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 Posted: Sat Feb 21, 2009 6:30 pm Post subject: 3 cars, 2 parents, 1 teenager |
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Cars #1 (newest) and #3 (oldest) are on my wife's insurance, #2 on mine. We are trying to figure out what is the most economical way to add our teenager. Whose policy should he use? He is going to drive the oldest car, but occasionally #2 too. He won't drive the newest one.
Versions:
1. He gets his own insurance on #3. and he could be added to ours as secondary driver with no cost if I understand correctly.
2. He is added to mine as secondary driver on #2, but guess he has to be added/listed on my wife's policy although might not be for extra.
3. He is added to my wife's on #3 and excluded from driving #1.
Again,he probably will drive both #2 and #3, but not #1... |
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Pedroforo
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| Posted: Tue Feb 24, 2009 10:58 am Post subject: |
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IMO the teenager should be added to the parent's policy since its more cost effective. You should ask the agent to present his quote with the above mentioned three options, then compare the cost of the each coverage and select. Groundnut
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groundnut
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| Posted: Wed Feb 25, 2009 6:17 pm Post subject: |
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| Usually going on a parents auto insurance is a lot cheaper way to go. The teeneger would pay alot higher insurance if he was to have the vehicle in his or her name and get their own insurance. An agent should be able to sit down with you and work out the best direction to go. |
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fireyone
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| Posted: Fri Feb 27, 2009 11:26 pm Post subject: |
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Pedroforo,
I am confused about why you and your wife have separate policies. Since you are married, you would be better protected and pay less by combinging them. With a teenager being added to the policy(ies), it will be even more cost-effective to add him if you have only one policy that covers all three cars.
If you continue to have two different policies, and he drives a car from each policy, he will need to be added to both policies. If you add him only to one of the policies, but he regularly operates a vehicle on the other policy, you risk not having coverage if he has an accident.
Putting him on his own policy will usually cost the most. This is because he will not have a discount for good credit, for multiple cars, or for owning a home. In addition, most companies will rate him in a higher program because he does not have prior insurance. Keeping him on your own policy will ensure that he gets all of these discounts, the same as you do.
The cost of adding him varies from company to company, but in most cases you will see a significant increase. Some companies charge less if he is added as an occasional operator. Some will automatically rate him on the most expensive car. Others average all of the drivers together, and charge that average rate to all the cars. Your agent can run your scenarios through the company rating software and determine which is more cost-effective for you.
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Christy P.
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ChristyP
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| Posted: Sat Feb 28, 2009 6:53 am Post subject: |
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| Quote: | | Some companies charge less if he is added as an occasional operator. Some will automatically rate him on the most expensive car. |
Why would he be charged for the most expensive car? Would it happen the same way if the parents strictly mention that the boy isn't going to drive the expensive and new car?
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bandit-baby
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| Posted: Sat Feb 28, 2009 2:40 pm Post subject: |
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| Quote: | | Why would he be charged for the most expensive car? Would it happen the same way if the parents strictly mention that the boy isn't going to drive the expensive and new car? |
It depends on the company's rating formula. Each company makes its own formulas based on their data, and they file them with the state for approval. Once approved, the company is required to follow that formula on every policy. They must be consistent and objective with everybody, and they cannot use judgement.
There are many different ways to decide how to rate drivers on cars, but the three most common are:
1. "Assigned driver." The policyholder (you) tells the company which driver drives which car, and the company rates it accordingly. (Allstate is an example of this type of rating in most states.)
2. "Average driver." The company averages all the drivers together, and applies this average factor to all cars. This means that there is no assignment of drivers, and the rate will be the same regardless of who drives which car. (Progressive is an example of this type of rating in most states. More companies are adopting this method now than a few years ago.)
3. "Highest-to-highest." The company takes the highest-rated driver and rates him or her on the highest-rated car. Then the company rates the second-highest-rated driver on the second-highest-rated car, and so on, until all drivers are assigned to cars. Again, it does not matter which car you say he drives, since the company will rate him on the highest car anyway. (This is less common than it was about 15 years ago, but it is still used by some of the high-risk companies.)
There are also some other methods, but these are the most common. This is one of the things that makes rates vary so much from company to company. Talk to you agent to see how your company does it. If your company does it in a way that does not work for you, consider changing companies. If your agent cannot answer your questions and help you the way you need, then consider changing agents. After all, this is YOUR insurance!
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ChristyP
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| Posted: Sat Feb 28, 2009 5:51 pm Post subject: |
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I agree with Christy! You should combine your policies and put all three of you on one.
Have you ever head of the company IDA? They'll help you set up a CDRP (Collision Deductible Reserve Plan.) With that you'd be able to safely raise your deductible (so you could save on monthly premiums) and it would cover all three cars and all three drivers.
It's a really good plan for households with multiple cars - and EXTRA good for households with teenage drivers.
You only have to set up one account and even if you, your wife, and/or your son are ALL in accidents in the SAME month you'll be covered for ALL THREE deductibles!
It's really is an ingenious idea - wish I'd thought of it 
If you want to know more check out this site: mycdrpsavings.com/idaleader |
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AnnaRaC
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| Posted: Sat Feb 28, 2009 6:55 pm Post subject: |
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OP, all carriers are a little different, but if it were me (and I did do this when our kids started driving)...rate him as the operator on the cheapest vehicle if possible and it makes sense, do not carrier collision and comp, only the manditory coverages, but with higher limits...
anna honey, you need to becareful promoting your own business or company you work for in threads, it's perfectly fine to put it all in your signature, plz feel free to send me a pm with any questions...
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Lori
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| Posted: Sat Feb 28, 2009 7:18 pm Post subject: Sorry Lori |
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I don't work for the company, I just heard about it and thought it was cool.
I didn't know that there was anything wrong with sharing things I've learned recently and think might benefit other people.
But I am pretty new to this whole forum thing. I'll be more careful - but I still think it's good advise!
I haven't set up a CDRP yet, but I plan to because I think it will be good for me, and my family. And I'm sure it would be a good fit for others on this forum as well. |
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AnnaRaC
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| Posted: Sat Feb 28, 2009 7:30 pm Post subject: |
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Sorry Anna, but always looks 'fishy' when someone has three posts and mentions 'a' company in all of them..i sent a response to your pm...i disagree this is a good product...for many many reasons...if you want to take this back to the thread that 'ryan' who is clearly (per the website) a rep for this company we can discuss it further.
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Lori
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| Posted: Sat Feb 28, 2009 10:29 pm Post subject: |
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| It really upsets me when companies do this. I can not put trust into a company that comes and posts under false pretenses. If they can not be straight forward here then who would want there service. I still do not get why a person would need a companylike this to begin with. Seems a whole lot more simple just to go down town and open up a savings account or keep the deductible with in your own reach in case you need it. |
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fireyone
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| Posted: Sat Feb 28, 2009 10:47 pm Post subject: |
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Firey,
I agree with your sentiments. I do not know anything this other company, and I am not posting about it--just posting about the concept of raising your deductible and saving the money yourself.
I have a number of policyholders who have made the decision to raise their deductible and save the money for a future deductible payment. In some cases, I even have people who choose to forego physical damage coverage entirely and save the money in an account to buy a new car. This is the same concept as "Buy term and invest the rest" in life insurance. Unfortunately, it is easier to say than to do. The discipline is the hard part, whether saving for a deductible or saving for investment. I think that very few people actually set up that savings plan.
When I was a product manager for one of the big name-brand companies, one of my agents begged us to set up an automatic savings plan. After all, the company owned its own bank. He wanted us to include an automatic deduction of $25 each month, on the same draft as the regular insurance premium bill, and deposit that $25 into a savings account at our bank. Doing it on the same bill was the key to making it simple and easy. I loved the idea, but we were not able to get the priority on it to allocate systems resources.
That being said, would it really be that hard to do it separately? Now I am an agent for a different big name-brand company, and the company owns its own bank. I haven't done anything with the bank because I am in the insurance business, not the banking business; but maybe I should offer these people a separate savings account for the sole purpose of putting aside money for that deductible. I wonder whether that would add value in people's minds?
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ChristyP
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| Posted: Sun Mar 01, 2009 3:19 am Post subject: |
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| Christy sorry if you mistook my post. I was just talking about those who post question and are actually trying to promote their site. I would rather have a straight forward conversation with all cards laid on the table. I agree with you on how it can be hard to discipline yourself on putting money back. It is something though we all need to do. Anymore it seems like the roadways are filled with wackos, people tending to phone calls, or do not believe they need to use headlights or turn siganls. We jsut need to be prepared. I would not mind if my car insurance had the option of setting aside money in an account that could be used for deductible purposes. Plenty of people may even take advantage of something like this..especially those who do not put money aside and leave it there. |
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fireyone
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| Posted: Sun Mar 01, 2009 3:34 am Post subject: |
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| Quote: | | Anymore it seems like the roadways are filled with wackos, people tending to phone calls, or do not believe they need to use headlights or turn siganls. |
Oh, yeah, that was me. I couldn't turn on the lights while I was driving, because I was on the phone with my bank setting up a plan to set aside money each month to cover my deductible ... 
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Christy P.
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ChristyP
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| Posted: Sun Mar 01, 2009 12:45 pm Post subject: |
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| Quote: | | just posting about the concept of raising your deductible and saving the money yourself |
Christy, I totally agree with this, and have preached and advocated this for years the savings (usually) are significant... | Quote: | | I wonder whether that would add value in people's minds? |
I think it could and makes perfect sense to me for an ins carrier to marry this type of plan to their p&c sales...but then again, carriers are in the buisness of making more not less premium (higher deductible=less premium)...maybe that was the problem with your other employer? | Quote: | | was just talking about those who post question and are actually trying to promote their site. I would rather have a straight forward conversation with all cards laid on the table. |
Fire I could not agree more...
I'm in total agreement that a plan to assist with savings for deductibles (including health) are a great idea in theory...I however I do have reservations about some plans (this one in particular or right now anyway)..just 'one' problem i have with it is it covers collision only not comp...so the insured can only raise their collision not comp deductible, cutting their savings minimally in half...coll and comp run pretty closely premium wise....I'm going to try and keep the discussion on 'that' product on the other thread....(little help too ok?)
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Lori
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