Review of car-insurance ads

We check out campaigns from Nationwide, Progressive, and Geico

Consumer Reports magazine: November 2012

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TV is cluttered with ads for car insurance. You might find them funny, clever—or insipid. But more important, can you trust their advice? In our 2012 Consumer Reports Annual Questionnaire, we asked 80,590 readers what they thought about several car-insurance ad campaigns, excluding their own insurer’s. Then we checked whether the claims panned out.

Nationwide's vanishing deductible can inflate your premium

Photo: Manufacturer

The claim. “We can’t make every annoying thing disappear,” says Nationwide Insurance’s new TV ad for its Vanishing Deductible program. A man’s potbelly, a plane passenger sleeping on his neighbor’s shoulder, a traffic jam, and a tattooed young man about to date a wholesome-looking girl vanish. “But we can eliminate deductibles. Nationwide Insurance members who add vanishing deductibles can get $100 off for every year of safe driving,” the voice-over claims.

Sixty percent of our readers said the vanishing-deductible ads provided useful information—the highest among the ads in the survey. But just 17 percent found them compelling enough to consider switching from their current insurer. Forty-five percent thought the ads were entertaining, and 60 percent described them as annoying.

The check.
Nationwide will cut $100 off your deductible each year you don’t cause an accident or have a “comprehensive loss,” which includes glass claims, damage from hitting an animal, vandalism, and theft. The company limits the amount your deductible can be clipped to $500 per vehicle. But it costs you money to earn the reductions. Policyholders pay $60 a year to add one car to the program; each additional vehicle costs $10, up to a maximum of $90 a year. The first $100 is subtracted from each deductible when you sign up. If you cause an accident or have a comprehensive loss, your deductible reverts back to its preprogram level, minus the $100 sign-up reduction.

Bottom line.
Eventually the vanishing deductible will cost you more than you’ll save. After nine years, for example, you will have spent $540 for a $500 reduction. You might save more by raising your deductible instead. Hiking it from $200 to $1,000, for example, can cut your collision premium by 40 percent.

Progressive tracks your driving habits

Photo: Manufacturer

The claim. A fellow complains to Flo, Progressive’s bubbly spokeswoman, that he pays as much for his auto insurance as someone who’s a worse driver. Flo recommends Snapshot, a program that tracks driving habits and adjusts good drivers’ rates down.

In our survey, 56 percent of readers said Flo’s ads were annoying, while 62 percent thought they were entertaining. Only 30 percent said they provided useful information, but 14 percent found them compelling enough to consider switching.

The check.
Snapshot is free for policyholders in 42 states plus the District of Columbia; excluded are Alaska, California, Hawaii, Illinois, Indiana, North Carolina, Tennessee, and Washington. If you sign up, Progressive will mail you a device that you plug into your car’s diagnostic port (usually found near the steering column), which transmits data to the company. You’ll receive a rate cut after 30 days if the data show that you’re likely to drive less than 12,000 miles a year, that you avoid driving between midnight and 4 a.m., and that you don’t often stomp on the brake pedal. Though the device records your speed, the company says that it’s used to calculate the number of miles you drive and that speed isn’t factored into your discount. Progressive says Snapshot could cut your premium by as much as 30 percent, though the average is 10 to 15 percent.

Bottom line.
If you’re concerned about privacy, Snapshot might not be right for you. However, Progressive says the device doesn’t have GPS tracking capability. It also says Snapshot’s data won’t be used to raise your rate. But if you don’t return the device in a timely manner, you could be fined $50.

Don’t take the Geico gecko’s word about rate savings

Photo: Manufacturer

The claim. In one of the latest Geico ads, the familiar green gecko performs a ventriloquist act using a smaller gecko puppet named Bobby. “Did you know you can save hundreds on car insurance over the phone, online, or at your local Geico office? Tell us, Bobby: What would you do with all those savings?” he asks. “I’d get a better ventriloquist; your lips are moving,” Bobby says. “Fifteen minutes could save you 15 percent or more on car insurance,” the voice-over says.

Our readers judged the gecko’s ads to be the most entertaining (75 percent described them that way) and the least annoying of the three, although 43 percent did find them annoying. Forty percent thought they conveyed useful information, and just 12 percent found them persuasive enough to consider switching to Geico.

The check.
In our survey, 30 percent said they had compared their rates with another company’s in the past year. Of those, only 11 percent said they would save money by switching to another insurer. More than 60 percent of our readers had been insured by the same company for 10 years or longer.

If you do compare prices, you might find that some insurers beat Geico. Rate comparisons published by the California Department of Insurance show that a man in his 40s who lives in Santa Cruz, drives a Honda Civic, and has no violations or accidents might pay $1,222 a year for Geico coverage, lower than GMAC’s $2,281 and $1,532 for the Hartford. But he would find even lower rates at other companies, including Allstate ($1,200), State Farm ($1,196), Esurance ($1,178), and Amica ($1,010).

Bottom line.
It doesn’t hurt to compare quotes to see whether you can get a better deal. You can check rates at multiple insurers online at such sites as Answer Financial,, and NetQuote.

Editor's Note:

A version of this article appeared in the November 2012 issue of Consumer Reports magazine with the headline "Flo, the Gecko, and Dubious Ads."

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