Do insurers offer minimal policies for a car driven 3-4 times per year?

[ashyokami]

I own a 2010 Mazda3 which I only drive 3-4 times per year for weekend trips when I leave the city. (I do everything else by bicycle or bus.) State Farm is charging me about $90/mo for the privilege of not driving my car, which includes good driver discounts and my parents' 25+ year history with them. Geico and Progressive's web sites don't show any cheaper options.

I have sent all 3 insurers an email asking about reduced rates (I'll call later when I'm not at work). Do insurance companies generally offer reduced insurance types for long term storage? I also may qualify for USAA, do they generally offer cheaper rates? Anywhere else I should look?

Thanks.

edit I'm in WA if that's important.

 

[marie1960]

@ashyokami I would ask your State Farm agent about a withdrawal from use policy and/or suspension or storage policy. Basically, all coverages but Comprehensive (which covers theft, vandalism, etc) are suspended or removed from the policy, with the understanding that it will not be driven. When you want to drive it, you call your agent/24 hour service and have it reinstated.

 

[conhocgioi]

@ashyokami If I were your agent, I would advise you to put the car in storage (comp only) and call me when you want to put liability on it to drive then call me again when you want to put it in storage.

One of these guys said that the service reps might get annoyed, but that's their fucking job. I get these calls all day and I'm fine endorsing a policy, it takes five minutes of my time and that's what I'm paid to do. I AM the guy you would call and I won't get annoyed if I talk to you eight times a year.

I will get annoyed if you try and make me explain the eight declarations pages you will get in the mail.

Long story short, put the car in storage, call State Farm when you want to use it. Everyone else is overthinking it and it's not as much of a hassle for you as you think. It's a 45 second phone call.

"Hi, this is Pentium, I'd like to put full coverage on my Mazda effective this Saturday. Thanks."

When you get back.

"Hi again, this is Pentium, I'd like to put the Mazda in storage effective Monday."

You could even back date it most of the time, so if you get back on Monday forget to call until Friday and tell them you'd like it effective Monday, they should be able to put it in storage backdated. It won't work the other way though. Don't try and backdate the liability coverage.

Anyway. This is getting out of hand.

You'll be a savvier consumer if you take the extra ten minutes a year and make some phone calls.

 

[dannyboy1958]

@conhocgioi "ne of these guys said that the service reps might get annoyed, but that's their fucking job. I get these calls all day and I'm fine endorsing a policy, it takes five minutes of my time and that's what I'm paid to do. I AM the guy you would call and I won't get annoyed if I talk to you eight times a year."

Yes, well, if you're a CSR and employee of the company, you may not be annoyed, but the insurance company will, as they will be losing money on this policy. If they're losing money, they will find a reason to cancel it.

If you're going to suspend coverage/put comp only, do it in such a way that the insurance company doesn't want to cancel you. Give them notice, put it on for a month, take it off. If you do that a couple times per year, that's alright, but otherwise they will find whatever reason they can to get rid of you.

If you had another car, you could get your broker to hold coverage for a day with some notice and no premium difference. In your situation, you're going to be pretty much stuck with paying for most of the year most likely.

 

[conhocgioi]

@dannyboy1958 I'm sorry, man, but I'm going to disagree with this as well. I've worked for Farmers Insurance / Zurich & now with a local agency.

There is no way that a company larger than Farmers gives a damn how many times you change your policies a year. They're not ever LOSING money on this guy. Large firms like State Farm don't get 'annoyed' they merely weigh whether having him as an insured is profitable or not.

If he has a good claims history and pays his bills on time, whether he has comp only or full coverage doesn't matter at all to them.

The only snag would be if he only had the one vehicle, some companies won't let you write your only vehicle as comp only (AutoOwners, for example).

 

[dannyboy1958]

@conhocgioi Whether or not the insurance company does anything about it, or notices is another story, but if he has one vehicle and has it endorsed 4 times per year (8 endorsements if you consider to take it on and put it back), they have lost money.

 

[conhocgioi]

@dannyboy1958 I'm not trying to pick a fight on the internet, but I'm having a hard time wrapping my mind around how exactly the insured is taking money from the firm? The amount going in will be greater than the amount going out no matter how many endorsements he makes.

 

[dannyboy1958]

@conhocgioi I'm not trying to battle you either, it isn't immediately apparent. It is similar to the fact that the first year of an insurance policy, no one makes any money. There is a cost to everything, right down to the paper it is printed on, and the salary that they pay the CSR to take the calls. On the broker side it becomes more apparent, but that is also because as a broker, we have to be more aware what is profitable for the insurance companies we represent, in order to stay in good standing with them.

Then again, with larger direct writers who don't train their employees well enough, have nearly everything online, and put all of their funding on to the adjusting side will obviously see less of a hit from that.

It would be one thing if this was a policy with 5 cars that were constantly switched and over $5000 premium, but for a dinky policy like this, it wouldn't be worth the paper it is printed on.

 

[conhocgioi]

@dannyboy1958 Unless he's got another policy with them. But I don't know. That could be a game changer.

Also, I respect your point and your opinion, all that could very well be the case. But I am confident in my opinion, that it won't matter to State Farm and they won't cancel him for it. Even if they do non-renew, it's not like he's got a whole lot invested in them and he could find another line that will be more suited to his needs.

 

[ashyokami]

@dannyboy1958

but if he has one vehicle and has it endorsed 4 times per year (8 endorsements if you consider to take it on and put it back), they have lost money.

I don't see how. Since the car sits in an access-controlled garage for about 360 days per year, and I have a 100% clean driving record, I'm at about zero risk of filing a claim.

The goal here is for me to pay full coverage for those 5 days/year when the car is used.

 

[ashyokami]

@conhocgioi

The only snag would be if he only had the one vehicle, some companies won't let you write your only vehicle as comp only (AutoOwners, for example).

This is my situation, it's my only car. I moved to the city a year ago and bike/bus everywhere so I don't drive unless I'm going on a long trip. But since the car is paid off, other than insurance it's costing me very little to own. I'd rather keep the car and have it last for 25+ years than sell it and pay for rentals for my trips (plus I prefer my Mazda3 to a rental).

 

[conhocgioi]

@ashyokami Have you called and asked them if they would put your only vehicle with comp only? It's possible. There are insurers who will, if they won't. But I assume you've got some other policies with State Farm? Like home or renters?

 

[ashyokami]

@conhocgioi I emailed them yesterday. I am told that I can go comp-only, but if I want to put full coverage back on it takes 2-3 days' notice. They're supposed to get back to me today with what my exact comp-only rate would be. I also have a renter's policy with State Farm.

 

[conhocgioi]

@ashyokami Good. It sounds like you can work this out.

 

[ashyokami]

@conhocgioi The 2-3 days' notice seems weird and inconvenient, but since this should save me a good chunk of money, I'll live with it.

 

[conhocgioi]

@ashyokami It would be different if you were dealing with the company direct, like a Progressive or a Foremost, but when you have a local agency - the processing usually takes a bit longer.

 

[calledtodiscernment]

@ashyokami Most insurers rate on 1 or more of the following variables related to how often you drive:

* Annual mileage

* Daily mileage

* Usage (commuting, business,pleasure, etc)

* Number of days spent commuting

If your car is in long term storage and you own at outright - in other words, you don't make loan payments - you should be able to insure it with just comprehensive (other than collision) coverage. This should be very cheap (definitely less than 1080 per year).

The problem you're running in to is that you do drive it sometimes, so it's not really in long term storage. As a result you are carrying Liability coverage, and probably collision. These are much more expensive, and account for most of your premium.

You pretty much have two options from my point of view:

* Tell your insurer that you only want comprehensive. Then, if you know you have a trip coming up you can endorse to add liability and collision. After the trip endorse back to comp-only. I will say that your service rep is going to be annoyed with you for doing this, but you will have the advantage of paying for only the coverage you need.

* Stop driving the car altogether, and put it in actual long term storage (returning the plates and everything). It'll be there when you eventually want to use it more frequently, and in the meantime you can just use a ZipCar solution for your weekend trips.

Hope this helps!

 

[ashyokami]

@calledtodiscernment For me, the stated values are:

• Annual mileage: 1500 (and this is very conservative, it's probably more like 800-1000)
• Daily mileage: 0
• Usage (commuting, business,pleasure, etc): Pleasure
• Number of days spent commuting: 0

State Farm knows all of this already.

If your car is in long term storage and you own at outright - in other words, you don't make loan payments - you should be able to insure it with just comprehensive (other than collision) coverage. This should be very cheap (definitely less than 1080 per year).

Yes, I own the car outright and it's just parked in my apartment building's secured garage.

The problem you're running in to is that you do drive it sometimes, so it's not really in long term storage. As a result you are carrying Liability coverage, and probably collision. These are much more expensive, and account for most of your premium.

Yep, this is the issue. I need those things 3-4 times per year, but I don't want to pay for them all the time same as someone who commutes to work every day with their car. I'm at basically zero risk of filing a claim and I want my premium to reflect that.

Besides, the car basically is in storage. I've gotten it out once in the past 4 months, and that was just so I could get a jump from someone after the battery died from the car not being driven. (I've got a battery disconnect now, that won't happen again.)

Tell your insurer that you only want comprehensive. Then, if you know you have a trip coming up you can endorse to add liability and collision. After the trip endorse back to comp-only. I will say that your service rep is going to be annoyed with you for doing this, but you will have the advantage of paying for only the coverage you need.

This seems like what I need to do. I don't care how much I annoy my insurer, I don't want to pay for a insurance I don't need or use. I'm going to call State Farm later and ask about this, I'm not sure how much a single weekend's worth of full coverage would be vs. keeping it on full time.

Stop driving the car altogether, and put it in actual long term storage (returning the plates and everything). It'll be there when you eventually want to use it more frequently, and in the meantime you can just use a ZipCar solution for your weekend trips.

This really doesn't make much sense for me. I don't have any desire to return to a lifestyle where I'm driving every day, I choose my housing location so I'm in biking distance of work and everywhere else I want to go. I kept the car because it's paid off and theoretically shouldn't cost my much to hold on to, but this means I shouldn't pay for full coverage insurance all the time. Surely the cost of weekend insurance is cheaper than renting a car or ZipCar, not to mention ZipCar has mileage limits so I can't get one for a road trip anyway.

 

[calledtodiscernment]

@ashyokami

I'm not sure how much a single weekend's worth of full coverage would be vs. keeping it on full time.

Whenever you endorse your policy, a new annual premium amount is calculated. The insurer then refunds or charges you a pro rated amount based on how much of the term is left. So it should look something like this:

-Day 1-99 of policy, comp only, $100 annual premium (for example)

-Day 90-92, add full coverage for a trip, $1000 annual premium

-Day 93-250, back to comp only, $100 annual

-Day 251-253, add full coverage, $1000 annual

-Day 254-365, comp only, $100 annual

Each time you change coverage (this is known as endorsing your policy) the insurer will send a bill/refund that is pro rated. For example, the first endorsement occurs about 25% of the way through your term, so they will calculate the new $1000 premium and send you a bill for $750.

Similarly, when you drop full coverage, they will send you a check (assuming you paid that $750) reflecting the pro-rated difference between the $1000 and the $100.

In the hypothetical above, 6 days of the term are at the $1000 rate, and the rest is at $100. Your actual cost to insure for the year should be about 1.6% * 1000 + 98.4% * 100 = $115.

Note that some insurers have weird pro-rating rules that levy a fee on you each time an endorsement is processed, but these are usually pretty small (a few dollars).

tldr - You'll pay significantly less money if you only carry full coverage for the weekends you drive, and carry comp-only at all other times.

 

[resjudicata]

@calledtodiscernment As someone who works in billing on a corporate level for an insurance company, this may make a small mess of your billing situation as noted above (with all the refunds and invoices and whatnot), so be ready for that. As long as you're prepared to pay the bills and THEN get your refunds, you'll be fine. I see a lot of people who try to do this, wait for the coverages to be removed again and then pay the bills (so they're paying the smallest amount possible), but a lot of times by the time we can get those endorsements pushed through underwriting and processing, the bill is already past due and you have late fees and cancellation notices.