Credit checks often bring higher rates for those with bad credit.

The House of Representative steps in to change the way credit scores affect our insurance premiums.

Ever wonder why your insurance premium jumped up on your renewal, even though you had no change in your driving record? Or get to a renewal where you believe that the premium should go down, but instead goes up? Well, you may have your credit report to blame.

For years, the insurance industry has pulled credit reports on us as one of the rating factors for our insurance premiums. So even though your driving record has improved, if your credit score has dropped your insurance could still go up.

Why Are Credit Checks Used Anyway?

Insurance companies operate under the belief that people with lower credit scores are more likely to file a claim. They also believe that they are more likely to fraudulently cause a claim to help relieve financial stress.

Unfortunately, they may have a point. In 2007, the Federal Trade Commission confirmed that people with lower credit scores had double the amount of property damage claims compared to those with higher credit scores (ftc.gov).

Are Credit Checks Used Everywhere?

Nope, there are states that do not allow insurance companies to pull credit reports on the resident’s in their states. Credit checks for insurance coverage are currently banned by California, Massachusetts and Hawaii.

Oddly, these are three of the states that have the most interesting and sometimes confusing insurance laws. But if you live in one of these states, you don’t have to worry about your credit report being used to determine how much you will pay for insurance. Think of it as kind of like a reward for having to deal with all of their other insurance laws in your state.

For the rest of us, our credit still plays a part in our insurance premiums. People with better credit usually pay less than those with moderate credit, and a lot less than those with bad credit.

How Are Credit Checks Going to Go Away?

This summer the House of Representatives introduced a bill that would prevent insurance companies from being able to pull a credit report for anyone, in any state (onlineautoinsurance.com). They are trying to protect citizens from being charged more for insurance just because they were late on paying other bills.

Will it work? Not sure yet.

But if you want to voice your opinion about credit checks being used to determine your insurance premium, contact your state’s representative.

Direct Auto Insurance brings a new character and program to drivers looking for insurance.

Summary

Commercial opens with former racecar driver JJ Hightail in his Direct Auto Insurance racing uniform.

Hightail: I’ll be honest. I’m not what some might call responsible or a guy who always pays his bills on time. So maybe my credit isn’t what you’d call good at all. But the good news is, unlike other insurance companies direct auto doesn’t require a credit check.

Hightail does the finger quote thing around the words: responsible, guy who always pays his bills on time and good at all.

He does the two finger pointing thing away from him, and the words “No Credit” and “No Problem” pop up on the screen where he was pointing.

Hightail: It’s official! I guess they care more about the driver, than they do some number. Which is a huge plus because mathematics scare me. So do clowns.

“No Clowns” pop up on the screen under the “No Problem”.

Screen changes to the front of Hightail’s uniform. Under the Direct Auto Insurance logo on his uniform is “We’ll do right by you” on the screen.

Hightail: Call, click, or come in today.

Point of Commercial

Direct Auto Insurance is bringing out the news that they don’t check credit scores; which is a good play by them. Credit scores are a very sore subject with many drivers. They don’t believe that how they handle their money has anything to do with how safe of a driver they are.

By advertising this, Direct Auto Insurance is reaching out to those that don’t want their insurance premium affected by their credit score.

What They Want You to Do

They want drivers to start thinking about Direct Auto Insurance as much as the bigger insurance companies.

This JJ Hightail is a fictional character created by Direct Auto to be their spokesperson. He is no different than the GEICO gecko or Flo from Progressive.

Studies have shown advertising companies that consumers best relate to companies that have one of these fictional, character symbols in place. Did you know that Priceline brought William Shatner’s character back from the dead because of this?

So for Direct Auto, creating JJ Hightail is a good move.

My Opinion

Okay, the commercial is stupid, but not as stupid as some of the previous Direct Auto commercials, though. After watching this commercial for the 15th time while writing this, JJ kind of started to grow on me and I didn’t mind him so much. This increasing like of the character is a good thing, because I am starting to get annoyed with Flo from Progressive, and I used to like her.

Overall, JJ did leave an impression. If I was looking for auto insurance, Direct Auto would be on my list to call.

Giving this Direct Auto Insurance commercial two thumbs up.

With the 2012 Ford Escape, Ford shows us how vehicles can be created similar, but end up different.

2012 Ford Escape

The 2012 Ford Escape is another crossover SUV model that has become extremely popular with drivers recently. There are 5 different versions of 2012 Escape that include the:

• XLS
• XLT
• Limited
• Hybrid
• Hybrid Limited

All 5 versions look fairly similar, but vary in their safety ratings and insurance premiums.

2012 Ford Escape Safety Analysis

The Insurance Institute of Highway Safety (IIHS) has awarded the 2012 Ford Escape with a “good” rating in all but one category. A “good” rating is the highest rating that the IIHS provides to vehicles it has tested.

The 2012 Escape passed the frontal crash test, the side crash test, as well as the rear crash test with this “good” rating. It was the rollover test that the Ford Escape failed. Due to weak roof strength the IIHS only awarded a “marginal”. A “marginal” rating is just one step above the lowest rating the IIHS gives.

For the hybrid version of the 2012 Ford Escape, the IIHS did give it a “poor” rating, the lowest rating they offer.

2012 Ford Escape Insurance Premiums

Two of the five 2012 Ford Escape models have very low insurance premiums compared to most of the vehicles on the market today. The website Insure.com listed the 2012 Ford Escape XLS as the 8th cheapest vehicle to insure in 2012. The 2012 Ford Escape XLT was listed as the 19th cheapest vehicle in the nation to insure.

The other 3 models, including the two hybrid versions, did not make the list. Interestingly, these two hybrids are the same two that rated poorly in the IIHS rollover safety test.

2012 Ford Escape Vehicle Recalls

At this time, there are no recalls on any of the models for the 2012 Ford Escape.

An emergency recall has been declared for the new 2013 models, however. This recall is due to a component in the fuel line, and Ford has advised that owners of this recall stop driving their 2013 Ford Escape immediately. The issue is so important that Ford is telling owners to contact their local dealer, and they will transport the vehicle to the dealership for them. They do not want customers to drive these models at all until the part is fixed. (www.ford.com)

There is also a current recall on 2001-2004 Escapes due to “unintended continued acceleration”. (www.cnn.com).

Again, even though there are recalls on other Ford Escapes right now, the 2012 Ford Escape is not one of the ones being recalled.

Keeping car insurance rate low all starts with the vehicle you have.

Picking the right vehicles for the lowest insurance rates.

None of us like to pay high car insurance rates. What am I talking about? None of us like to pay for car insurance, period. Unfortunately, it is one of those necessary evils that we just can’t (legally) go without.

The next best thing then, is to pay the lowest insurance rates possible and still have good coverage. You can do this by learning which cars are least expensive to insure.

Thanks to research done by the site insure.com, we are able to provide you with a list of the 20 vehicles with the lowest car insurance rates in 2012.

If you notice, most of the vehicles on this list are family vehicles. It is a collection of minivans, SUVs and trucks. There is not a single sports car, small car, luxury car, or even a sedan on here.

What else do all of the vehicles with the lowest car insurance have in common?

First, these vehicles cost less to repair if they do get into a car accident. A good number of these vehicles also retain their value over the years, and are less likely to be declared a total loss after a serious accident. This makes it cheaper for the insurance company, because fixing the vehicle costs them less than paying the total value of the car.

Second, the people driving these types of vehicles usually have families. They are also not thrill seekers, so they drive safer and get into fewer accidents.

Note: The rates on the above charts are a nationwide average and may not reflect what you are paying if your vehicle is on the list. Your own car insurance rate may be higher or lower than what is showing on the chart.

Flo from Progressive and her team train for competition against their insurance competitors.

Summary

Commercial opens with Flo and two fellow Progressive guys walking into a room, Flo suddenly stops. In front of them are two other men, who we assume are from another insurance company.

Flo gives the “I’ve got my eyes on you” sign with her fingers to the other two men. The men respond by whipping off their professional clothes and have scary, singlet’s on underneath. Flo and her guys jump back with shock and amusement.

Both sides go through ridiculous motions of training for a competition between insurance companies. The training methods of the other insurance company are, of course, more ridiculous than the Progressive team.

Announcer: Whether it’s showing competitors rates, or striving to be number one; we’re always up for a little competition.

Training scene ends with the progressive team celebrating. Some of the guys dump a cooler of liquid on the robot Flo to celebrate and she shorts out.

Announcer: Now that’s Progressive.

Point of Commercial

Flo from Progressive and her team are being used as a visual example of Progressive being up for any challenge the other insurance companies can throw at them. They are saying that at Progressive they are always “training” to be the best in the insurance field and do better than what the other insurance companies are doing.

What They Want You to Do

I guess they want you to think that Progressive is always doing something new to be the best. There is really no other point being made in the commercial. Progressive’s contact information is showing on the bottom, but there is no request to contact them.

In fact, they don’t ask you to contact them, get a quote, or tell you that they can save you money on car insurance. They don’t really tell you how they could benefit you at all. Thinking about it, what are they trying to be number 1 in?

My Opinion

Of all the progressive commercials I have seen, this one is pretty bad. Sadly, though, it is not the worst. It feels like they are trying too hard to be funny with this one. It has none of the endearing qualities that the other commercials with Flo from Progressive.

It also feels too much like a challenge to the other insurance companies that Progressive is going to stay competitive with them. I just don’t like that it feels more like the current presidential campaign instead of telling their potential clients how they stay competitive and are the best.

Without any doubt, giving this Flo with Progressive commercial two thumbs down.