Tips For Online Insurance Shopping
by Dean Shutt, InsWeb

The astounding growth of the Internet as a commercial medium over the last few years has given consumers unprecedented power in their relationship with goods and service providers. Shoppers can now arm themselves with huge amounts of information before making decisions. This has enabled businesses to become more responsive to consumer needs.

One of the areas impacted by the e-commerce tidal wave is insurance. Long the domain of agents, brokers, or direct sales carriers, insurance has proven highly adaptable to life on the Web. By doing away with the massive overhead associated with operating an agency or brokerage, online insurance marketplaces like InsWeb have changed the way people shop for insurance. This new economy allows customers and carriers to save time, money and frustration.

Here are some tips to keep in mind when shopping for insurance on the Web:

1. Know if your data is safe and secure - How long has the company been in business? Are there any complaints about the company with the Better Business Bureau or state regulators? How will the company use your information once you enter it? Does it have security measures in place to protect your information? All of these are valid questions that should be answered before you shop with an online (or offline) insurance marketplace. Also, always read a site's privacy policy before entering any information.

2. Know who you're dealing with - As in the brick and mortar world, it pays to do your homework. How many carriers does the site represent? Is the company an agent? Is it a storefront for a single carrier? Is the company a traditional insurance broker? Depending on what you're looking for, these are important questions to ask. If you want a fast quote with no fuss, an online agent may be right for you. Keep in mind that these "single quote" sites basically perform the same service as your local agent. They will give you one price from one company. If you want to receive multiple quotes and a comparison of different companies and plans, you will need to visit multiple "single quote" sites or visit an online insurance marketplace that represents multiple carriers.

3. Know what you're going to receive - Many online marketplaces offer "filed rates" or "quote estimates." These are general prices that carriers are required to file with your state's Department of Insurance. They do not take your personal information into account, but instead offer you a "ballpark" figure of what might be available. Often these "estimate" sites can't guarantee that you're eligible for coverage from the carriers whose rates they display. A true online marketplace will offer you "carrier-sponsored quotes," which are quotes based on your information that a carrier will honor if you decide to purchase a policy.

4. Know what's expected of you - Just as you could not call an insurance agent and ask for a detailed quote based on only your car's year and make, you can't fill out a 10-question form on the internet and expect multiple, detailed quotes. While an online agent may give you a detailed quote from a short form, he will be unable to provide a true comparison-shopping experience. Expect to provide information on your personal driving history, your spouse (if you're married or separated), your vehicles, and your coverage history. Remember: The more questions you answer, the more accurate your quotes.

5. Know if you can come back - Studies have shown that regular comparison-shopping can save hundreds of dollars annually in insurance costs. One benefit of an online marketplace is the ability to save your information with a user name and password and compare rates as often as you like. Make sure the site you shop with offers an easy and accessible way to save and retrieve your data.

6. Know if you can get help - Insurance can be a confusing process. Different types of coverage, regulations and state laws can make anyone's head spin. Before filling out an online insurance marketplace's form, make sure that the site offers live help to answer any questions you may have about the form.

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