Survey: Auto Insurance A Mystery To Consumers
NU Online News Service, Jan. 2, 11:14 a.m. EST? An insurer surveying auto owners has uncovered substantial ignorance concerning the factors influencing car insurance costs–including some consumers with the notion that a vehicle's paint job is a rating factor.
The survey by the Hartford Financial Services Group in Hartford, Conn., found for example that only one-third of adults responsible for making auto insurance buying decisions are aware that safety devices have a significant impact on their insurance costs.
In the survey, 879 adults responsible for auto insurance purchasing decisions were asked to rate factors they thought had the greatest influence on insurance costs. The study also asked participants to describe what actions they had taken to get the most from their premium payments.
"Unfortunately, people don't always know what they can do to influence their premium, and sometimes they are misinformed," said George Thacker, senior vice president of personal insurance marketing at The Hartford.
Eleven percent of survey respondents said they had avoided purchasing a red or yellow car to save on insurance, when, in fact, color has no bearing on premiums, Mr. Thacker said.
The survey also found that some policyholders don't always follow through on what they correctly know will help reduce insurance costs, while others end up taking actions that they know will have little impact on premiums.
The following is a summary of other main findings in the survey:
? More than 80 percent of respondents correctly believed that maintaining a good driving record has a positive impact on insurance costs and said they have maintained a clean record to lower premiums.
? Respondents chose raising the deductible as having a big impact on insurance costs. Raising the deductible is, in fact, a good way to lower premiums. Increasing the deductible from $200 to $500, for example, could reduce the collision and comprehensive coverage cost by 15 percent to 30 percent, according to the Insurance Information Institute in New York. But only about 40 percent actually do choose higher deductibles, the survey found.
? More than half of those surveyed correctly believed that insuring homes and automobiles with the same insurer would significantly lower premiums. But nearly two out of five respondents didn't use a single company to insure both.
? Safety features such as anti-lock brakes, air bags and anti-theft devices often lower insurance costs, yet only one in three respondents believed that reporting such safety features to their insurer will have an impact on their premiums. But interestingly, nearly three-quarters of respondents said they have nonetheless told their insurers that they have these safety devices.
? Only one-quarter of the respondents knew that eliminating collision coverage on older cars can reduce premiums.
? Only one in eight respondents knew that taking drivers' education reduces insurance premiums.
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