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No-Charge Auto Insurance Pioneer Out to Sell More VWs, Convince Skeptics Rating Model Works
National News • February 1, 2005
Volkswagen of America, looking for ways to attract younger buyers, is going beyond sporty designs, cash rebates and zero percent financing incentives to offer car buyers, regardless of their risk ...
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| Subject | Posted By | Posted On |
|---|---|---|
| RE: How is this not rebating | Larry Lubell | Apr 23, 2007, 2:23 pm |
| bad customer service | REMONA HOLLOWAY | Apr 19, 2007, 9:57 pm |
| How is this not rebating | larry lubell | Feb 9, 2005, 5:05 pm |
| free insurance | John | Feb 3, 2005, 7:10 am |
| RE: insurance risk, credit risk, and rating models | Jared from Subway | Feb 2, 2005, 2:44 pm |
| insurance risk, credit risk, and rating models | Jared Yanowicz | Feb 2, 2005, 12:54 pm |
| Couple of issues | Oytun Palas | Feb 2, 2005, 1:24 am |
| How is this beneficial to Nationwide? | Arthur Ciszek | Feb 1, 2005, 10:59 pm |
| RE: RE: Free? | InsMgmt | Feb 1, 2005, 5:02 pm |
| Limits | Aquagecko | Feb 1, 2005, 4:47 pm |
| RE: Free? | Jimmy | Feb 1, 2005, 4:38 pm |
| Free? | John | Feb 1, 2005, 4:15 pm |
| Questions | ChrisC | Feb 1, 2005, 1:47 pm |
| Back to article | ||
Subject: RE: Free?
The younger or higher risk drivers think they are getting a deal because they are getting free insurance for 1 year, and after that year they try to get their own insurance, and the rate is so high, they can't afford it. They might be forced to sell the vehicle, and if they are upside down on the loan they are now in a pickle.
Secondly, I want to disagree with John.
They "might" include the insurance in the purchase price of the vehicle, but if you look at the sticker price of the vehicle before you buy, you would know if they are trying to increase the price of the vehicle with the insurance. Insurance varies greatly from person to person, and since VW is just looking at the vehicle themselves, and the age/sex/marital status/driving record is not looked at when they give this "free insurance" they may very well come out behind on this as well, because since they aren't charging for the insurance, they cannot get more premium for higher risk drivers.
Regardless, it's good and bad at the same time. Good, because VW will get more sales in the short term. Bad, because there most definitely will be buyers that won't be able to afford the insurance after the year of insurance, and might be dissatisfied with VW since they cannot keep the vehicle after that.
I guess we'll see what happens when that 1 year is up.