Low Cost Automobile Insurance May Bring Grave Consequences to Some Insureds

Ed Sneneh, CEO of Insurance Navy warns his company’s clients of the grave consequences of using the Low Cost Auto Insurance as an alternative for quality insurance products provided by standard carriers. “The current economic situation is pushing many consumers to find cheaper alternatives for their spending, including auto insurance premiums, and that can leave them in jeopardy of getting a low cost- low liability policy that may come at a very expensive cost in the event of a future accident ’, Sneneh said.

Low Cost Auto Insurance comes normally with low liability limits, perhaps the same limits that are mandated by the state. The State of Illinois, for example, mandates limits of [20/40/15, 20/40]. The first two numbers in 20/40/15 would mean in an at fault accident each person injured would receive a maximum of up to $20,000 with only $40,000 allowed per accident for all people injured (here we are talking about persons in the other vehicle, not the insured’s vehicle). The last number refers to the total coverage per accident for property damage which in this case would be $15,000. The second set of 20/40 means that in the event that the insured suffers bodily injury from accident caused by an –uninsured motorist- then his/her company will pay maximum of these limits for persons in the insured’s vehicles.

Most Low Cost Automobile  Insurance does not include the –underinsured motorist- coverage, which is similar to the –uninsured motorist- coverage but applies in situation where you, the insured, suffers from an accident by someone who has insurance, but his/ her insurance limits were not enough to pay for the bodily injuries of you and people in your vehicle.

“We are seeing a trend of people insured at high limits with standard carriers asking for lower prices and this can have grave consequences for some people who need more protection and higher liability limits, if they accept offers of low cost, low limits insurance”, Sneneh revealed. Whether your company is excellent or not, accepting lower liability limits may have grave consequences on the wealth of insureds in the events of car accident related lawsuits.

“This is not to undermine or downgrade the important roles that low cost automobile insurers play in our society,” Sneneh added.  Low Cost Auto programs and non-standard insurers are playing vital roles in our society. There are many people who are not acceptable with companies that offer high limits (i.e international licensees, holders of Mexico and Canada driver’s licenses.) Also, high risk drivers and un-licensed drivers have no way to get coverage with standard carriers that provide high limits at relatively lower price, and in the event that high limits policies are available for these classes of drivers the premium can be extremely high. Non standard carriers and low cost auto insurance programs come very handy here, and they fill the gap for very important social and economic needs.

Sneneh stressed the importance of ‘needs analysis’ approach in buying auto insurance. “The best auto insurance policy is the one that you need at the price you can afford,” Sneneh said. Our company represents dozens of standard and non-standard carriers, those that can offer wide range of auto insurance products at different premiums,” he added. Dealing with an independent insurance broker has tremendous advantage these days in this tumultuous  economy and competitive insurance industry.

Insurance Navy is a leader in the independent insurance brokerage business. The company represents dozens of standard and non-standard local and national insurance companies. Based in Chicago, the company is providing Automobile Insurance, SR-22 Insurance, Business Insurance and Trucking Insurance in the States of Illinois, Indiana and Michigan. The company founder, Ed Sneneh, an insurance agent since 1989, is a former college instructor of insurance and finance, and is a Charted Financial Consultant. The company offers free and instant automobile, business, and health quoting systems on its website http://www.InsuranceNavy.com .

September 22, 2008