I recently bought a tennis racquet online. I priced it out on tenniswarehouse.com, then bid on the same racquet brand new on ebay. I have not gotten it yet. I hope it works out. If it does, I saved about $30.00.
Obviously more of us are conducting business online. This extends to insurance purchases, including casualty insurance and motor vehicle insurance. Companies like Geico and Progressive operate online and in person.
But what does this mean for the consumer? Certainly purchasing auto insurance policies online means you’re going to get less information in the application process than you would by speaking to a reputable insurance agent from whom you could at least ask questions about your insurance needs, including the necessity of buying uninsured motorist coverage(UM) underinsured motorist coverage(UIM), and the difference between limited tort, and full tort. If you’ve been to my web site, or read my book, you would know that UM and UIM, although not mandated by Pennsylvania law, are absolutely necessary coverages to protect you and your family from uninsured and underinsured drivers. You would also know that limited tort is basically worthless coverage, and that the only smart choice is to purchase full tort coverage.
But in order to “waive” your ability to purchase UM and UIM, and in order to “waive” your rights to full tort coverage, Pennsylvania law requires that you sign “waiver forms.” Otherwise your selections for less comprehensive coverage may be able to be invalidated. Recently enacted laws do hold that electronic signatures are valid. But the Pennsylvania law which controls the purchase of automobile insurance specifically requires signatures from the insured so that a knowing waiver of a prospective insured’s rights are validated. Therefore, although Geico and Progressive may be finding it more economical and, in fact, more profitable to be selling online, they may be opening the door to their insureds’ challenging the validity or lack thereof of less expensive insurance coverage purchased online because of lack of proper signatures.