Home Page Group Health Individual Health Business Insurance Home and Auto Insurance

A “name your price” approach might get you a good deal on a hotel room or rental car that would otherwise have gone unused on a particular day, but is that a good way to buy insurance? At least one major company is advertising that they’ll do business with you that way, but be careful if you go down that path.

The laws of the marketplace suggest that sellers should discount products subject to spoilage from age. That’s why day old bread is cheaper. An unused airline seat or hotel room represents spoilage in the travel industry, so getting any revenue at all is better than getting nothing. A name your price deal truly is a win-win for both you and the seller.

But insurance doesn’t spoil. The insurance company can provide all the fresh insurance you want any time you want it, so the principle that makes name your price work in travel doesn’t exist in insurance. It’s a clever marketing approach to attract your attention, but there’s no bargain in it for you.

You will simply get less insurance for a lower price. That might mean extremely high deductibles or very low liability limits. Either of those choices might mean owing a pile of money out of pocket because you bought inadequate coverage.

Blog Authored by: Ken Mogren, CPCU


Posted 9:55 AM  View Comments

Tags: insurance
Share |


1 Comments

Jackie Larson said...
I have never quite understood how an insurance company can advertise "name your price" when it comes to insurance. What you have written is a very good way of explaining what is wrong with this advertising approach.
TUESDAY, OCTOBER 11 2011 3:56 PM

Post a Comment
Name
Required
E-Mail
Required (Not Displayed)
Comment
Required


All comments are moderated and stripped of HTML.
Submission Validation
Required
CAPTCHA
Change the CAPTCHA codeSpeak the CAPTCHA code
 
Enter the Validation Code from above.
NOTICE: This blog and website are made available by the publisher for educational and informational purposes only. It is not be used as a substitute for competent insurance, legal, or tax advice from a licensed professional in your state. By using this blog site you understand that there is no broker client relationship between you and the blog and website publisher.
Blog Archive


View Mobile Version
HomeClaimsGet A QuoteContact Facebook Twitter LinkedIn Youtube Powered by Insurance Website Builder
174 Center Street | Winona, MN 55987
O: 507-452-3366 | TF: 800-657-4448
975 34th Avenue, Northwest Suite 302 | Rochester, MN 55901
O: 507-424-4400 | TF: 800-657-4448