Purchasing and paying for insurance is a huge pain in the backside but it’s one of the prices we pay for freedom. In America we are free to make our own choices but most of our choices tend to be pretty stupid, so we need insurance as a backup. All in all the system works fairly well, but it’s still no fun shelling out money for premiums month after month.
But can you negotiate to get a cheaper insurance premium? It’s a very interesting question and it can potentially save you a ton of money.
The answer is, most definitely absolutely maybe!
Okay, that’s not really much of an answer but it’s a difficult question so bear with me. Technically, we live in a free market society and everything is negotiable including insurance. Of course insurance is based on actuary statistical data that is sometimes hard to argue against, so it really does depend.
Mainly, it will depend on the type of insurance you’re trying to negotiate over. Less intrinsically complicated insurances like automobile insurance may be easier to negotiate around.
Think about it, there are dozens if not hundreds of car insurance companies competing for your business, and switching your policy can be as simple as picking up the telephone or clicking a few keys on your keyboard over the Internet. Back in the olden days, before we had the Internet, it was much more difficult to change insurance companies, but these days it can be done in a matter of minutes, or less.
Insurance companies realize this and so you can very often negotiate down car insurance. Here’s what you do.
First, you absolutely must get all the facts. This means talking to a half a dozen or a dozen different insurance companies to get quotes. After you’ve talked to five or six companies you should have a pretty good idea of what the range of premiums is. If one company offers you $200 a quarter for liability insurance and another company offers you $400 a quarter and another company offers you $300 a quarter and on and on then you get an idea of the range; $200 to $400.
Now you can take this information to your current insurance company and simply tell them that you have a better offer from X company, and unless they beat that offer you will switch companies.
Be very exact. Tell them exactly what the offer is.
If you’ve got this information in front of you and your paying much more with your current insurance company, then the cards are stacked heavily in your favor. And anyway, if they don’t beat the offer you can simply switch companies. That’s one way to “negotiate”!
In the end, you have more power than you might think. People are often scared of big insurance companies, much like they’re scared of big banks. Once you get over that irrational fear and realize that the ball is in your court, then the possibilities are endless.