Monthly Archives

March 2019

Canadian Insurance Market

Canadian Insurance Market

It’s moving online incredibly fast

As we have already seen in Banking and Investing, technological advancements for Insurance are reaping huge rewards for customers. Recent advertising efforts by State Farm and Insurance Brokers Association of Canada (IBAC) are clear indicators that online insurance options in Canada are gaining market share every month. State Farm recently launched a high-profile commercial with professional athletes and a famous actor to promote their personal touch, as online offerings powered by bots are gaining market share every day.  The IBAC started a campaign warning Canadians about purchasing insurance online and launched www.beforethequote.ca, advising to go directly to insurance brokers rather than online.

We can credit State Farm for the humorous advert and focusing on the personal touch aspect that some customers might appreciate. The IBAC has taken a different approach of provoking uncertainty and fear, the long-time insurance sales tactic, in the hope of preventing Canadians from looking online for insurance.

Billions of dollars have been invested globally into bringing insurance online with a huge focus on improving the customers experience, so we want to look deeper into the IBAC’s message and see what’s going on;

  1. Advocacy or My broker shops for me. While they can and should be, the reality is that most Canadians receive their home, auto, boat, trailer and other renewals directly from insurance companies and not from the broker. You are likely paying direct to the insurer and the renewals come direct from them too.
  2. My policy is customized.  The customization of insurance occurs long before the quote as insurers themselves have created off the shelf custom packages for home, business and auto insurance.  Insurance companies have worked hard to develop leading packages and this has resulted in very simple policies that are only subject to a relatively standard list of exclusions. The final touch to customize a policy is to ask good questions about the client, be it for business or personal insurance, which can be accomplished with online systems very easily and much more efficiently.
  3. Online insurers don’t pay claims. Online insurance is simply a different division of the same insurance company you might already be dealing with. Claims handling and behaviour from these insurance companies are going to be consistent with both channels. Buying online is not any less reliable, and it certainly does not mean that your claim won’t be paid.
  4. Online insurance is without expert advice. Online insurance industry leaders like Obvi Inc. and Zensurance have something important in common; they are brokers who provide expert advice. Customers still have access to live insurance agents or brokers who can provide guidance throughout the entire online process.  With an online chat, a customer can also ask for a transcript of the conversation to document any advice received that influenced their decisions.
  5. Lower premiums equal less coverage. It is very common for one insurer to offer the same coverage at a lower rate than another insurer. What makes the online world more competitive is how efficiently products can go to market and how claims are opened and tracked which can create substantial savings for customers. Just because insurance is cheaper online, doesn’t mean it isn’t as good if not better.

Are some people still renewing insurance in person? Maybe. Does this mean you have to buy insurance online? Not at all, but the online world is everything the traditional market fears.  It’s quick, it’s easy, it’s convenient and gives consumers the ability to effectively manage a very important product which happens to be a noticeable household expense. What kind of insurance is available online? Here are your options:

  • Home Insurance
  • Auto Insurance
  • Extended Warranty for your vehicle
  • PET Insurance
  • GAP insurance
  • Personal Umbrella
  • Life Insurance
  • Small and medium size business Insurance
  • Travel Insurance

Canada should be excited about online innovators that have re-imagined the insurance industry and the benefits available. The online insurance world is starting to open up in Canada, and it’s something to embrace rather than fear.

Should I Buy Extended Warranty on a New Car?

Should I Buy Extended Warranty on a New Car?

Whether or not you should buy extended warranty on a new car is a common question. The debate is not just whether to buy an extended auto warranty at all, but whether it is worth it for a new car.

Luckily, Obvi is here to help! Here are some things to keep in mind:

Buying at the time of car purchase versus waiting

Obvi has brought Extended Warranty and GAP Insurance fully online in Western Canada, meaning that you no longer have to buy from the dealer. Although this means you can buy at any time while your vehicle is eligible, you might want to know that it will cost a little bit less buying it straight away rather than waiting closer to the time that your warranty expires.

Also, in those few years between the purchase of the new car and the manufacturer’s warranty expiring, your initial extended auto warranty quote may become more expensive, as the rates could increase. A quote you receive is valid for 30 days.

We often get asked the question “why am I not eligible for Extended Warranty?” Usually, it’s because the manufacturer’s warranty has expired. With our busy lifestyle, it is easy to forget exactly when this expiration date is, and an Obvi policy can only be bought if you have at least 30 days of the manufacturer’s warranty left. Just so you don’t forget, you might want to buy it right away so you know you are covered.

 

Be prepared before you get the dealership sales pitch

It’s always a good idea to do some research on whether you should buy an Extended Warranty on a new car before you purchase your vehicle at the dealership. Why is that?

    • Pressure — you don’t want to be pressured into something that you potentially know nothing about once you have already decided to purchase your vehicle. After making a deal on the car, you just want to finalize the payments and leave as quickly as possible. Instead, dealing with the finance office often takes time and you can feel pressured into making a decision. When you buy anything in life, it’s not great to feel pressured into a purchase from a salesman, even if it is something you might be interested in.
    • Understanding the product — it’s very important that you understand what the warranty you are purchasing is, including the fine print. You need to take your time to know what is included and excluded in the policy, what the coverage is, what the financial implications are (are they suggesting rolling it into your monthly payments, and how much will this cost you in total?) and so on.
    • Knowing whether you got the best deal available — don’t just take the word of the salesman! Do your own research and see if you could be buying a better product at a fraction of the price.

Find out more about Obvi’s Extended Auto Warranty or GAP Insurance and get a quick quote online.

Why Would I Want An Extended Auto Warranty?

Why would I want an Extended Auto Warranty? 5 Reasons for purchasing one

We often focus on explaining why you shouldn’t be overpaying for an Extended Auto Warranty from a dealer, but why would you want an Extended Auto Warranty at all? Here are 5 reasons that we keep talking about here in the Obvi office;

1 – You could save thousands

When something goes wrong with your car, it’s really annoying – you suddenly realize how dependent you are on it! But what makes it worse is how much it could cost to get your car, and your lifestyle, back up and running.

Car repairs are not cheap, and if something goes really wrong and you aren’t covered, you may have to suddenly pay thousands to foot the bill. What happens if you suddenly need a new transmission or expensive electronic component – would you have around $4 – 5,000 or more ready and waiting? This can really add up over time too if you have multiple claims.

2 – Claims

It’s common to think that you can only make one claim, but this isn’t always true –  you can often make as many claims as you have too throughout the lifetime of your policy within your per claim and gross policy limits. This is true with an Obvi warranty.

We sometimes hear people concerned about per claim maximums; A whole engine replacement for a domestic car averages under $9,000, and its rarely the case that your entire engine and all of its components fail. The vast majority of failed component repairs cost under $3,000. If you own a very high-end luxury vehicle, major repairs can cost significantly more so you should be sure to understand what can go wrong with the vehicle and what coverages are available.

3 – Less financial worry

Instead of worrying about that potential huge car repair bill and whether you have enough money to cover it, you can sleep easy. If something goes wrong, you are covered. It’s important to do your due diligence to ensure this is the case. Make sure to understand your coverage before you buy, have someone at the provider explain the whole process, and shop around to compare coverage and prices so you don’t fall for a good sales pitch. Excellent customer service and a quick & easy claims process are important.

4 – No one-time component rule

Some warranties have a clause that you can only claim a component once throughout the life of your contract or policy. Obvi makes it clear that there is no one-time component rule per policy. If the air conditioning breaks, you get it fixed and then it breaks again at a later date, you are covered each time. This should be the case with any Extended Auto Warranty policy, but there is sometimes confusion and this is not made explicitly clear.

5 – Resale Value/Keeping it longer

Letting go of your vehicle can sometimes be stressful and difficult. You want to get the most out of the money you have already put into it. With an Extended Warranty, you can keep your vehicle longer without having to worry about expensive unexpected repairs that can come when it gets older. And if you decide to sell it or trade it in, you can get a much better price for a car that has a warranty than one that doesn’t.

It’s no longer the case that an Extended Auto Warranty is extremely expensive, and therefore not worth it. By bringing Extended Auto Warranty online and cutting out the middleman, Obvi’s Extended Warranty is a fair price, and doesn’t mean you are breaking the bank. In the event of repairs, you really could end up saving thousands by Obvi covering the repair bill.

To conclude; why would I want an Extended Auto Warranty? Save money, less worries, excellent coverage, and higher resale value. Simple!

Quotes for GAP Insurance

Where do you go to get quotes for GAP Insurance?

Traditionally, GAP Insurance was only sold through the dealer when purchasing a vehicle, so this is also where you would get quotes for GAP Insurance. However, this is expensive, the dealer is often not knowledgeable about the product and they are not the ones who would handle your claim. There also tends to be a sales pressure when buying insurance products from the dealer as they make a hefty commission from selling a 3rd party warranty (hence why buying from the dealer is expensive).

Obvi has completely changed GAP Insurance; by bringing the sales process online and cutting out the middleman, consumers can save up to 70%, there is no sales pressure and confusing technical jargon and consumers get a better product. Obvi has made the process of getting quotes for GAP Insurance quick & easy – you can get a quote in under 30 seconds!

Can you get quotes for GAP Insurance on used vehicles? Absolutely! It doesn’t matter whether your vehicle is new or used, as long as you meet the requirements;

  • You have to have a long-term loan (4 years / 48 months up to 7 years / 84 months) and a relatively new vehicle (up to 4 years old).
  • Both new and used vehicle purchases are eligible
  • Must be in British Columbia, Alberta, Saskatchewan, or Manitoba and recently signed a new auto loan or lease between $20,000 – $100,000

Getting quotes for GAP Insurance is so easy with Obvi. Whether you are at work, home or on-the-go, you can quickly get a quote on your phone without hassle. You can take your time to research and understand what the policy covers, and whether this is something for you. There is also no time pressure meaning you don’t have to make a pressured decision. Come back whenever you are ready, and we are here to help you if necessary.

How is GAP Insurance with Obvi different from buying at the dealership? Here is a handy comparison:

Dealer Obvi
Quick 30 seconds quote X
No confusing jargon X
No commission fee X
Take your time to research X
No sales pressure X
Simple list of exclusions X

The way that GAP Insurance and Extended Auto Warranty is being sold in Canada is changing. Consumers no longer have to go through the dealer to get a quote for GAP Insurance, or even make a purchase. Obvi offers GAP Insurance at a fair price by simplifying the process and cutting out the middleman. Canadians should be able to go online for GAP Insurance at their leisure and purchase an important insurance product at an affordable price.