As you may have read in my June 2013 Report, one of my goals for July was to switch car and home insurance providers to save an estimated $500+ a year.
Read on to see how much I was able to save with about two hours of work that included getting on-line quotes and speaking with insurance reps.
Money Saving Breakdown – The Quest to Save On Car and Home Insurance
- Difficulty (Super Easy/Easy/Medium/Hard/Expert): Medium
- Average Savings per Year ($/year): 475
- Time Required (mins): 120
- Savings for your time ($/hr): 237
Switch to Geico and Save 26%!
Could it really be this easy to save hundreds by switching from StateFarm to Geico as the commercials suggest? We’ve been with StateFarm insurance for about 15 years, and we always assumed we were getting a pretty good deal with them. Well, as I’ve come to find, you know what happens when you ass-ume…
Well, the online rate quotes for Geico.com showed that I could save ~26% (or $431) if I switched our car and home insurance to Geico . We have a 1997 Toyota Camry and a 2004 Toyota Sienna, and our home is insured for ~$300,000. The plan was to get comprehensive and collision on the Sienna and just the bare minimum on the Camry.
I spent a fair amount of time trying to decide if we should go with the higher deductible to save money or go with the same $250 for car and $1,000 for home deductibles that we had been using. After some great input from my wife, we decided to keep the deductibles where they were. Read why we made this choice here: Does High Deductible Car or Home Insurance Actually Save Money? This brought our calculated savings down a bit, but it was still going to be in the $400/year range. Great! Where do I sign up?
Home Insurance Rates Too Good to Be True?
I called up Geico and registered for car insurance. It was easy and the process took about 10 minutes. The rep then transferred me over to the home insurance division. After a series of questions, it became apparent that I would be charged a much higher rate for the home insurance than I was quoted on the Geico website (see the table below). The problem was, I used the same amount of home coverage as I had with StateFarm. Apparently per Geico’s calculations (this also matches up with Nationwide and Progressive), I needed ~$175,000 more insurance coverage to completely cover rebuilding the home based on the square footage. Great! We’ve had our home under-insured with StateFarm for the past ~2 years, and they’re charging us and arm and a leg for it! After Geico re-ran the numbers, it turned out that I’d only be saving ~$173 per year if we made the switch. That’s pretty good, but not good enough for MoneyAhoy! After thinking it over for a couple of hours, I called back Geico and canceled my car insurance (sticking with StateFarm until I could find a better deal).
Plan B: How Did I Save on Car and Home Insurance
I shopped around with a couple other insurance carriers and actually ended up with the best rates (by far) from Progressive (see the table below). Their phone rate matched their on-line rate, and I was setup with my new car and home insurance in about 27 minutes of phone time. I was able to save a total of $474.82 a year, keep the exact same auto coverage, and increase our home coverage from $300,000 to $475,000 so that we’d be properly insured if our home experienced major damage. Not too shabby!
|StateFarm||Geico – Online||Geico – Phone||Nationwide||Progressive|
|TOTAL (annual) =||$ 1,650.82||$1,219.32||$1,478.32||$1,649.80||$1,176.00|
The quest to save on car and home insurance ended happily. It was pretty easy to switch over to Progressive, and all the agents I dealt with (at StateFarm, Geico, and Progressive) were all very friendly and courteous. The entire process took much longer than I anticipated (research and phone time was about 2 hours total), but the savings were well worth it. Where else are you going to get $237 per hour of your time?