Insurance Rates' Fates

Auto insurance is something motorists need or should have. Here in California it is required by law to have an active policy on your vehicle or one can face stiff penalties and possibly have their vehicle impounded if caught driving without insurance. As promised, I have shopped around for online quotes from some of the major insurers in the industry. All quotes were based with similar coverage levels (except as noted) and on the same vehicles with the same annual miles with drivers of equal terms on all quotes. Here are the results in alphabetical order:

Allstate: Navigating the web page was slower than its competitors. Allstate came out the second most expensive of the comparison, so I suppose their enticement of every 6 months one goes without an accident the insured will receive a discount is great, but if Allstate wants to attract new customers perhaps they should just keep the playing field level. 12-month quote = $2436

Auto Club: My current insurer. I admit there is a reason I am not only a member, but also love their insurance. I am even including my motorcycles in this quote to show how great their rates are. 12-month quote = $2368 (cars only quote = $1887)

Esurance: This company is known for their animated ads and is strictly an online insurer, no offices here in my neck of the woods at least. Their "quote, buy, print" slogan offers the maximum in convenience. As for rates, they came out in the middle of the pack. 12-month quote = $2252

GEICO: One would be willing to bet that with their celebrity-infused advertising campaign would make GEICO the priciest of the bunch. You would be incorrect in this assumption as they came out even cheaper than my current insurer, but not by much. 12-month quote = $1822



Mercury Insurance: Their think-low commercials create visual stimuli that are easy to remember. There is some truth to the campaign as Mercury resulted in the third lowest quote. 12-month quote = $1914

Progressive: Progressively more expensive than others is more like it! I even elected to see quotes from competitors, as their website allows you to do, and my quote was magically lowered for some reason. Deceiving to say the least... 12-month quote = $2452

Wawanesa Insurance: I shopped this company a few years back and decided to get a quote as a neighbor suggested, unfortunately the company doesn't believe in instant, online quotes so I am in a holding pattern. I am willing to bet, like the quote I got back a few years back, they will not beat my current insurer's quote. You see, as long as the car you drive says turbo or "GT", had more than one moving violation in the past 3 years, or drive a car that costs more than $80,000, it'll be tough to get a decent rate. Only one of the above applies and I didn't have to take a second mortgage on my house to finance it and I am a reasonably safe driver.

I didn't go much farther in my quest for cheaper insurance as I have heard horror stories about the other major companies. The results from above are surprising and affirms my original choice for insurer, hence I will be renewing my policy. Is the $60 I would save with GEICO worth making a switch you ask? Not exactly, because I received a separate quote for my motorcycles from GEICO and their rates were almost triple what I pay now with AAA. It pays to shop around!

DWD: 12, Miles: 676

Unpinching the Pinch

We are all feeling the pinch by the rising gas costs. Some employers have accommodated workers by offering flex time or allowing others to telecommute, many motorists have cut down on their trips or consolidated errand-running, and road trips are becoming a thing of the past (at least the cross-country expeditions). Come to think of it, here in tourist-rich, Southern California I see less out of state plates with the exception of yesterday when I saw an overloaded Honda Odyssey (from Illinois I think) with the roof rack filled, a hitch-mounted carrier loaded to the gills, along with the rear sagging so low that the hitch carrier was a dip away from sparking up the neighborhood and scaring a few bystanders. Next time I'll take pictures...

But let's not forget indirect ways of saving money or at least trimming in other departments to free up more cash to fuel up your vehicle. A one-stop shop with the power to save you money in so many ways: the Auto Club. Being a member has benefits, not only are the insurance rates great, so are the free maps, and towing services are also beneficial. One other aspect that I have neglected was that the AAA card is a ticket to instant savings. Here are some examples of what Auto Club members can save on: 5% off on online orders at Barnes & Noble, members save 8% on purchases of $199 and up at Circuit City, multiple savings offers at Lens Crafters. For entertainment, Southern California members can save on all their favorite teams' selected games, Sea World offers discounts, Universal Studios also offers discounts on tickets, and there are many popular tours that are also discounted for that day trip you've been planning.

I am at my renewal point with my insurance and will do a comparison of major insurers' rates to see if the Auto Club is still the best bet. Stay tuned for those results...

DWD: 10, Miles: 629
Survived a busy movie theater parking lot today w/ large SUV's parked in small spaces!!

California Countdown and Related Studies

So the countdown begins here in California (just 3 days remain) as mobile phone users will be forced to utilize hands-free devices while operating a motor vehicle. Do you think if the censors allowed this advertisement that many folks would have voluntarily bought headsets or turned off the mobile phone while driving?


Studies have been conducted at all levels from state and federal government agencies to universities and independent consultants and all have their own data, but nothing conclusive. In fact
this study concludes that a ban on cell phone use while driving will yield no significant reduction in the amount of accidents. I am on the fence on this one as surely road rage and near-miss incidents will be decreased, I have personally been nearly side-swiped by two drivers blabbing on their mobile phones and that was this past week alone! AAA conducted their own study and concluded: "All forms of cellular phone usage lead to significant increases in the establishment of non-response to highway-traffic situations and increase in time to respond." It'll be interesting to see the impact of the mobile phone usage ban here in California, I am betting that there will no almost no reduction in accident rates (more drivers and novice motorcyclists on the road equals more chances for mishaps), but will certainly increase the revenues of state and local agencies as the first fine for getting caught without a hands-free device is $20 and $50/infraction thereafter. The other revenue-maker is for stores selling hands-free devices. As for law enforcement, it's an easy catch, just look at the vehicle in front with the driver's head slightly cocked to the left or right and who's driving 5-10 miles per hour below the speed limit.

If we really want to make an impact: turn off the mobile phone, all passenger seats should disappear, remove the radio, eliminate the navigation system, get rid of cup holders (eating/drinking while driving is a big distraction), take away the armrests (your hands should be at 10 and 2 anyways), and finally, remove vanity mirrors (we don't need people shaving and applying make-up while driving). Wake up earlier for crying out loud!!

DWD: 9, Miles: 607
Parked in busy, mall parking lot briefly so wife could pick up some items from one of those markets that sell goods from around the world.

Timing and Four Squares

This is the final installment on car buying: timing. If you haven't already made that purchase there are good times to buy cars and there are not so good times. Is your current car barely running, the car making a funny rattling noise as you drive along, or do temperature extremes cause your car to overheat? Sure these circumstances put some urgency into the car buying/replacement process, but the last thing you'd want to do is let the dealer know your circumstances are dire and that your current car is in the shop. You see, you want to be in control of the buying process, that's why you got rid of your trade or are about to, the reason you took a test drive initially and nothing more, and that's why you already have financing arranged. Here are just a few ways you lose control when you make a car purchase: emotions hasten decision, current car barely running/falling apart, rushed into buying due to (fill in the blank), lack of research/preparation, and the biggest trap of all, charmed by salesperson into the showroom.

This brings me to my next point:

Source: www.consumerist.com

Ever see one of these? It's the dreaded four-square, as it's known in the auto business, and this is perhaps the best method to lose all control of the vehicle purchase. Look at all those numbers transcribed! This is where car buying gets emotional and the haggling begins.

"But I am buying from a haggle-free dealership..." you say.

I hate to burst your bubble, but even haggle-free dealerships have to bargain. As long as the four-square is brought into the equation the dealer has the upper hand. At that haggle-free dealership you still have to negotiate payments, the amount your trade is worth, etc. Eliminate variables of the four square and the buyer has the face cards/aces. The top left of the image above mentions trade (the person in this example was smart and doesn't have a trade or sold it ahead of time), score one for the buyer. The top right portion is the price of the vehicle being sold: research and that price quote come into play here, and if you have the e-mail printed with the quote, even better. The bottom left: cash down, if you already have financing arranged then this won't even need to be filled out, just show the dealer that check. And the bottom right: refer to the previous statement. In poker-speak that's a royal flush. The dealer can do nothing, but walk away from the table at this point. The opposite scenario, and most of us have been there, is the salesperson talks numbers with you, presents the figures to his his/her manager, and the charades/haggling begins. Numbers get crossed out, you get angry by their low-ball offer for your trade, numbers go through your head as you ponder the monthly payment, a permanent marker is busted out as numbers are decreased here and increased there, and then finally the sale manager comes out to shake your hand two hours later. This is what makes car-buying such a hassle and why people hate the process so much. How does this tie into timing? Well a process like this can take several hours, and being prepared like a good Boy Scout is critical here.

Other critical timing factors: buy toward the end of the month when quotas need to be met or exceeded (the last weekend of the month is ideal), avoid buying in April when tax returns entice other buyers into dealerships, make a purchase in the winter when car sales are slow and dealers are hungry for business (my previous car purchase was made 3 days before Christmas and was a pleasurable experience), and finally, if you have time on a weekday buy then to make your purchase faster (less customers means less waiting).

DWD: 8, Miles: 500

The Price is Right?

There are many websites out there offering services to get you the best price for next car purchase. Autobytel and Cars Direct are just a couple of websites that essentially perform a task you can do yourself. That job is to contact the dealership. I tried using Autobytel, which cost me nothing, but didn't see any benefit. When I bought my 2008 Honda Fit Sport, I contacted every dealership within a 50-mile radius of my home, intially by utilizing Cars.com and Auto Trader's inquiry pages which essentially get you in contact with the dealership's internet team and then I contacted a few dealerships by way of their websites again going straight to their contact/inquiry page. Fill out your basic information and within 48 hours you will either receive a phone call or e-mail from the internet manager.

You want to know a secret? The dealership that initially offered me the lowest internet price quote was the dealership in which I made my purchase. The gas prices have driven demand for subcompact cars up substantially, and here in Southern California, the Fit is particularly in demand (the dealership in which I conducted my test drive had two other customers looking at this particular model on a Sunday afternoon with temperatures soaring in the 90's). Most dealerships were not willing to go below Manufacturer's Suggested Retail Price or MSRP. Some were even tricky by excluding the $635 destination charge in their quotes which is something any buyer should be aware of. What I thought was even more insane was that a lower-volume dealer just down the street from my house was actually marking the car up $1,000. The bottom line was that my phone and internet interfaces led to 2 dealerships willing to sell below MSRP but still above invoice, this is a good thing when a model is in high demand and only the motivated outlets will play this game. Out of the two, one dealer was padding their cars/deals by throwing in LoJack (the internet manager said that they install these upon receipt), which was not included in my quote. I asked if they were expecting the car soon in the trim/color I desired but without LoJack, so I could accurately gage quotes, he mentioned it would probably take a couple of weeks. A word of caution when obtaining quotes, the phone is a great way to open the lines of communication, but unless you get something in writing, a quote can appear to be a bluff by any customer calling into a dealership, and most sales associates will say anything to get you onto their lot. If you play your cards right you can win and save thousands, but if you only have a few players willing to ante up (like in my case) it's better to play it safe. I obtained the written quote, forwarded the message to the closer dealership, and they readily took the bait. I purchased my Fit Sport w/ automatic in blackberry pearl for $275 above invoice the very next day.

One final source of great information is the Consumer Reports Bottom Line Price, which tells you what the dealership actually paid for the car and can be a great bargaining tool. The report only costs $14 per vehicle and is worth every penny. This leveraging tool can be very useful for cars that aren't in high-demand or for buyers who have the luxury of time, and the patience to get a great deal. I ordered the report, but really didn't have much wiggle room as, again, the Honda Fit is selling like ice water in the middle of a desert. A great alternative available to you for free is the Edmunds True Market Value Price, or more specifically their Regional Base Price, which was only about $130 above the Consumer Reports Bottom Line Price report's dealer-paid quote.

I've had my Fit for about a week now and have decided to include a door ding log into my blogs. You see, the car doesn't feature any kind of body-side cladding or rubber trim at all; there is nothing to absorb the impact of a careless person's faux pas or the heavy door of some full-sized SUV-driving fool whom attempts to park in a compact parking space. So the official count begins: Days without dings (DWD): 7, miles on car: 443

Stay tuned...

Car Buying Pt. 2: Trading Time & Finance

So you have that old jalopy lying around, the car's barely running, the shocks squeak, and the transmission slips more than a 4 year-old on ice. What to do? Sell it yourself or drive it to the local car lot in hopes of fetching maximum dollar. If you opt for the latter, you can be rest assured that even the most immaculate of trades will lose money. My IS 300, that I could have potentially traded, would have only netted me $8000 tops for trade-in value at the dealership. I am in the position that if I sold it myself I'd get about the same as what I owe for the car. There is nothing worse than driving off a new car from the lot knowing that it will lose 20%-30% of its value, and what's even worse is that more and more people opt to trade in a car knowing they are upside-down (owe more than the car's worth) on the loan which means that it will take that much longer to be at a break-even point. Well the 20 minutes you spend listing the car yourself on Auto Trader or Craigslist, could save you thousands and put you in a better position when negotiating at the dealership. Think of it, sure you have to spend time meeting prospective buyers and answering their questions, avoiding scams, and the occasional low-ball offer without seeing the car (I never understood this one, but I got at least 2 such phone calls). Does 2-3 weeks of this equal $2000 or more and put more leverage in your favor? Sure it does and patience and perseverance always payoff!

Once you've gotten rid of your car, the next option is to obtain financing. If your credit is decent enough you could even arrange this step prior to getting rid of our ride. Your local credit union, your personal bank, Capital One, and Lending Tree are all great sources for obtaining financing. If you opt for the latter two you can even get financed while in your underwear. Either way, arranging financing before sitting down for dealer negotiations puts the buyer in power. Being in power feels great! But before you go to the dealership with check or cash in hand make sure you do this...

Next blog: The Price is Right?

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Good Homework?!

Buying a car ranks right up there with getting a root canal for most people. The typical scenario for a car shopper is browse car lot, meet up with salesperson, test drive car, go inside showroom to fill out credit app, go through the emotional process of negotiating price/payments/amount paid toward trade (as applicable)/down payment sum, make purchase if deal is made. This was a fine process back when the internet was an information system used strictly by researchers, but times have changed and information equals power for the saavy consumer. So the first part in this blog series of buying a car is doing your homework.

As mentioned, the internet is an invaluable tool in gathering info. In fact, websites such as Edmund's, Kelley Blue Book, and Car & Driver are great places to start your search. A great print resource is the April issue of Consumer Reports which reviews all new cars and also offers great advice on good bets in the used car market. Their annual issues of both New and Used Car Buying Guides are also great resources; what is really nice about Consumer Reports guides is that they offer impartial reviews on models as well as predicted reliability on certain makes/models. There is nothing worse than bringing a new car home, only to have it brought back to the dealer service center for repair.

Another great resource is to peruse the section of Edmunds that allows consumers to rant or rave about their cars. And while these are not professional reviews, it can give you some insight into what issues you might have to deal with after your purchase and/or potentially warn you of buyer's remorse.

Once you've narrowed your focus to a few cars, for example you're looking for a mid-sized sedan and you now want to compare the Accord, Camry, and Chevy Malibu, the next step is to locate dealers in your area that carry the specific model you desire with the features you want. If you are looking for a loaded model with a V-6 and navigation, don't test drive the base model with a four cylinder and cloth interior. If you can find an auto mall with all the cars you seek in one place then that is icing on the cake, but be strict on features when test driving so you can best evaluate each car fairly. During the test drive be vague with the salesperson, do not mention trade in or numbers, just mention you're there for a test drive that's it.

After the test drive is complete, make up any excuse to not go into the showroom. Perhaps the tow truck brought you into the lot and your car is in the service bay, rent a car or get a ride from a friend, but refuse to sit down with the sales associate. Your excuse: I got to pick up my spouse/kid/significant other at the- fill in the blank, you got to go to work, etc. Whatever it takes, don't get caught in the trap of sitting to talk numbers, no matter how desperate the situation or how much you like the car, go back and do more research. You'll be glad you did...

Next Blog: To trade or not to trade and financing options

$5.00 Gas?! Whatever!

My current car (or is it my wife's car?)... our car, a 2001 Lexus IS300 has served us well over the past few years, but when gas prices here in Southern California are soaring upwards of $4.85/gallon for the premium stuff (which the car requires) it's time to reconsider our priorities. I found this awesome website that the government has been keeping secret, or maybe I just haven't invested the time to look into such resources, my internet surfing split between researching prices on VW restoration parts (I finally have the Karmann Ghia here, will post about that later) and looking up the latest reviews on the new '08 CBR 1000.


Some features of the website include being able to plug in the year/model/type of car you drive now, miles driven, local gas prices, and conduct a side-by-side comparison with cars you may fantasize about, or may even consider purchasing. After extensive research we determined we are spending about $3500 per year in fuel alone and that figure is hard to swallow as we are roughly averaging 19 miles per gallon from the thirsty 6-cylinder. Of course we researched models and choices and while a hybrid is nice, these modern-day complexities are fetching a hefty sum, even for used examples, the average price of an '04 or newer used-Prius costs about $23k (a new model retails between $23,200 and $36,900). This is insane and the gas savings don't justify the outrageous markup. After a brief testdrive yesterday we decided to purchase a Honda Fit.

Next post: Buying a car and at least appearing informed...

The Metro Investment

A few weeks ago CNN reported an article on the rising cost of gas has forced consumers to get creative with ways to beat the costs at the pump. The Geo Metro, a forgotten piece of economical transport, the laughing-stock in automotive circles for its miniscule engine, a 3- cylinder powerplant producing a whopping 55 horsepower. One eBay listing was bidded up to the astonishing price of $7600 according to the article!! The price of one of these econoboxes back in the early 90's was around $9000, by my calculations those depreciation costs put almost every car to shame including such ultra-exclusive exotics such as the Ferrari 348 (cost of new example in 1992 = $94,000, cost today, about $44,000 for nice example). The Porsche Turbo from that same year cost $118K, and a used retail example according to Edmunds would only fetch $38,000 or so (still a hefty sum for a 16 year-old car).

In fact a look at eBay showed a top of the line LSI example of the Metro going for $2900 and this listing still had two days before the auction closed. As for the features on this faded puke-yellow example: it has a tachometer, automatic, air conditioning, and a flip up sunroof. No power windows, no power locks, no remote for unlocking the doors from halfway accross the parking lot.

To put things into perspective, a search of eBay for a Ford Bronco of a one-year newer vintage yielded 6 results and the only model with bids was a loaded model (leather, power seats/windows/locks, cruise control, etc.) and the highest bid was $710! Of course when one of these gas hogs gets 17 MPG tops going with the wind, it makes me glad that I sold my Grand Wagoneer a few years back!