Consumer expert: Loyalty to auto insurers costs drivers thousands

Loyalty to an auto insurance provider often costs drivers more money than it saves.

Kevin Brasler, editor of Washington Consumers’ Checkbook, said the most effective way to reduce auto insurance premiums is to shop around for new policies every few years. He noted that many policyholders save between $500 and $1,000 on their home and auto bills simply by comparing rates with different companies.

Brasler explained that drivers often believe staying with the same insurer for years without filing claims earns them a reward. That assumption is incorrect because insurance companies share claims data. Competitors know a driver has a clean history and are likely to offer a steep discount to win that business. Those new providers are happy to peel customers away from their current insurer by offering rates significantly lower than what the driver is currently paying.

The expert provided additional strategies for lowering costs. He recommended maintaining the highest deductible amount that a driver can comfortably afford. Drivers should also consider dropping collision and comprehensive coverage once their vehicle's value falls below $5,000.

Liability limits are another area where savings can be found. Brasler advised checking the cost to raise limits beyond standard coverages. Increasing liability limits above standard amounts is usually inexpensive. Drivers should ensure their coverage does not lapse for any period of time. A gap in coverage can be used against them in future rate calculations.

The advice comes as consumers look for ways to manage household budgets. Brasler emphasized that the act of shopping for insurance is a direct financial benefit. It forces the market to compete for the driver's business rather than assuming the driver will remain passive.

Drivers in Clark County can apply these steps during their next policy renewal. The primary action required is contacting multiple insurers to request quotes. The shared data between companies means the new provider will likely offer a competitive rate based on the driver's existing record.