If you’ve ever gotten an insurance quote, you remember the lengthy questionnaire you had to fill out online or on paper. Does your auto insurance company really need to know whether you went to college or who you are married to, if your spouse isn’t going to be a part of the policy? It is an interesting question and our Maryland insurance agents get it frequently. But all this personal information you may be hesitant to give up is indeed crucial for insurance companies, and we’ll shortly explain why.
Types of Information Collected by Insurance Companies
Depending on the type of insurance you are looking for, whether it’s home, auto, life or disability coverage, you may be asked to provide some or all of the following information to obtain an insurance quote:
- Your name, address, date of birth and SSN
- Your level of education
- Type of employment, including industry and occupation
- Your income and financial health
- Which organizations you belong to
- What type of health insurance you carry
- Home ownership status
- Lat time you saw a doctor
- Your marital status and information about your spouse
- Your height and weight
- Your drinking and smoking preferences
- Your personal medical history (and sometimes your family’s too)
- Your hobbies and pastimes
This may seem like a lot of personal questions, and you are right. However, the more honest and complete answers you can provide, the more accurate insurance quote you will get.
How Your Answers Help Insurance Companies
By collecting and analyzing all this information, insurance companies are able to:
- Determine how likely you are to file an insurance claim.
- Provide you with the most fair and accurate rate based on your risk factors.
You see, insurance companies have access to vast amounts of statistical data. This data shows the likelihood of different individuals getting into car accidents, having health issues or having a house fire. For example, they may have data indicating that 45-year-olds get in fewer accidents than 17-year-olds, and people with a 4-year degree tend to drive more recklessly than people with a Master’s degree. (This statistics is fictional.) Each bit of personal information you provide helps insurance company place you in the correct group.
A single factor, like your income or education, is not enough to make a proper judgment about your lifestyle. Just because you have a PHD doesn’t mean you have excellent health or drive carefully. You might have a substance abuse problem, which makes you likely to drive under the influence in the eyes of an insurance company. That’s why so many questions are necessary for your insurance provider to have the full picture of your lifestyle and fine-tune your quote instead of broadly grouping you with other drivers. It’s important that you answer all of these questions patiently if you want to get the most precise (and often lowest) quote.
Finding Maryland Insurance Agent You Can Trust
Want to learn more about home, auto, life, business or other types of insurance? Contact Freedom Insurance today to speak with one of our agents.