MAYFIELD VILLAGE, Ohio � January 12, 2004 � Ask a new car owner whether his or her vehicle has front or rear wheel drive, how many cylinders are in the engine, or where the airbags are located and they’ll tell you all about it. Ask them how much insurance coverage they have and you’re likely to get a blank stare. With more than 10 million U.S. households planning on buying a new vehicle in 2004, knowledge about one’s auto insurance should be more top of mind.
A recent national survey by the Progressive group of insurance companies (third largest auto insurance group in the country) found that new car owners know much more about the features of their vehicle than they do about the insurance that protects it, themselves and others. The survey found that a vast majority of drivers who had recently purchased a new vehicle knew its transmission type (98 percent) and number of cylinders (91 percent). Also, nearly all drivers who recently purchased a new vehicle said they knew how many airbags it had and where they were located (99 percent, respectively).
By contrast, more than half (51 percent) did not know the amount of bodily injury liability coverage they had for one person, and 62 percent didn’t know their liability coverage limits per accident.
“Buyers put a lot of thought into the types of features they want in their new vehicle,” said Tom Hollyer, product development manager, Progressive. “Yet our survey showed that many new car buyers don’t pay as much attention to their car insurance.” In fact, the Progressive survey revealed that almost one in three drivers (30 percent) didn’t know how much they paid every six months to insure their newly purchased vehicle.
�Auto insurance can be confusing,� said Hollyer. �Progressive and our agents share a simple goal � we want people to better understand auto insurance and make it easier for them to shop for and buy the product that best meets their needs.�
New car buyers should know that the make and model they choose does affect insurance premium. That�s because rates are determined not only by driver characteristics such as age and gender, but also by vehicle characteristics, which generally include the car�s make, model and year, weight, horsepower, body type, wheel base, and vehicle type (passenger car, van, pickup, SUV, etc.). To illustrate how the cost of insurance can vary by vehicle, Progressive compiled its list of the most and least expensive 2004 vehicles to insure:
|Most Expensive 2004 Vehicles to Insure||Least Expensive 2004 Vehicles to Insure|
For more information on auto insurance, comparing rates by vehicle and tips on what to ask when purchasing a new vehicle, visit progressive.com.
The Progressive group of insurance companies, in business since 1937, comprises the nation’s third largest auto insurance group and provides drivers with competitive rates and 24/7, in-person service. The companies offer insurance by phone at 1-800-PROGRESSIVE, online at progressive.com and through more than 30,000 independent agencies in the U.S. Providing stakeholders the information they need to make more informed decisions is a key company strategy. In 1994, Progressive became the first auto insurance company to provide its rates alongside the rates of other companies so consumers could easily compare and decide. In 2001, Progressive became the first Fortune 500 Company to report operating results monthly and in August of 2003 the company began reporting earnings per share monthly. The Common Shares of the Progressive Corporation, the Mayfield Village, Ohio-based holding company, are publicly traded at NYSE:PGR. More information can be found at progressive.com.
Did You Know…
According to a countrywide survey conducted by Progressive
Get Into Gear
The majority of drivers who had recently purchased a new vehicle knew its transmission type (98 percent) and number of cylinders (91 percent).
Also, 92 percent knew whether their new vehicle had front, rear or all-wheel drive, and 40 percent knew its engine size.
Nearly all drivers who had recently purchased a new vehicle said they knew how many airbags the vehicle had and where the airbags were located (99 percent, respectively).
The Price Is Right
About one in three drivers (30 percent) did not know how much they paid every six months to insure their new car, although 85 percent knew the amount of their deductible.
When asked about coverage levels, an overwhelming majority did not know the amount of bodily injury liability coverage they had for one person (51 percent), their coverage limits per accident (62 percent) or the amount of their property damage liability coverage (68 percent).
The Last Thing On Their Mind
When asked if the cost of auto insurance was a factor in deciding whether to buy a new car or which make or model to purchase, 87 percent of drivers said �no� (respectively).
Nearly two-thirds of new car buyers said they expected to pay more to insure their new vehicle (63 percent).
While older respondents (ages 55 to 64) were more likely than younger respondents (ages 18 to 24) to know the amount of their deductible (86 percent versus 70 percent, respectively), the opposite was true when it came to knowing how much they pay for insurance � the younger age group was more likely than the older age group to know how much they paid every six months (79 percent versus 68 percent, respectively).
It�s A Guy Thing
Men knew more about their new car�s features than women. Men were more likely to know their vehicle�s horsepower (41 percent versus 13 percent, respectively), engine size (60 percent versus 22 percent, respectively) and fuel capacity (87 percent versus 75 percent, respectively).
Women, however, were more likely than men to know how much they paid every six months to insure their new car (71 percent versus 65 percent, respectively).
It�s A Guy Thing, Part II
Men were also more likely to know how much bodily injury liability coverage they had for one person (52 percent versus 44 percent, respectively), their coverage limits per accident (40 percent versus 36 percent, respectively) and the amount of their property damage liability coverage (37 percent versus 24 percent, respectively).
Lacking Insurance Knowledge
Of those drivers who did not know how much they paid every six months to insure their new car, 71 percent knew its fuel capacity and 96 percent knew the transmission type.
Of those drivers who did not know the amount of their deductible, 74 percent knew the type of brakes their new car had and 56 percent knew its fuel capacity.