There are certain things that neighbors should never discuss if they want to remain neighborly: Their salaries, their political views and the state of each other's lawns. Add to that list one more topic, the cost of each other's auto, life or homeowners insurance policies.
You might be surprised to learn that your neighbor is paying less for his insurance policies, even though you both live in the same neighborhood and have insurance with the same company. This information might anger you. You might think it's not fair.
But before you call your insurance company to complain, take a deep breath. The odds are that there are several good reasons why you pay a higher premium each month than does your neighbor.
Consider auto insurance. Maybe you have three speeding tickets on your record. Or maybe you were involved in two accidents in the last three years. Your neighbor, on the other hand, might have a clean driving record. Maybe your neighbor commutes to work each day on the train while you drive your car 200 miles to and from work each day. Your neighbor might have an alarm system to protect his car from theft while you do not.
Each of these factors can lower your neighbor's auto insurance rate while boosting yours. Insurance companies provide discounts for a wide variety of factors. If your neighbor's rates are lower, it might be because she qualifies for more discounts.
The same holds true for homeowners insurance. Your neighbor might have an expensive alarm system protecting her property. This can lower her insurance rates. Your neighbor might have a smaller home that is worth less than yours. Again, this could cause his insurance rates to drop while yours rise.
Insurance companies tailor their policies to the individuals taking them out. If you're a smoker, for instance, your life insurance policy will cost more.
Don't look for a conspiracy, then, if your neighbor's insurance policy happens to cost more than yours. Most likely, there are several logical reasons for the price discrepancy.
Does Having an Auto Security Alarm Save You Money on Your Car Insurance?
When you purchase insurance, regardless of whether you buy a home, auto or health insurance policy, you do so with the expectation that if and when you have to file a claim for a repair, the compan...
Read More →
Do Wood Burners Change your Home Insurance Premiums?
If you install a wood burner or wood stove in your home, your homeowners insurance policy may need to be updated to comply with state insurance regulations. Laws vary from state to state, and it wo...
Read More →
How does the Insurance Company Determine the Cost of Each Driver on My Policy?
Thanks to online comparison tools, car owners looking for the best auto insurance coverage can look at competing quotes from a range of insurance companies. Many wonder how a company determines the...
Read More →