Used Car Dealers - A Tale of 2 Clients
How to keep your insurance rates low
I've found that the best way to pay low rates for dealer insurance is by NOT having registered cars listed on your policy. Instead, you should just have your dealer tags insured on your policy and only use these tags in the course of business.
Here's the story of two clients of mine - one had a bad experience, one has had a good experience:
Meet Roger:
Roger is a car dealer who has several registered cars listed on his insurance policy, in addition to his 2 dealer tags. He allows his wife to use one of the registered cars and come to find out his teenage son is using another car. Well, guess what happens? His wife suffers an accident while on a bridge. The cars in front of her have slowed down due to road construction. She cannot brake in time and strikes the vehicle in front of her. The accident is her fault. A short time later, the son is involved in a car accident while driving to school. The result is that the insurance company outright canceled the entire insurance policy.
Roger's rate for insurance tripled from $4,000 a year to over $12,000 as he had difficulty finding new insurance. The fact that he allowed personal use vehicles on his dealer insurance policy turned out to be very expensive for him.
Meet Dave:
Dave has been in business over 40 years. He's been a client of mine for 20 of them. He has 2 dealer tags on his policy and no registered cars for personal use. His personal cars (for family members) are insured on a separate auto policy. Dave uses his dealer tags sparingly, for client test drives and trips to the car auction. He has never submitted a claim to his insurance company. In looking over his insurance rates these past 20 years, they have hardly changed. In fact, he is paying almost the same price for insurance now as he was when he first bought insurance from me.
The reason? No claims submitted.
Which if the above examples have done a better job managing their business? Which one do you think the insurance company likes better?
The answer, of course, is Dave!
My point? Don't try to save a few dollars in insurance costs by having registered cars listed on your dealer policy. You really aren't saving money as the competition for insurance rates on personal-use cars is fierce. Trust me, shop around for rates and you'll be surprised. If you allow family members or friends who are not regular employees of your dealer business to drive cars that are listed on your insurance, you are doing yourself harm. This is why insurance carriers really do not allow this practice. They will cancel you or raise the rates considerably.
So, my advice is this: Treat your dealer insurance like gold! It can be the difference between your bottom line profit or loss. You can control this!
Please contact me if you have any questions. And if you would like a quote on PERSONAL INSURANCE, click here:
https://www.wallininsurance.com/request-an-auto-quote.
