Buy one get one free, year-end clearance blowouts and price rollbacks can be had on everything from cars to groceries, toys, clothing and food. Just about everything except car insurance goes on sale.
Even though auto insurance companies regularly compete for your business based on price, they never put policies on special sale or offer "deep discounts." And their rates never fluctuate week to week like other consumer goods.
Why is that?
Although it won't revolutionize the industry by replacing traditional car insurance policies, he says, it's a step forward in pricing policies.
States put the kibosh on car insurance "sales"
State insurance regulations are among the reasons auto insurance sales are scarce, says Bill Mills, vice president of SIA Group, a full-service insurance agency with seven offices in North Carolina.
"Every insurance company has to tell their state's department of insurance [DOI] what its car insurance rate range will be," Mills says. "Once an auto insurance company reports its rates for the year, that rate and what the company offers its customers is regulated by the state's DOI."
Car insurance companies try to price their rates competitively but essentially have to guess what "competitive" will look like in the coming months when they report their rates to a state's DOI.
"Naturally, most auto insurance carriers try to price auto insurance as competitively as possible when reporting insurance rates to the DOI," says Mills.
When reporting car insurance rates to a state, auto insurance companies generally must justify why they've set rates for specific demographics like age, driving history, geographic location and other factors.
"Once approved, those rates are the only ones that an auto insurance carrier can offer drivers," Mills adds.
State DOIs regulate pricing to ensure carriers don't price gouge.
Once a state's DOI approves a carrier's car insurance rates, the price is "locked in" until the carrier resubmits a new set of rates. That means DOI offices don't allow spontaneous changes your auto insurance quote for a seasonal sale or "clearance" because they're trying to prevent bait-and-switch tactics.
"Locking in prices prevents a carrier from offering a driver an unrealistic low premium and then raising it exponentially the following week or month," explains Dan Weedin, a Seattle-based insurance and risk management consultant with more than 23 years experience in the industry as an underwriter and agent.
"Typically, the process to adjust the rates approved by a state's DOI is a multi-week or month [process] which takes place after the auto insurance carrier has supplied sufficient evidence of need for either a rate increase or decrease," explains Jack Smith, a member of the Independent Insurance Agents and Brokers of New York and executive vice president/owner of William A. Smith & Son, Inc. in Newburgh, N.Y.
Each state has its own approval process for car insurance rates, which in some cases can drag on for months -- making "sale prices" impossible.
Do you deserve a car insurance sale?
"Discounts are a form of a 'sale price'; however, discounts are only available for drivers with good driving records, credit scores over 650 or more, a history of prompt payment, previous claim history, etc. Discounting all auto insurance rates for everyone . . . is just asking for big trouble for insurers because they stand the chance of losing too much money on those policies" if the drivers make claims, says Weedin.
If you think you deserve a discount because of your driving record, your low annual mileage, the time you've been with your insurer or other factors, don't be shy about asking, advises Weedin.