UCR School of Business Assistant Professor of Teaching Jonathan Lim was asked to provide expert insights on Car Insurance Branding for an article recently published on WalletHub.
What does it say about car insurance companies that so many have celebrity endorsers?
When it comes to car insurance, most companies know that the average consumer has a tough time differentiating one brand from another. Asking consumers to spend time thinking about the ins and outs of different coverage plans in a thirty-second commercial is a big request, so companies often resort to celebrities to separate themselves from the pack. These celebrities offer a lot of appeal: they are memorable, draw us in, provide instant credibility, and give consumers a face to associate with the brand. The goal is for the positive qualities of the celebrity that audiences know and love to transfer onto the brand, thus making it stand out.
Do you think car insurance companies try to mislead customers, or is it just marketing?
These tactics are all a part of good marketing—the use of endorsers is one of the oldest, tried-and-true tools in the marketer's playbook, and all sorts of companies have used this as a way to differentiate themselves from competitors and communicate who they are to consumers. That being said, while a good celebrity can make a brand shine a little brighter, it is still the company's responsibility to provide meaningful value to consumers through its product or service. At the end of the day, a company may be able to fool a consumer once, but it is hard to do so long-term. Consumers are smart, and they will eventually figure out what is smoke and mirrors versus what is real.
6 Tips for How to Get Cheap Car Insurance in California
1. Compare quotes from both national and regional insurers
Comparing quotes is the easiest way to find out who has cheapest car insurance in California. Just don’t forget to include local insurance companies in your search for cheap car insurance. In California, regional insurers like Esurance, AAA, and Wawanesa might have lower rates than national companies like Geico, State Farm, and Progressive, as well as comparable customer satisfaction ratings.
2. Know what affects insurance rates in California
Everyone knows that your driving habits and claims history affect how much you pay for car insurance. But in California, companies can also consider your driving experience, marital status, and zip code when setting premiums. The car you drive, your annual mileage, and even some factors beyond your control all impact the price of insurance.
3. Choose the right amount of coverage
You need liability insurance to pay for the other driver’s damages if you’re at fault in an accident in California. Collision and comprehensive coverage, on the other hand, are optional and may be unnecessary if you own an older car. Usage-based insurance might be a better fit than a standard policy for low-mileage drivers. Going with a higher deductible or lower coverage limits costs less, too. Don’t skimp on the coverage you need, but do make informed choices. That way, you won’t end up paying for more car insurance than you need.
4. Search for discounts
Top car insurance companies in California have a variety of discounts, so almost anyone can find ways to save. You may be able to get a car insurance discount if you’re a student, veteran, good driver, homeowner, willing to go paperless, and more.
5. Stay in less expensive zip codes
Car insurance prices can vary a lot based on zip code in California. On average, drivers in the most expensive parts of California spend almost $3,000 more per year on car insurance than those living in the least expensive areas.
6. Maintain coverage while you shop for cheaper car insurance
You’ll see higher rates if you let your insurance lapse, even if you don’t own a car. California drivers who don’t maintain continuous coverage pay an average of 6% more than those with five or more years of insurance history.
