Buying direct versus buying through an independent insurance agency

Direct writing companies are bragging about saving their customers lots of money on auto insurance. But we will show you why direct buying isn’t necessarily going to cost you less.

1. Advertising versus Commissions

The direct writing companies spend millions of dollars in advertising, while companies that use independent insurance agents spend a fraction of that on agent’s commissions.

2. Finding the right niche

Auto insurance companies are trying to ‘own’ a niche. Most direct writing companies are competing for the ‘ideal’ customer, a family who owns and doesn’t rent a house, preferably in a low-risk neighborhood, has an excellent driving record, more than one car, if possible all newer models. Those customers usually get a very good price from direct buy companies.

If you are not one of those ‘ideal’ customers, you will have to pay a lot more with those companies. Unless you visit an independent agent, who usually represents 5 or more insurance companies and is specialized in helping to match customers up with the right coverage needed.

3. Compare apples to apples

It’s not always as easy as it sounds. Check your existing policy against two from different companies. Be sure:

  • To match the coverage in each section, it has to be exactly the same (also the deductions)
  • To compare monthly payment rates if that’s how you pay (as annual rates will probably be cheaper, but don’t apply to you)
  • To list the same drivers and their respective driving records
  • To factor in any fees you might incur for canceling mid-term

4. Independent agents care

Most good agents will be more concerned that you get the ‘right’ coverage instead of simply getting you the cheapest price. In the long run this will give you peace of mind. Especially as direct writers don’t really provide any personal customer service and you can end up with a coverage that doesn’t match up with what you wanted. And you might learn this the hard way, should you get into an accident.


Just because a company writes direct, doesn’t mean that they will save you money, even if that’s what they promise in their advertising. Sometimes an independent insurance agency such as Homer Smith Insurance is the better choice. Think about it, and call us at 888-433-0031 or get a free quote or a coverage review. We have been serving Washington for almost 60 years, and we are also licensed for Oregon, California, Nevada and Arizona.


Your Homer Smith Insurance Team

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