For Eastern Michigan University student Hannah Armstrong, finding affordable and trusted car insurance was a struggle.
After weeks of frantically calling companies and receiving quotes from agencies, she finally settled on a policy from Meemic that costs over $700 for a six month period.
“Progressive said that it would be over $1,000 for a six month payment, and I said that’s not an option for me,” Armstrong said.
Meemic offered her a lower rate, taking into account her position at an education institution, which in her case is working for the Rec/IM.
This is a common situation according to insurance agent Brian Clark, who works at the Daniel Amori Agency in Ypsilanti.
“You pay the most if you’ve never had insurance,” Clark said. “The longer you’ve had insurance, the less you’ll pay. The biggest factor that comes into the rate is credit. They [college students] don't have credit, or if they do, a lot of the time it’s not very good.”
Armstrong also experienced difficulty when trying to receive a policy from Auto Owners, a company that her family had been with for over 20 years.
“Once I said was switching to Meemic, Auto Owners came back with a lower quote,” Armstrong said.
Clark said while agents who do that give other agents a bad name, it’s common for college students to be quoted higher then average. Because insurance is a commission based business, more money to the company means more money to the sales person.
The insurance agents don’t change the policy rates, only the policy itself. While there are insurance agents who will try to charge as much they think they student will pay, Clark said tmany of them recognize that “a lot of times you’re weighing between having insurance and not having insurance,” and will try to find an option that works.
Although the reality is that college students will have to pay more for car insurance, Clark does have some tips to help make sure they find the best price around.
- Bundling car insurance with other kinds of insurance can help lower the cost. Renters insurance is the most commonly used insurance that college students bundle with. Clark helped a college student lower her monthly payment from $225 for just car insurance to $200 by adding renters insurance.
- If it’s possible, try to cotitle a parent or guardian on the insurance so the company can use their credit and insurance tenure.
- Get more than one quote. Shopping around can help make sure college students are seeing all of their options before purchasing.
- Don’t buy insurance over the phone or on the internet if you have the option to go in and talk to someone personally. Working with an agent directly will help students get the best deal and find discounts they may have missed when going through an online company.
According to Clark, college students are particularly aware of what they’re purchasing when they buy it.
“I’m blown away by college students who come in and read through the paperwork. They truly gain an understanding for what they’re getting,” he said.