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Auto Insurance Question
Old 01-12-2021, 03:49 PM   #1
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Auto Insurance Question

We just got our annual auto insurance renewal and I'm calling my insurance agent tomorrow. I know we talked to him in the past, but it still doesn't make sense and I wanted to run this by the group.

My insurance information classifies DW and me both as "employed". There is another line that classifies as "driving to/from work/school >10,000 miles per year".

I know we discussed this in the past (when I retired) and he said that if we changed the information, we'd pay more. Neither of us is employed and neither of us drive more than 10,000 miles per year.

Does it make any sense that correcting this would cost us more? It seems the less we drive and better yet, not driving during work hours every day, should rate us as less risk and therefore cheaper. Do people go crazy when they retire and start driving wild? Has anyone else experienced this? I want to get my thoughts together before we discuss this with him again.

Thanks.
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Old 01-12-2021, 03:54 PM   #2
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May make sense for your agent but not for you. In getting our auto coverage, we have found miles driven annually a very significant factor. You will probably find it worth your time to shop your coverage. After over 4o years with State Farm, we got significant savings moving to Amica.
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Old 01-12-2021, 03:55 PM   #3
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I know we discussed this in the past (when I retired) and he said that if we changed the information, we'd pay more. Neither of us is employed and neither of us drive more than 10,000 miles per year.
That is absolutely backwards. Changing the designation to retired, driving for pleasure only, and low annual mileage normally drops your rates significantly.
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Old 01-12-2021, 04:02 PM   #4
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That is absolutely backwards. Changing the designation to retired, driving for pleasure only, and low annual mileage normally drops your rates significantly.
Right! But it will drop the percentage that the agent gets.

"You're retired? oh, I'll need to sign you up for the >1,000,000 mile rate"
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Old 01-12-2021, 04:12 PM   #5
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I remember back in 1988, when I turned 25, looking forward to seeing my premium drop because I would move from a very high-rated age class (21-24) to a lower one (age 25-29). I reminded my agent about this but when the renewal notice came in, the IC for some reason changed my use class from the low-rated "pleasure use" to the higher rated "work/business" use. My premium did drop a lot (several hundred dollars) due to the age class change, but it didn't drop as much as it was supposed to drop.

I told my agent about it and they had the home office send out another premium notice which put me back into the "pleasure use" class. My 6-month premium dropped by another $70. So, yes, it was worth the effort to question the error and get it fixed. If they had misrated me into a higher annual mileage class, I would have questioned that, too.

Given that at the time I was working in the actuarial field, specializing in personal auto insurance, there was no chance I would miss their mistake.
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Old 01-12-2021, 04:18 PM   #6
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In general insurance companies charge less when people drive fewer than 6,000 miles per year and driving is for pleasure rather than for work. But your insurance company may be going against the norm. I would get a few other quotes and see how the numbers look.

We drive less than 6,000 miles per year and get a significant discount compared to the rates for driving 6000+ miles per year.
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Old 01-12-2021, 04:22 PM   #7
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The one thing I hate about homeowners and auto insurance is that after years of being a great customer you need to go shopping. One of my most successful dealers back in the day told me "you've got to screw your friends because your enemy's won't let you". Same with employment. Loyalty has a cost. New hires make more than 10 year employees, yet less than 20 year employees, however they're being forced out the door.
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Old 01-12-2021, 04:49 PM   #8
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Right! But it will drop the percentage that the agent gets.

"You're retired? oh, I'll need to sign you up for the >1,000,000 mile rate"
I'm not naÔve, but this would be very disappointing. We have everything through AAA and have been with them for almost 40 years. I never thought of them as cheap, but a good value for a good company. We've been with this agent for 10 to 15 years. Again, I'm not naÔve, but he's been a great person to deal with. I'm going to be very upset if I find this is the logic in his recommendation. It doesn't make sense, because he's recommended other things in the past to save us money. We'll see how tomorrow goes. I'll give him plenty of rope and see what he does with it.

I will say, when I last talked to him, I probably thought I'd drive more than 10,000 miles. But, I'm sure me and DW together will not drive > 20,000 miles.
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Old 01-12-2021, 05:34 PM   #9
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.... I'll give him plenty of rope and see what he does with it.....


I know my State Farm policy will periodically request that I verify that I'm still driving my truck less than 7500 miles/per year, so I assume I'm saving money.
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