How could it possibly be bad news that customers are happy with their insurance? Doesn’t that mean that the insurance providers are doing a good job? Providing good service? After all, this information comes from consumer reviews!

It’s really not bad news exactly. Unfortunately, the news that came along with it is that rates are going up.

Consumer Reports found that 86% of customers are highly satisfied with the way that the 22 largest insurers have handled claims for their cars. The study surveys nearly 30,000 people who had filed claims between January ’06 and June ’09. Claimants responded with a number score between 0 and 100, 100 being the most satisfied of course. Roughly speaking, the study said that 60 was fairly satisfied, 80 was very satisfied, and those who responded with 100 were completely satisfied.

It is no secret that the insurance game can be a very expensive one, as it is one of the most lucrative industries in the world today. When it comes to car insurance however, it can be difficult to decide what insurance company is right for you and your family. When you are looking for car insurance, you want to find a company that offers you a number of benefits at the price you can afford. But what are those benefits exactly? Often enough people just look for the lowest price, but this may cost you down the road. When you are doing research on car insurance companies, you want to make sure they offer you the benefits that you will need that will protect you in the event of crisis. Here we will discuss exactly what those benefits are, so you know what to look for when you are trying to get the best car insurance policy.

A high payout frequency is the first benefit you want from an insurance company. What this means in laymen’s terms is that you want a company that isn’t going to give you a hassle if you ever need to make a claim. Insurance companies make money on insurance premiums, and they lose money on insurance claims. So they try to increase their number of policies and decrease their number of claims to pay out to ensure they maintain a profit. This may not be good news for you when you are looking for car insurance. When you are researching your companies, you want to find a company that has a high payout frequency. What good is a car insurance policy if they are going to make your life difficult during the claims process?

One of the more interesting features of insurance is the degree of trust the insurer shows in what you say. Unless you are asking cover for something expensive and unusual, no insurer is going to ask to see whatever it is. You are allowed to add the vehicle or top-of-the-range electronic gizmo to the policy without question. But, if it later turns out you were less than honest, the insurer is allowed to cancel the policy and leave you without any cover. So the insurer is always protected and you pay the price of facing any claims without a policy to pay. Yet, while this has been standard in the insurance industry as a whole, there’s been a reluctance to trust drivers to report their mileage honestly. Younger people claiming unusually low annual mileage have been greeted with skepticism. To qualify for a discount, people have been forced to drive to the local office of the insurer to have someone verify the odometer reading once a month. This has been inconvenient and not so many people have taken up the discount offer.

With new technology, all this is changing and insurers are now moving into the pay-as-you-drive market with more enthusiasm. In part, there are also environmental reasons for this change. No matter what you think of the climate change debate, there’s no doubt more cities are being affected by smog. So whether this is big picture or the number of people lining up with asthma attacks at the local emergency rooms, there’s a move to encourage people to drive less. Accompanied by improvements in the mile-per-gallon performance of new cars and better emission controls, there’s now hope the air will stay breathable for longer. The pay-as-you-drive option gives people a direct incentive to drive less. Fewer miles driven means fewer accidents. If the full technological capabilities are introduced, it will also be possible to monitor whether drivers keep to the speed limits. Any vehicle reported stolen can automatically be tracked and recovered.

The National Highway Traffic Safety Administration (NHTSA) carries the basic responsibility of ensuring the majority of vehicles on our roads are safe. This is the FDA for vehicles, but like food and drugs, it only tests at point of delivery. If you fail to look after the vehicle, that’s your problem. So, if you go over to the safercar site, you will find the 5-star safety ratings for all the crash and rollover resistance tests. The NHTSA also liaises with the manufacturers to decide when there should be recalls to fix design defects. In theory, this gives you protection and ensures all the new vehicles coming on to the roads will be safe to drive. All this work of formal testing is, of course, watched by the insurance industry with interest. They prefer people to drive safe vehicles. Thus, the premium rates carefully match the safety test results from the NHTSA. If you buy a small vehicle that’s likely to crumple on impact and trap you inside, this means more claims for driver and passenger injuries. Equally, if you drive something designed to crumple on impact to absorb the energy from the crash and so protect those inside, this is likely to mean your vehicle will be uneconomic to repair – again something that makes the claims more expensive. Essentially, the insurers prefer you not to crash. But if there’s no avoiding it, you should be driving something that protects you and resists damage.

Many insurance providers use the customer’s credit report as an important variable when calculating future premiums. So you should definitely keep that in mind when looking for a new insurance policy, because there will be a lot of people looking into your credit report and analyzing all those credit lines and due bills.

The reason for this is that it was statistically proven that there’s a direct correlation between a person’s credit rating and the probability of the person to file an insurance claim. Auto insurance providers can predict the behavior of any given customer to a certain degree just by seeing their credit report. And it’s better when it’s good enough.

Sure, it doesn’t mean that other important factors won’t be taken into account. Your car insurance provider will consider the car make and model, your sex and age, driving record, your location and other important variables that will influence your premiums. So if you don’t have a credit record yet, don’t worry about getting bad premiums since there are other ways to determine how much you will pay for car insurance. In fact, for some car owners this would be a better option if they don’t have a very good credit rating.