Practically everyone has seen the ads on TV in which a cute gecko promises to save you money if you apply for their cheap car or motorcycle insurance. Yet, is it true that you will save money, or is it just more marketing subterfuge put on by a silver-tongued Madison Avenue ‘suit’?

A couple years ago, the insurance industry began offering free online price quotes, Not long after, literally hundreds of insurance companies have jumped on the bandwagon to promote their own cheap car insurance. They follow through with this by comparing their rates in contrast to other providers and implore you to buy their cheap car insurance.

However, is it possible for every car insurance company to actually be the cheapest? Still, there has to be a high-priced company in order for there to be a cheapest. Therefore, there has to be a reason why so many companies can claim to have cheap car insurance.

Insurance actuaries utilize large amount of statistics to arrive at a cheap car insurance premium that is appropriate for a certain class of driver, and each individual insurance company has different criteria for each class of driver. The various classes of drivers inherently has a likelihood of filing a claim due to a covered occurrence, and simply by writing more policies to lower-risk drivers, they are then capable of offering less costly insurance to high-risk drivers. Accordingly, this permits some insurers a large variance in the capacity to offer cheap car insurance.

For example, Company Y writes 72% of their insurance to middle-aged (low risk) drivers. Since the number of claims filed by this particular demographic class is extremely low, they can well-afford to write a portion of high-risk (males 18-25) policies for less than some companies who write only high risk policies. The insurance company will solicit drivers in that high risk demographic to secure their business as a new customer. Though the overall discount might be less than 15%, the consumer is glad to get a cheap car insurance rate from a respectable company and the company is glad to have a new customer.

It is improbable an insurance company will disclose their statistics or demography employed for formulating insurance premiums, for that very reason it is important to comparison shop for a cheap car insurance quote. Checking more than one online quote source will ultimately lead to a result of a quote that is within your budget. The caveman or lizard may not save you as much as your good neighbor, so be sure you are in good hands by comparing several online companies to get a cheap car insurance quote.

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