June 28, 2018

Lack of Car Insurance Knowledge Linked with Higher Premiums, According to Survey from The Zebra

Survey of 1,165 Car Insurance Consumers Reveals Most Would Fail “Insurance 101”

AUSTIN, Texas — June 28, 2018 — The Zebra, the nation’s leading car insurance search engine, announces today, on National Insurance Awareness Day, research showing that drivers who know more about car insurance tend to pay lower premiums than less informed drivers.

The Zebra's Auto Insurance Awareness Survey measured the general knowledge of U.S. drivers, and the results showed a strong correlation between know-how and savings:

1. Drivers who know more about insurance tend to pay less  

Drivers who said they pay less than $100 per month for car insurance were better able to define common coverage types and terms, recognize myths, and identify factors affecting rates than those who said they pay more than $200 per month.

While the survey suggests there are real benefits for those who are more educated about insurance basics, it also illuminated a significant knowledge gap that affects the vast majority of drivers. Only 21 percent of all survey respondents would get a passing grade (D+ or higher) when asked to identify factors insurers use to determine rates.

This contradicts how drivers feel about their car insurance knowledge. Forty percent thought they were "very well informed" about car insurance.

2. Drivers don’t understand the value of car insurance—even after filing a claim

Among the 28 percent of drivers who said they filed a claim within the past year, 40 percent said they still don’t understand why they need car insurance, compared to 17 percent of all survey respondents. (And 91 percent of these respondents still consider themselves “good drivers.”)

3. Drivers who think car insurance is a scam aren’t as knowledgeable as they think about insurance

Of the respondents who said they believed car insurance is a “scam,” nearly half said they were “very well informed” when it comes to factors that impact car insurance rates. However, this group actually performed particularly poorly when quizzed about common car insurance terms and coverage factors.

For example, one in three of those who thought insurance is a scam didn’t know that they’re required by law to have car insurance, compared to one in five of all respondents.

“Car insurance is not a product like a pair of shoes or a TV. It's complex and different for every driver, so consumers often struggle to understand what kind of coverage they need, how it's priced, and what role they play in it," says Alyssa Connolly, Director of Market Insights at The Zebra. "Yet for something that provides such important financial protection, it's critical to address this knowledge gap and make sure consumers have the resources and education they need to get the right insurance coverage at the right price."

About The Zebra’s Auto Insurance Awareness Survey

The Zebra’s Auto Insurance Awareness Survey presents the findings of an online survey of 1,165 U.S. auto insurance consumers ages 18 and older. The survey was conducted by independent research firm Survata from October 4-5, 2017. The margin of error for a sample of this size is +/-3% at a 95% level of confidence.

For insurance knowledge, advice, and education “in plain English,” consumers may visit www.thezebra.com.

About The Zebra 

The Zebra is the nation's leading auto insurance search engine. With its dynamic, real-time quote comparison tool, drivers can identify insurance companies with the coverage, service level, and pricing to suit their unique needs. The Zebra compares more than 200 car insurance companies and provides licensed agent support and educational resources to ensure drivers are equipped to make the most informed decisions about their policies. It's "insurance in black and white."