Why is My Policy Premium Different Than My Quote?

Insurance Quote vs. Premium

Has this ever happened to you? You call an insurance broker, give them all your information, and get back a super quote that meets all your needs at a price that might be significantly cheaper than what you are currently paying. Or maybe you have a few tickets on your record, and you expect your rate to go up, but the quoted premium is not nearly as high as you expected.

But then when you ask the broker to finalize the policy for you, the premium is not what you discussed. Sometimes the difference is minor. Sometimes it’s not even close. This is always frustrating. At the very least, you feel let down. In extreme cases, you may feel like you were deliberately deceived.

Unfortunately, this happens all the time when you’re shopping for insurance. Whether you’re shopping online, on the phone with a broker, or even in person. About 80-90% of quotes change at least a little by the time the policy is finalized. Sometimes, the premium could even go down (but nobody ever complains about that LOL). There are a bunch of reasons.

As one of the leading insurance brokers in Ontario, Mitchell & Whale provides hundreds of quotes a day on products ranging from home and auto insurance to cyber liability insurance for businesses, to specialized policies for items like vintage motorcycles and right-hand drive cars. We pride ourselves on doing a thorough job, and asking all the right questions, before offering you a series of quotes from different insurers. If you’re sure your answers are 100% accurate, your quote should be accurate, but there might still be some possible discrepancies because of human error.

Insurance tip

Did you know?

In order to verify that your driving record is correct, your broker has to get your permission, and then the insurance company has to pay $15 to get your driving record from the Ministry of Transportation. Because of the cost, they usually only do this after you’ve finalized the policy. So the initial quote is often based on YOUR best recollection of your driving record. This causes many of the discrepancies.

We asked one of our most experienced brokers to explain this phenomenon, who is responsible, just how much the quote can vary and why, and what you can do to get the most accurate quote.

What information could be wrong?

The following are examples of information that could be entered incorrectly when getting a quote:

  • Most people don’t know the exact model car they drive. You may tell the broker you drive a Chevy Silverado LTZ, but when they later enter your VIN number, it turns out it’s a Silverado High Country. Or you may think you have all-wheel drive, and it turns out you don’t.
  • You may not remember exactly when you first got your license. You tell the broker you think it was 2010, but when they later check your records, it turns out it was 2012.
  • If you don’t own your own business, you may tell the broker that you don’t use the car for business, but later it may come to light that you drive to sales calls all around the city. This is a business use, and will change the premium.
  • When you first get a quote, you may say that you are planning to transfer both your home and auto insurance to the same company. You would get a quote based on a “bundle” or multi-line discount. That discount won’t apply if you don’t end up transferring your home insurance.
  • Perhaps you said that you were the only driver using the car, which is probably true, but later it turns out that there are other licensed drivers in your house. Any licensed driver in your house could potentially drive your car, and that can affect your premium.
  • You may think that you have no tickets or accidents on your record because you think it’s been long enough that they’ve dropped off. Accidents usually stay on your record for 6 years, and tickets stay for 3 years. That’s from the date of conviction. You may think it’s the date that you got the ticket.
  • You may want to get basic insurance (no collision or comprehensive coverage), but if your car is financed, this coverage is required. That will make a big difference in the premium.

There are myriad examples, but the point is that small details can change your premium by hundreds, even thousands, of dollars a year.

Who’s to blame for the discrepancy?

There are three reasons that the information used for a quote can be wrong.

  • Reason #1: The client doesn’t remember details – By far the most common reason for a discrepancy between the quote you’re given and the final premium you pay is that you get a quote based on approximate information, and then when the broker pulls up your records later, something doesn’t match.
  • Reason #2: Broker error – We’d like to say we never make mistakes, but in the case of a quote given over the phone, the broker could input something incorrectly, and then later, when it’s corrected, the premium changes. The letters ‘b’, ‘d’ and ‘t’ sound very similar. If your phone connection is bad, it’s easy for the broker to hear the postal code wrong, or a VIN.
  • Reason #3: The client knowingly gives the wrong information – Again, it would be nice if we lived in a world where everyone told the truth all the time, but the fact is that some people will try to get lower rates by giving the wrong information. Often this can be about accidents and convictions, which can have a huge impact on premiums. Ultimately, before the coverage is finalized, someone will ask to verify your driving record, and the truth will come out. It’s also fraud, so generally we recommend against it. Never lie to your doctor, lawyer or insurance broker.

What’s the best way to get an accurate quote?

At Mitchell & Whale, we try our very best to give you an accurate quote. That’s one of the reasons that we stopped offering online quotes. Online quoting software relies on the client to input accurate information, and these quotes are almost never correct. If you call for a quote, the broker can ask for your driver’s license number and pull up your records on the spot. They can also ask more questions when your answers aren’t clear or contradictory.

Regardless of how you choose to buy insurance, talking to someone is always preferable to getting an online quote, because a live agent can ask for clarification if necessary. And regardless of whether you get a quote by phone, in person or online, try to have all the relevant documentation handy before you begin. Mostly, that means your driver’s license and the VIN number of your car. With this information, your broker will likely be able to give you a quote you can count on.

Resources:

Before asking for a quote, have the following information handy:

  • If you’re licensed in Ontario, you can get a copy of your driving record here. It will tell you how long you’ve been licensed, and show any tickets and conviction dates.
  • To make sure you are quoted on the right vehicle(s), have the VINs handy. The VIN can be seen on the driver’s side of your front windshield where it meets the hood of the car. Try to take a picture with your smartphone so you can double-check.
  • See a full list of all the different questions that are used by insurers to calculate your premium. In Ontario, insurance companies can only rate you on certain factors, so the questions will be the same no matter who gives you the quote.


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