When it comes to leasing, you gotta have 100k/300k coverage as the bare minimum. If you own a home, you probably want more than that. If you rent, you have no choice but to have at least that. The one part of leasing that somewhat annoys me is that because lessees tend to switch cars every 3-4 years, you will be pay insurance premium for new to 4 year old cars. That essentially means you pay more. Here is an example:

When it comes to insurance premiums, it is not solely based on your driving record, but it’s also on the value of your car. During a six-year span, the average 36-month lessee will go through two cars. A buyer on the other hand, can easily keep it for 6 years (most loans are at least 5 yrs nowadays). Since premium are based mostly on the value of the vehicle, as the car depreciates, your premiums drop (assuming a perfect driving record during that time period).

So who is insuring you anyway?

I have had five auto insurance companies insure me since I was 16 years old. First was Farmer Insurance, then AAA (Auto Club of So Cal), Progressive, Mercury and Wawanesa.

Farmers Insurance

I never had to place a claim through them, but my premium was very high because I was a 16 year old teenager. I do know one thing, we didn’t like our agent, he was a scheming little weasel of a man that didn’t return phone calls and kept raising rates.

AAA – Auto Club of So Cal

They where actually pretty decent, I believe I was 20 years old or so when I switch to them. I went through one claim through them and they responded very well when it came to getting my damage appraised and repaired. My biggest beef with them was that they did not follow through in pursuing the other party and see compensation for the damages. They just assumed I was a fault. It was a complicated situation (the car was damaged during transportation), and perhaps I should have try to settled this with the transportation company personally. However, I am was paying AAA to represent me and they failed to deliver. Also, you need to be an Auto Club member, so take on a yearly membership fee to that. I like AAA member services, but I’m not huge on their auto insurance.

Progressive

I had them for about two years and I think their service is unrivaled. They were awesome in terms of customer service. Hit-and-run situation, no problem, they took care of it. Hit a deer on the highway, no problem, sent an appraiser out to look at the damage on the same day. I moved to California (I was in NY at the time) my rate DOUBLED. They aren’t the cheapest around, and they never really gave me quotes from other “competitors”, but I forgive them because of the excellent care they provided during the time I had them. I guess you get what you pay for.

Mercury Insurance (Auto Insurance Specialists)

I actually didn’t know how I end up with these guys. I went to an AIS office to sign up for auto insurance, since in their commercials, they claim to shop your quote around and find the lowest one. They are brokers, so they I ended up giving me Mercury. Their rates were pretty cheap compared to Progressive, so I went ahead with them since I had just leased my BMW 325i and was already paying a hefty monthly payment. I actually kept them until Feb 2008, when a friend of mind recommended me Wawanesa (more on them later).

Mercury (and AIS) suck. They are cheap, but not cheapest. Like their commercials say, they probably are from the planet Mercury because they all sound like aliens instead of humans. I went through two claims with them, both in which I was not at fault, and their case managers spoke to us like they are reading from a script. When we called them, 90% of the calls went to voicemail. They wouldn’t return calls in a timely manner. Heck, I even wrote a nasty letter to them about my experience and all I got was an apology over the phone. Thats it. I stuck with them because they where cheap, so yes, you do get what you pay for.

Wawanesa Mutual Insurance

Notice I put a link on the title? I’m recommending them obviously. I’ll start with the bad, which is the fact that they only cover Oregon and California residents. I switched in Feb 2008 per the recommendation of a friend who enjoyed their quick responsive service and low prices. Low price indeed. They don’t quote the 6-month premiums, instead they quote you for the whole year. My 6-month quote for Mercury was around $900-$1000 ($2000 a year). The quote I got from Wawanesa was $1485 a year. Need I say more? Well, I do actually, I just hope that service is as good as my friend says it is, but other than that, I feel I got a great deal, saved a bunch of money and feel that I’m in good hands…for the time being.

Quick thought here…Insurance companies that advertise a lot tend to have higher premiums due to their advertising costs. Companies like Wawanesa rely on word-of-mouth, which is why their rates are so low. If you don’t live in California or Oregon, try asking friends and family about their insurance carrier. Find out what their experiences are and what their premiums are, it just might save you some money if you ask the right person.