Thursday, May 14, 2009

Online Quotes For Car Insurance - Direct Auto Insurance

By Matt Hellstrom

You may be wondering if direct auto insurance right for you. Perhaps you're trying to cut costs these days and are evaluating your expenses for areas where you can trim your outgo and maximize your income. If that's the case, then shopping for better auto insurance deals is a wise move.

The business model is called 'direct' because the customer deals directly with the company without the intervention of an agent. The customer gives up the security of personal, on-going contact with the same human in exchange for lower rates. Like all insurance, the trade-off is a gamble. If your claims are straight forward, you may well be happy to deal with a direct auto insurance firm.

The majority of direct auto insurance firms operate only in states or areas where no-fault auto insurance is mandatory. In circumstances where fault determination is taken out of the settlement equation, firms can calculate their rates with much higher statistical certainty. The downside is that safe drivers must go to civil court to recover monies lost to higher insurance rates due to claim-filing for damages that were not the fault of the policyholder.

In fault-allocation localities, who pays the cost for damages and losses incurred in a traffic accident is determined by a finding of fault. It is a fact that payouts are delayed and civil court cases are many in fault-finding jurisdictions. In these jurisdictions, the job description of the insurance agent includes hand holding and claims expedition. But under no-fault rules, the payout is made simply based on damages incurred. This means an insurance appraiser, rather than an agent, is the key player.

The no-fault states, which include the three states with highest populations (New York, California, Florida) enacted no fault legislation in part to simplify and speed payments to accident victims, and in part to reduce the number of time consuming cases in our bulging civil court system. Claims appraising becomes the only bottleneck and no-fault states ease that by instituting approved collision centers. In some jurisdictions the claim centers are government-run.

If there is an area in which one is vulnerable under direct auto insurance, it is in claims that are complicated by physical injury. The affects of a physical injury can continue throughout a person's life. With an agent, the consumer has someone who is familiar with their case and can navigate the insurance process on their behalf. And the agent is available to do that at the start of the injury, when the consumer needs the help the most. It simply is not possible for a call center to take the place of face-to-face contact.

With more and more consumers become aware of options that are available for their insurance dollars, the direct auto insurance is gaining the upper hand. Many such companies now have claim agents that are assigned to the insured and remain on the case until settlement. When considering going with a direct auto insurance firm, check them out carefully - do more than get a rate. You can go to the Insurance Institute of America website and get more info on any direct auto insurance firm.

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