The third thing you never knew about insurance:
3. The statistics in those commercials? Totally manipulated.
I’m sure you’ve seen claims like this: “customers save an average of $428 by switching to Company X”. It’s true that you can save a lot of money by switching insurance companies. But there are some big problems with the statistic.
- It only includes customers who switched. People only switch if they have an incentive to. So, it doesn’t include the people who would have paid more with Company X.
- It doesn’t say what the customers who switched were switched into. Were they switched into plans with lower coverages? Is the comparison based on coverages which Company X had the cheapest rates for? Were they given a temporary ‘teaser rate’ which will expire in two years? Every company can “save you money” this way.
- Every company targets a different demographic at a different time, and offers them lower rates, but not everybody else. That’s why every other company can make the same claims on TV as Company X does.
It takes a lot of research to find the company with the lowest rates for you. It helps to have an independent agent to do it for you!