How insurance works....5 day 'course'

Just signed up for this and will post the document each day (5 days worth), source moneysupermarket.com;

DAY 1: What you'll learn, and, most importantly, how you'll save!

Hello Paul *******,

Welcome to our car insurance email course, aimed at getting you the best deal possible on your car insurance - without compromise on cover - by taking a good look at it from the ground up.

All it will take is just five minutes a day for FIVE days, and we guarantee you'll leave understanding your coverage options more fully; feeling more confident in your policy choices; and, getting the best car insurance premium you possibly can.
We are going to change the way you think about insurance and that in turn will change the way you buy it.

And when you know you're making safe and wise choices, it's easier to keep an eye on the costs.

The Plan
When the time comes, we'll ask you to get several car insurance quotes, and compare the results. This "homework" will give you a great head-start by finding car insurance providers and applying for a quote through them.

www.insuresupermarket.com, allow you to enter your personal details just once, look at the whole market and save your quote. This means that as you learn more about how to save on your policy, you'll be able to go back and make changes to lower your quote!

The importance of good car insurance policy.

Every insurance policy you buy is an important one, but we think that right now is an especially important time to examine your car insurance.

Why?

Two reasons:

1. What you have to pay. Car insurance premiums are increasing at an average rate of close to 14% a year. Both new car prices and the number of vehicles per household are steadily rising, too. Count on the cost of your car insurance policy to follow suit.

2 Your financial protection. One big reason car insurance rates keep rising is the cost of liability. Large amounts of money for the injury, pain and suffering, and economic losses caused by a car accident are more and more commonly being awarded by sympathetic juries. (And let's not forget the legal fees involved in any such cases.).

These two facts taken together may make you feel like you don't have a lot of options. Car insurance rates are going to rise, and if you're going to keep your coverage high, you're going to have to pay more. Right?

Not necessarily. There are options and we can help you find them. We think that if you really understand a few important "principles of insurance" and put those principles into action when you buy your policy, you can maintain good quality cover whilst keeping your costs low.

And we'll do all this in just five minutes per day (for FIVE days, of course). Here's our schedule for the week:

• DAY 1: We'll review the basic coverage options on a car insurance policy. If you've been insuring cars for a while, this might seem like old hat. But don't worry, we'll be brief!

• DAY 2: The mechanics of car insurance - or, in layman’s terms - how it all works. This may sound obvious, but it's not. We'll examine exactly where your premium goes so you can see what you're really paying your insurance company for. You might be surprised.

• DAY 3: Who should be your research tool? We will guide you through the main options where you choose to research and buy your car insurance.

• DAY 4: Getting the right policy at the right price. Perhaps the most important day. Now that you know what kind of coverage you need and why you need it, we're going to help find you the right policy at the lowest possible cost!

• DAY 5: How to keep lowering costs. You have your low car insurance quote, now we'll tell you how to cut your costs even further over time.

Okay, back to today's lesson.

We're just going to take a brief look at the car insurance policy most people have and look at some car insurance facts and figures.

The Basics of Car Insurance
A car insurance policy is actually many smaller policies hammered together. What your total policy should look like depends on where you live, what you drive, and what your personal circumstances are.

The major types of car coverage are liability, medical or personal injury, collision, comprehensive, third party fire & theft, third party only,

This, briefly, is what each policy covers:

• Liability. Probably the most important coverage on any car policy, standard car liability is actually made up of two policies, bodily injury and property damage. They cover the cost of injuries and damage you cause to another in a road traffic accident.

• Medical. This coverage pays for the treatment of any injuries you might sustain in a car accident, regardless of who was at fault in the accident. It includes coverage for other economic costs, like lost wages or out of pocket expenses.

• Comprehensive. This covers damage to your car, regardless of fault. The cover will include accidental damage, malicious damage, theft, natural disasters and the damage you cause to other peoples’ property. If your car is financed, you'll probably be required to have a Comprehensive policy.

• Third party fire & theft. This covers damage to your car only if via fire, damage to other peoples property and if your vehicle is stolen.

• Third party only. This covers only the damage to other peoples’ property - your own vehicle is not covered.

• Excesses. Most policies will have a sum of money that you will have to contribute in the event of a claim. These can range from £50 to £500 depending on cover, In addition to these compulsory policy excesses you may wish to take a voluntary excess, which if available can reduce your premium.

So, car insurance can be expensive, but not nearly as expensive as the unlucky events it protects you from. However, that doesn't mean you should just pay any old premium you're quoted. We think that, instead, you're entitled to a reasonable price for coverage that you understand, and value.

But we shall save that for tomorrow, when we'll be taking you through how the car insurance industry works . . .

Today's Action PointCheck your policy to see what type of cover you currently have and ask yourself is this the right cover for me?
See you tomorrow!




The Car Insurance Team
Insuresupermarket

Do you get a stickyfoot and trophy at the end? Cuz if not I won't bother

Never know it might be interesting so i'll post up the emails each day

It says it will enable you to use things like age to your advantage, yeah right

only if your 50 i bet!

I always wondered that you know when it asks your occupation - does your quote depend on your occupation. My mum said being a student made your policy higher? is she pulling my leg?

Mine personally? Tell her to mind her own business

I imagine a few occupations knock it down, a few knock it up, pennies I assume too, also some insurers have deals with unions so if you had a specific occupation they may offer you a hefty discount.

...Well that Paul from the forum....

Lol yes my mums is cheaper because she works for the government But only certain companies offer the discount. i tried to put a couple of different occupations in on online quote but it didnt seem to make a difference. i just wondered why they asked if it doesnt change the price. Maybe they're nosey

See, always right me

I expect it's another way for them to possibly refuse paying out lol.

Maybe i'll find out soon!

I was wondering who insures insurance companies. Bearing in mind many have offices that are open to the public, they should have public liability insurance, but what would be the point in them insuring themselves. I'm not talking brokers, I'm talking the actual insurers.

well as a chef they also ask if you work on licensed premises.mainly due to the freely available alchohol and odd working hours leading to a 'higher' risk.funnily enough my insurance went up when i became a (mature)student

Maybe Lloyds names cover the risk....

It looks like a complicated sales pitch to me...

Exactly what I was thinking!

Erm, nobody is selling anything....lol

Wait until day 5 and I think they will be!

Day 2: (got email slow down due to spam so received this only 10 mins ago)

DAY 2: How Car Insurance Works:

Hi Paul ********,

Today we're going to take a look at a part of car insurance that most people don't usually think about - the way the insurance business works.

Or, more to the point, how your car insurance company uses your premium once you have paid for your policy.

You may think – what is the point of this?

But once you take a closer look at what your insurance company uses their premium income for, you'll be better able to design your coverage wisely and make more efficient use of what you are paying for.

Now, we all know how insurance works: you pay a premium for a certain level of protection in the case of a "covered event". If, unluckily, the "covered event" should take place, the insurance company pays up to your policy limit toward your expenses. And that's pretty much how it looks from our (the policyholder's) viewpoint.

But, realistically, your premium doesn't just pay for your "covered events". It helps pay for anybody's "covered event". Once you pay your insurance premium, it's mixed up in the pot with everyone elses. And the insurance company spends the money as the need arises.

So let's take a closer look at where the needs arise:

You probably expect that paid claims make up the majority of an insurance company's expenses, and that's basically true. For a car insurance company, a little over half of the revenue goes directly toward paying for the cost of their policyholders' accidents.

How about the rest?

Here's a break-down of where your premium money goes:

• 50% for claims

• 25% for the legal and administrative costs

• 25% for the costs of running the company

Obviously, these numbers vary from insurer to insurer. Some insurers are better than others at saving, and some are better at reducing there overheads and business operation costs, thus saving you money.

Let's look at each expense on its own:

Paying the claims
Surprisingly (or not, depending how you look at it,) most of the money paid out on car insurance claims is paid on property damage. Collision damage claims make up around 50% of an insurance company's total expenditures.

But if you look at it another way the largest amount a car insurance company will ever pay you for a collision damage claim, fire or theft claim is the "fair market value" of your car.

And unless you're driving a Rolls Royce or Aston Martin, that's not a great deal of money when compared to, say, a big medical or personal injury claim.

So offering collision and comprehensive cover does cost insurance companies a lot of money, especially considering what small policies they really are.

Insurance Company Admin costs.
Insurance companies spend a lot of time and money processing and settling claims. As much as a quarter of an insurance company’s total expenses can be used to handle these activities.
1. Legal Costs
2. Insurance Fraud
3. Un-insured drivers
4. False injury claims

That said, there is little you can do to affect the rate you pay for your car insurance apart from changing insurer.

Just what can you change?

The biggest change is achieved by reducing the cost to your insurer for a damage claim.
This is done by opting to take an Excess on your policy.

In the event of a damage claim you are saying that you are willing to accept responsibility for a portion of the damage equal to the Excess total agreed upon when you take out your policy.

In addition, these optional excess payments can reduce your initial premium by up to 10% depending on the amount and the insurer.

The cost of running an Insurance Company.
The remainder of your premium goes into the operational costs of running the Insurance Companies business. So what can you do about this?

Insurance companies spend a lot of money on advertising, staff and commission payments to brokers, and agents. If you could bypass both these costs you could save money on your policy.

The best way is by looking for insurance online. In this way you are already accessing the most direct way of buying your insurance.

By comparing insurance quotes online, you can bypass the insurance broker or agent and as such remove their fees and commissions, while at the same time researching the market quickly and conveniently.

Even better, if you research with an online insurance aggregator you can compare rates from multiple providers at the same time and only complete your information once.
Therefore, it is important to realise that www.insuresupermarket.com are the only “Full Search” provider in the UK marketplace today.

Tomorrow's topic is the philosophy of insurance

We still have:
• DAY 3: Who should be your research tool?. We will guide you through the four main options where you choose to research and buy your car insurance.

• DAY 4: Getting the right policy at the right price. Perhaps the most important day. Now that you know what kind of coverage you need and why you need it, we're going to help find you the right policy at the lowest possible cost!

• DAY 5: How to keep lowering costs. You have your low car insurance quote, now we'll tell you how to cut your costs even further over time.

Today's Action Point
See what happens when you lower your or increase your excess

See you tomorrow!




The Car Insurance Team
Insuresupermarket
http://www.insuresupermarket.com