When it comes to comparing quotes for automobile insurance, most people focus on cost alone. They are concerned with where they can get the lowest price for a policy and often with just minimal coverage. That is to say, they tend to look for a policy that offers only what is required according to the law. That can be a grave error in judgement for a number of reasons.
Comparison Shopping May Mask Hidden Costs
While most consumers are working within a limited budget, there is something to be said for understanding the different choices you have when making a purchase. For example, product A may cost hundreds of dollars less than product B, but product A has a shorter lifespan and has had a number of issues that aren’t covered under a warranty. In a case like this, the costlier of the two products actually works out to be the more cost effective of the two and that’s something to always keep in mind when comparison shopping – even for auto insurance!
Take a Moment to Understand Insurance
To begin with, when shopping around for car insurance the first thing you should really do is understand what insurance is all about anyway. The purpose of automobile insurance is to safeguard you against the potential for extreme financial risk in the event of a serious accident or comprehensive loss due to an act of nature. You can stand to lose everything you own (and more besides!) if you are found to be at fault in an accident. This means that insurance is a way of mitigating risk to you or your business while giving over that risk to the insurance provider. Once you’ve bought a policy, you’ve given over the risk for financial loss to them. Keep that in mind!
Everything Comes at a Price
Then there is the fact that really, everything comes at a price. What are you willing to sacrifice just to get the lowest cost auto insurance available to you? What many consumers don’t stop to consider is the fact that while an international insurance company might have the same or slightly higher prices than a smaller insurance provider, the larger company has built a reputation for honoring their policies or they wouldn’t still be in business today. Therefore, an insurance policy written from State Farm Calgary would offer the same amount of trust as a policy written in any province or country where State Farm is licensed to provide insurance. When it comes to insurance, history and reputation are everything.
When you are looking to compare auto insurance between companies, it pays to understand that the cheapest policy isn’t always the cheapest policy! It sounds like a contradiction in terms, but by understanding that you are still going to be at risk if that provider isn’t reputable, why take the chance? You can still keep your insurance affordable, but are a few extra pennies worth the risk when choosing a company that doesn’t honour their policies? You be the judge.