Oh boy. The comparison. We get this call all the time. People asking why they should be paying more then their neighbor/friend/co-worker/butcher, dog walker, etc. It's a valid question. As agents, we like to educate our clients so you understand why your rate is what it is. So, let me explain.
No two people are exactly alike, well maybe in the case of twins. Comparing your insurance, regardless of line of business - commercial, personal auto, homeowners, or even life insurance is never going to give you the same rates, unless all factors are EXACTLY the same. Are they? Let's take a deeper look.
Here are a just a few questions to think about when you and your friends/relatives/neighbors/butchers/barbers, etc. start talking (which we highly encourage) about insurance and trying to compare your rates.
Age - are you the exact age as the person you are comparing your rates to? Down to month, date and year.
Driving Record - Do they have the exact driving record as you do? Tickets? Violations? Exactly the same as yours?
Accidents - do they have the same amount of and exact type of accident, exact payout amounts as you? At fault and not at fault?
Territory - Do they live exactly where you live?
Credit - Do they have the exact same credit history as you do?
Are they the same sex as you are?
Do they have the exact make model and year of auto? With the exact same features?
Do they have the same amount of exact cars and drivers, same ages, etc as you?
Is their house the exact replica of yours, including furnace, roof, plumbing, etc?
These are just a very small portion of what is included when insurance rates are calculated. You cannot compare apples to apples to anyone else. We can compare apples to apples when it comes to one company rating your premiums to another company. This is because some companies put more weight say on credit then another company who might put more weight on territory. So those rates could vary. However, those rates are still based on YOUR individual information.
You will have a hard sell if you call me up and say you have a friend that can be compared EXACTLY to you and they are receiving a lower rate. There is going to be a reason they are receiving a lower rate. Let's say you both are 35, share a birthday even, male drivers, have a 2023 Chevy Equinox. You pay $135 a month for full coverage (also differences in what constitutes as full coverage but for argument sake, we'll say it's exactly the same), and your friend pays $90 a month. Perhaps you forgot about that speeding ticket you had 2 years ago - that's going to impact your rate. Or you have a youthful driver in home and he doesn't, that's going to change your rate. Does your elderly mom live with you? That's a change in rate.
Perhaps he lives 10 miles out of town and you live right in town - territory difference. That's going to change your rate. Maybe he has a credit score of 793 and yours is 702 - different rates. Maybe you commute 15 miles to work and he commutes 2, going to change your rate. Maybe his Equinox is an all wheel drive and yours isn't... different rate. Maybe his safety features include a back up camera and yours does not... different rate.
See where I'm going with this?
As much as we want to compare rates for you, it is impossible to compare those rates to another person's. There is just no way to say you have all the exact information lining up. Same goes on the commercial side. Two properties are not exactly the same, products or services are not exactly the same because the individuals offering those products or services are different. Your exposures are different. Your employees are different.
I know.. I know... how can we say they are different? And that leads into why we ask so many questions. The same questions we would ask that friend if they were to come to us. The answers are not going to be exactly the same as yours. As agents, we have to do our due diligence to make sure we are offering you the best rate we can by gathering this information.
So next time you are gathered at the water cooler discussing your insurance premiums, please do give them our name. We'll gladly offer a free quote. But we will not compare you to them. We will ask them the questions we need to rate their individual insurance needs.
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