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Finding Cheap Group Auto Insurance

Finding cheap group auto insurance is a challenge for many business owners and leaders of civic organizations and other groups trying to add value to group membership by offering members this great option. Group auto insurance is essentially a way for insurers to offer lower prices to individual drivers by spreading out risk across the group. They can save money for group members because their own costs are reduced by administering policies in a large group setting. Many different providers sell these types of plans, but eligibility rules and restrictions may differ from company to company. Learn all you can about this excellent option and see if cheap group auto insurance is right for your organization.

Car Insurance Group Coverage Explained

Group auto insurance is a special benefit available for companies, organizations and clubs who wish to bestow extra privileges on their members. This arrangement benefits both the providing auto insurance company and the individuals in the organization who make up the membership. Auto insurance companies can offer reduced average rates for members because they are able to spread out risk across the entire group. Therefore, higher risk drivers who have an injury accident, for example, might not see their rates increase as much, and rate increases in general might be less likely in individual cases thanks to the way risk is spread out.

Car insurance providers save money on their own costs in administering these policies in a few different ways. First of all, they are able to essentially complete group sales so their marketing efforts bring a larger return on investment. And second, creating and adjusting the terms of these plans is less costly because it is done less frequently thanks to a greater ability to assign risk across membership.

Individuals who participate in these plans also benefit for various reasons. Business owners and organization leaders get a great added perk they can add to attract and retain top people. In most cases this can be done at no cost to the organization. One of the great benefits to whole groups is the way this kind of perk can enhance membership in a group or employment status in a company. And likewise, insurance providers benefit because they get to administer policies in chunks of people rather than strictly to individuals. This relationship saves both parties money at the same time.

Why Groups Can Save Money

Groups participating in auto insurance in this manner can save money because as stated previously, the insurance provider is able to spread risk out across the organization and also save money on administrative costs, and those savings are passed on to the auto insurance group. If any single eligible and insured member has issues with his or her driving record, the effects of those issues are not as pronounced on that individual policy.

But that does bring up a certain disadvantage to this type of auto insurance policy. The fact that risk is spread out across the entire list of insured members means that those who have great records may actually pay more for insurance than they would on their own. Accidents and other major claims by other members might affect the prices paid by those who rarely or never file claims. So this sort of setup is clearly not advantageous to every single eligible driver. Each person who is offered membership should evaluate the cost against her own coverage and decide accordingly. Fortunately these agreements normally do not require every eligible member to take part, so there is usually no pressure to enroll in auto insurance just for the sake of the group.

Great Values for Your Organization

All in all, in spite of its few possible shortcomings, group membership in auto insurance protection is a great option for many organizations. In a lot of cases it saves both groups and eligible individuals money on the rates they pay for coverage versus what they would be facing without such membership opportunities. As a business owner you can give your employees extra incentive to stick around and reward them for their hard work without setting yourself back financially. As the leader of an organization, you can add distinct value to organizational membership and encourage participation by giving outsiders one more possible reason to join, and providing insiders with solid logic for keeping with the program.

Finding cheap group auto insurance might not be the easiest task in the beginning. There is sometimes a good bit of legwork involved in finding the right plan and getting members enrolled initially. But once things are set up, maintaining a relationship with your provider is easy. The insurer's representative does most of the work. Interested parties should look at this as one more way to add value to their organization or company.

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