Old Blue

“There are worse things in life than death. Have you ever spent an evening with an insurance salesman?” – Woody Allen

When I was an 18-year-old soldier I went insurance shopping for the first time in my life. I’d just purchased a beautiful 76’ Dodge Ram for $3,000. It was lifted with 35” tires, a 454, & a Holly 4-barrell carb. This was about the most awesome rig a young man could ask for & with my measly soldiers’ paycheck of only $400/month, it was way more than I could reasonably afford. Given all of this, I wanted to make certain Old Blue (as she came to be called) was properly insured.

After a lot of calling around, I found a policy I could afford through a large, national insurance company. As time went on, vehicles changed, new drivers were added, homeowner’s insurance, life insurance, & umbrella insurance were added. For the next 20 years I called my local agent every time I needed to change or add policies. I just assumed I was getting a good deal for being a loyal, long-term customer.

Then my agent retired. I was handed off to a young, new agent who rubbed my wife the wrong way almost immediately. I switched to another local agent (of the same company) who fouled up the relationship even more. So, for the first time in 20 years, I went insurance shopping.

Can you guess what happened? … I ended up changing insurance companies & saving 40% on premiums for the same, exact coverage I always thought I’d been getting a good deal on.

Last week we talked about consolidating your business to make things easier on you & to save money. What we didn’t say is that you should just randomly pick someplace to do all your business. So, let’s talk about how you should actually go about consolidating your business & we’ll use insurance as an example.

First, make a list of all the major insurance carriers in your community. If there’s more than 1 agent, and there usually is, pick one that is near your home.

Make a list of drivers with date of birth & driver’s license numbers. Add vehicle makes & models. Write down your real estate address(es).

Now, download a Declarations Page from each of your personal insurance policies; vehicle insurance, homeowners insurance, umbrella insurance, life insurance, & so forth. Don’t include policies you obtain through work. It is nearly impossible to get a better deal on an individual insurance policy than you are getting through a group policy.

You don’t need the entire policy; just the Declarations Page. It probably even says “Declarations” right at the top of the page. This page tells every major aspect of your policy, including cost.

Submit a copy of your personal information & Declaration Pages to the insurance agents you selected with a request for a quote on all of your consolidated insurance business. Ask them to quote exactly what is on your Declarations Page so you can compare apple-to-apples. If you fax or email the information, always follow-up with a telephone call to make sure the request was received.

And don’t forget online insurers. If you are comfortable with e-commerce, call online insurers, like esurance & Progressive, the agent on the phone will tell you how to submit your information to them too.

And veterans, be sure to include USAA. USAA can often beat the socks off of other insurance company premiums.

If I was doing this right now in my community, I’d be obtaining quotes from Allstate, Eerie, esurance, Farmer’s, Progressive, State Farm, & USAA. That’s it; 7 companies. I don’t bother with independent agents who sell policies from 2nd, 3rd, & 4th tier insurers and neither should you.

You should hear back from every agent with 1 week. If you don’t, then write off that agent and insurance company.

Now look over the quotes & see who is going to give you the best deal. Once you’ve figured it out, and it only takes a few minutes, give them a call & start the process of consolidating your insurance business with your new agent.

It really is that easy.

My family saved close to $2,400/year on insurance premiums just by taking a little time to shop. This whole process took me about 2 hours, so on an hourly basis, I saved $1,200/hour. I don’t know about you, but anyone offering me $1,200/hour has my complete & undivided attention.

Personally, I’ve gotten in the habit of doing this every 5 years. I’m not going to jump ship for a handful of dollars in savings by doing this every year. I figure 5 years is enough time that I might find sufficient savings to make it worth my while to change insurers.

That’s all there is too it. I’ve worked with many customers to go through this simple process and in every case, my customers have found substantial savings. You could too, if you just take a couple of hours to look.

Sapiat Asset Management is an independent registered investment advisor, specializing in financial planning based, asset management for Gen X Individuals & Families, their Businesses, & the Trusts that benefit them.

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