Utah Contractor Practice Exam

What is the most economical way to obtain insurance?

1. Choose one agent who handles all lines of insurance

2. Price-shop with several agents

3. Deal with only one insurance company

4. Change insurance companies frequently

The correct answer is: Price-shop with several agents

Price-shopping with several agents is considered the most economical way to obtain insurance because it allows consumers to compare prices, coverage options, and policy features from different insurers. By gathering quotes from multiple agents, individuals can identify the most competitive rates and best terms that meet their needs. This approach leverages market competition, which often results in lower premiums and better coverage. Agents may offer different discounts, and one might have tailored options that fit a specific risk profile better than another. Choosing just one agent who handles all lines of insurance may lead to limited options, as that agent can only provide the rates and products from the companies they represent. Dealing with only one insurance company can also restrict options and might not result in the best pricing. While changing insurance companies frequently might seem beneficial in theory, it can lead to difficulties in establishing long-term relationships and building a claims history, which could affect future rates.