.

That was kinda the same bs I had with AmFam. Every few months the bill would go up a little, I’d call my agent he would tell me he’d look into it and get back to me. A few days later he’d tell me that everyone in the city/county/state just got that same increase. Personally, I never believed him, I’d think if every person in the area he serviced just got a new fee added to their premiums, he’d know about it, probably ahead of time.

Everytime I’d tell him it’s getting to expensive, the first thing he’d offer to do was reduce the coverage, but I never really liked the idea. I think the last straw was when I told complained that my bill was $2.00 per month higher, he kinda brushed it off as ‘only $2.00’, but then I mentioned that between this and the last two increases, I’m up over $10 a month (or $120 a year) just in the last few months.

I finally cut ties with him, called up a broker ended up saving something like $400 a year.
When those rates started to creep up, I called her back and she moved me to a new insurance company as well as splitting my bike off and putting it with progressive, it all worked out cheaper that way.
Both the companies I’ve been with were one’s I’d never even heard of before. Without her, I’d be calling Allstate or esurance or Progressive. She set me up with Travelers and Acuity, they’ve both been really easy to work with.

To some extent. If most competitors are following the model of enticing customers to switch with a loss-leading price in year 1, followed by steadily jacking rates, it may be quite difficult to compete using a model that seeks to retain customers long term.

However, Geico don’t seem to have been doing this to me since I joined them 6 years ago, and that’s worth something to me. I would not go through the hassle of switching unless the price difference were quite large. If Geico are not jerking me around on pricing, I feel the likelihood is greater that they would not jerk me around if I need to make a claim.

Had the same situation with travel insurance. Five overseas trips in the last two years with the same passengers, then went to sign up again for our most recent trip (same destination as the last one) and found the price had almost DOUBLED.

We’ve had no claims, no pre-existing health conditions of note, you’d think the company would have been screaming to keep us on the books, right? When I called them to query the price, they essentially said, “Tough Titties”…so I promptly signed up with another mob.

The absolute worse, IMO, is XM radio.
Every six months I have to call them up and threaten to cancel three times before they suddenly manage to find me a better deal. Usually around $30 for 6 months. That’s about $5/mo. Then I make a note on my calender for just a day or two short of six months to call them back and do it again, otherwise it goes from $5 per month up to $15.99/month.

And up until very recently their customer service was outsourced to, what sounded like, Vietnam. I don’t know where they are now, but at least I can understand them. It was very difficult before hand.

I truly believe that they’d have a lot more subscribers if they had reasonable rates and got rid of the bargaining thing. How about 8 or 10 dollars a month wouldn’t scare people off and the rest of us probably wouldn’t mind not having to call them up every few months.

On the other hand, I’ve been with State Farm like 35 years now, and have had few claims.
I also thought it was too expensive, and went to another place - where they told me that there was no way they could match the price I’m getting now because of loyalty discounts.

About 15 years ago, my insurance jumped about $800 a year. Nothing had changed, same vehicle, same address, same job/commute, no tickets. So I called all the insurance companies in the phone book and ended up with a rate just a bit lower than what I had been paying, and if I signed up for CAA for $65, I’d save an additional $120. Win - roadside assistance and save on insurance. I’ve been with them ever since. From time to time, I’ll get a quote from someone else - we were offered a special rate through my work, but nobody has beat their rates yet. And bonus, when I moved recently, my rates when down again.

If you qualify and are willing to do the boring AARP smart driver course, you can lower your rate by 5% in many states. I warn you, however, that it is sleep-inducing.

I switch from Progressive to GEICO every two years and back.

I’ve got the opposite problem. I’m “Grandfathered” into a special policy that is no longer offered (nor offered by any other company), which is not only dirt cheap, but essential to my whole phony operation.

If I ever lose it, I’m FUCKED!

I make two payments a year, and both fall on/near major holidays. :smack: Gotta make sure I mail early! :wink:

I’ve had exactly this experience with Geico - I added a new car about a year ago, and my rates doubled (which is rare, I have multiple vehicles and adding one doesn’t usually substantially increase it, and this car raised my total much more than a twice-as-expensive sports car I’d added in the past).

I shop around about every 2 years or so just to see, but always find that I’m better off staying. This time I was motivated, and went farther afield and looked at USAA and some other “these guys are always the best” insurance companies to see if this was just some aberration. But no, sure enough, everyone that quoted me was at least $100 higher per year with the new car added.

Geico has firmly captured me with their golden handcuffs. Although I might look into a broker, as some here have suggested - I’d love to farm out the whole “shop around” experience.

It’s pretty irritating that you can’t just enter your information and desired coverage into someplace online which would automatically pull real quotes from all the major insurance companies. It’s astonishing that this doesn’t exist, in fact, but that we have to use a human to do something a computer could do better and more comprehensively in 1/10,000 the time.

I’ve had good experience with State Farm for about ten years, too. No increases in rates. This was after fifteen years or so with Allstate during which my rates DOUBLED over time until I was fed up enough to shop around.

As for cell phones, my T-Mobile bill has shrunk continuously over time. At first, I was paying over $100/month for unlimited everything, now I’m down to $30.