This is the oldest cliché. And, call me naïve. But, I’m really not sure why it's taken me so long to believe that it's 
almost always true. In this case, it has to do with buying the annoying, yet necessary product called car insurance.
Like most consumers living though this recession, I've tried to be smarter about personal finances and have cut costs over the last year. Considering I rarely ever have an insurance claim with any of our family cars, finding a carrier with a cheaper policy seemed like the natural thing to do. I should preface this story by stating that I've always had pretty high end insurance (from Chubb.) The service was always top of the line and the few claims that I submitted (I think two over last 10 years) were handled in a first class way. The issue at hand was simply how expensive it was to insure three cars on a Chubb policy.
So, I went comparison shopping. That's an interesting experience. When price becomes the main consideration in buying this product, it's pretty easy to understand why companies like Progressive and Geico are key players in this ball game. With very little change in my deductable and general coverage, very friendly customer service representatives on the phone, and close to $800 per six month period (or double that per year) savings, Progressive made my choice to switch very easy.
So, we cancelled our Chubb policy and handed everything over to this low cost provider. And, I felt pretty darn good.
Then, the trouble began. To obtain Progressive's low cost, every customer has to install this "thingamajig" (that's what I call it) under the dashboard of each car. Basically, it's a monitor that allows the insurer to become "big brother-like" to see how fast you are driving and what types of turns you are making. Theoretically, I had no problem with this. But, these thingamajigs are difficult to snap into the cars and they always seem to keep falling out. It started to become a real hassle when the one in my car fell out every week and Progressive started sending me email after email pleading with me to put them back in. My point in all this: Progressive's initial friendly customer service wasn't all that customer centric after all and caused me to waste a lot of time dealing with an issue that I should never have had to think about.
Next issue: Someone smacked my wife's car. It wasn't too bad, except the front right bumper/side was smashed in. My wife went through the process of filing a claim. This meant taking the car to the one, middle-of-no-where garage that Progressive deals with and getting a quote on how much it would cost to fix. What we found out is that the garage basically offers up a low ball quote on what Progressive will pay to fix it, not what the actual cost will be to do it right. There was a $700 gap between those two variables. That really annoyed me. In the end, we simply sucked it up, went to the Honda dealership and paid for them to do it the right way. Now, I was starting to experience firsthand how a low cost provider could make real margins.
The final straw that broke my camel's back was when the six month initial insurance coverage period was over. I don't have a lot of time to continually search for new insurance providers, so even though I wasn't feeling good about Progressive, canceling my policy wasn't an option yet. That was until they sent me a new quote for the same coverage. It was almost $600 higher... for no real reason. I called them to inquire why and received nothing substantial for why the price was so much higher. That's when it became clear to me that this initial cost was really a way to reel me into their world. Then, when they had me, they could change everything and make some real money.
Many people rave about Progressive. Clearly, I will never be one of them. But, I'm not sure that I have any real lingering negativity towards the company because of my experience (although I am changing carriers.) Instead, I've looked in the mirror and hopefully have learned enough to not be fooled again to think that cheaper could be better (or at least just as good.) Whether it be around insurance, healthcare, consumer products or even PR services, you get what you pay for in life. If you decide to go really cheap, then you better reset your expectations on what the outcome will be.
Like most consumers living though this recession, I've tried to be smarter about personal finances and have cut costs over the last year. Considering I rarely ever have an insurance claim with any of our family cars, finding a carrier with a cheaper policy seemed like the natural thing to do. I should preface this story by stating that I've always had pretty high end insurance (from Chubb.) The service was always top of the line and the few claims that I submitted (I think two over last 10 years) were handled in a first class way. The issue at hand was simply how expensive it was to insure three cars on a Chubb policy.
So, I went comparison shopping. That's an interesting experience. When price becomes the main consideration in buying this product, it's pretty easy to understand why companies like Progressive and Geico are key players in this ball game. With very little change in my deductable and general coverage, very friendly customer service representatives on the phone, and close to $800 per six month period (or double that per year) savings, Progressive made my choice to switch very easy.
So, we cancelled our Chubb policy and handed everything over to this low cost provider. And, I felt pretty darn good.
Then, the trouble began. To obtain Progressive's low cost, every customer has to install this "thingamajig" (that's what I call it) under the dashboard of each car. Basically, it's a monitor that allows the insurer to become "big brother-like" to see how fast you are driving and what types of turns you are making. Theoretically, I had no problem with this. But, these thingamajigs are difficult to snap into the cars and they always seem to keep falling out. It started to become a real hassle when the one in my car fell out every week and Progressive started sending me email after email pleading with me to put them back in. My point in all this: Progressive's initial friendly customer service wasn't all that customer centric after all and caused me to waste a lot of time dealing with an issue that I should never have had to think about.
Next issue: Someone smacked my wife's car. It wasn't too bad, except the front right bumper/side was smashed in. My wife went through the process of filing a claim. This meant taking the car to the one, middle-of-no-where garage that Progressive deals with and getting a quote on how much it would cost to fix. What we found out is that the garage basically offers up a low ball quote on what Progressive will pay to fix it, not what the actual cost will be to do it right. There was a $700 gap between those two variables. That really annoyed me. In the end, we simply sucked it up, went to the Honda dealership and paid for them to do it the right way. Now, I was starting to experience firsthand how a low cost provider could make real margins.
The final straw that broke my camel's back was when the six month initial insurance coverage period was over. I don't have a lot of time to continually search for new insurance providers, so even though I wasn't feeling good about Progressive, canceling my policy wasn't an option yet. That was until they sent me a new quote for the same coverage. It was almost $600 higher... for no real reason. I called them to inquire why and received nothing substantial for why the price was so much higher. That's when it became clear to me that this initial cost was really a way to reel me into their world. Then, when they had me, they could change everything and make some real money.
Many people rave about Progressive. Clearly, I will never be one of them. But, I'm not sure that I have any real lingering negativity towards the company because of my experience (although I am changing carriers.) Instead, I've looked in the mirror and hopefully have learned enough to not be fooled again to think that cheaper could be better (or at least just as good.) Whether it be around insurance, healthcare, consumer products or even PR services, you get what you pay for in life. If you decide to go really cheap, then you better reset your expectations on what the outcome will be.
Pretty harrowing experience with Progressive. I have GEICO insurance and have had for some time and can't say I've had any problems with them, nor any major rate hikes, etc. I haven't had any accidents, either, so I can't compare with them on issue #2. But on low hassle and maintaining low cost, they are great, and their customer service has always been easy to deal with.
Posted by: Sam Ford | November 11, 2009 at 01:50 PM
Yes, GEICO is THE best car insurer. Never had a problem in over 14 years with them. Their customer service is excellent. A pleasure in fact. Try them.
Posted by: Debrah | November 11, 2009 at 08:00 PM
CSRs are people, and like people in any field, there are good ones and bad ones. I've found consumer experiences can vary tremdously with the same business, based on who you happen to deal with in their organization.
I've had homeowner and auto claims both under Chubb. The homeowner's claims were a pleasure (as much as any insurance claim is a pleasure!) because the reps we dealt with were good. The auto claim was awful and I had to put on my lawyer hat and start sending stiffly worded letters signed "Esq." to get them to honor all the terms of their policy. The rep was rude to boot. Same company, two different individuals, two very different experiences.
Posted by: Steve | November 14, 2009 at 12:58 PM