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Auto insurance: How much do you really know about your company?

In the age of Netflix and mobile devices, TV ads aren't as ubiquitous as they used to be. But the car insurance industry still spends huge amounts on commercials, trying to leverage their brands for more sales.

GEICO, for example, is widely known for its humorous ads. Its competitor Progressive also spends a bundle.

But how well does a particular company actually perform if a policyholder gets in an accident? In this post, we will inform you about a self-described Don Quixote who has created an analytics platform to evaluate car insurance companies and help consumers hold them accountable.

Injured money

The self-described Quixote is Dan Karr, a software developer who once worked as an executive in Silicon Valley. Several years ago, he was commuting to work by bike when he was hit by a car and nearly died.

Collecting on automobile and health insurance coverage turned out to be very difficult. Karr wrote a book about the battle, called "Injured Money."

To be sure, it's no surprise that insurance companies try to make it difficult for people to actually collect on policies. But it shouldn't have to be that way.

If you were injured in an accident, hiring a lawyer can help hold insurance companies accountable. A lawyer can do the wrangling with the insurer needed to pursue full and fair compensation for your injuries.

Seeking to create a better system

But what about reforming the system as a whole?

That's where Karr seeks to play not so much Don Quixote as the Pied Piper of transparency. He has used his software skills to create algorithms to analyze data on price, claim payments and customer service for insurance companies that sell auto and homeowners insurance.

The analytics are available to individual consumers through an online platform called ValChoice. It rates insurance companies by state. For car insurance, a basic report on one company is available for free. Comparisons to other insurers are available for a certain price.

The problem isn't only that insurers charge such high premiums. It is also the fact - under pressure to deliver short-term results to shareholders - publicly traded insurance companies too often try to deny or underpay claims.

Karr hopes that by making information about insurers available, it will enable consumers to choose insurers that do the best job of performing for their customers.

And that would really shake up the industry. As clever (or annoying) as those ads are, it would make more sense to empower people to make choices based on how well individual insurance companies actually serve consumers.

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