Amica Insurance - Dividend vs Non-Dividend

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Amica Insurance - Dividend vs Non-Dividend

Postby JerLon » Mon Oct 08, 2012 11:12 am

Looking at some Amica insurance plans. They have quoted me dividend and non-dividend plans for each policy. The potential 20% dividend puts their pricing just slightly better than a non-dividend plan. For instance, on my auto insurance policy, at 20% it would be $22 cheaper than a non-dividend policy.

My thought is that I will choose the non-dividend policy. I'd rather pay $22 more and know the exact price and have no risk.

Any good counter-argument?
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Re: Amica Insurance - Dividend vs Non-Dividend

Postby BornInCA » Mon Oct 08, 2012 1:04 pm

My experience with Amica is limited. I have auto, home, and umbrella with them. I'm in the process of starting my 2nd year with them as a policyholder. I go with the dividend option because there's a high probability that my premiums will be lower over time (assuming there is no increase in coverage or bad marks in our policy history going forward). I don't take their dividend checks. Instead, I request them to apply it to future payments on a monthly basis. This makes our budgeting easier. For me, the non-dividend option guarantees that I'll be paying higher premiums over the dividend option.

You may want to check out the threads below:
viewtopic.php?f=2&t=97554
viewtopic.php?f=2&t=97805
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Re: Amica Insurance - Dividend vs Non-Dividend

Postby jeffyscott » Tue Oct 09, 2012 10:52 pm

These options were never brought up to me, when I signed up with them they only quoted the non-dividend policies.

But, since the dividend is not guaranteed, I'd think take the certainty of paying $22 more over the risk of paying 20% more. (I'm assuming the $22<<20%)

What happens with the dividend if you drop them and go to a different company?
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Re: Amica Insurance - Dividend vs Non-Dividend

Postby JerLon » Wed Oct 10, 2012 1:24 pm

jeffyscott wrote:These options were never brought up to me, when I signed up with them they only quoted the non-dividend policies.

But, since the dividend is not guaranteed, I'd think take the certainty of paying $22 more over the risk of paying 20% more. (I'm assuming the $22<<20%)

What happens with the dividend if you drop them and go to a different company?


That was my thought as well. I chose the non-dividend plan. If they had a history of paying out a 30-50% dividend, I would have gone that way. But the fact that the difference was essentially the same as the dividend payment (like a $20 difference on a $1300 policy) it was worth it to me to pay a tad more for a secure price.
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Re: Amica Insurance - Dividend vs Non-Dividend

Postby ResNullius » Wed Oct 10, 2012 1:39 pm

My wife and I have been with Amica for over 33 years. I didn't even know they had non-divident policies. We've been happy campers with them.
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Re: Amica Insurance - Dividend vs Non-Dividend

Postby JerLon » Wed Oct 10, 2012 2:02 pm

ResNullius wrote:My wife and I have been with Amica for over 33 years. I didn't even know they had non-divident policies. We've been happy campers with them.


Here is what I was quoted for various policies (Dividend and Non-Dividend):

Car Insurance 250 Dividend $1,802
Car Insurance 250 Non - Dividend $1,508

Car Insurance 500 Dividend $1,654
Car Insurance 500 Non - Dividend $1,383

Umbrella 1 Dividend $107
Umbrella 1 Non - Dividend $89

Umbrella 2 Dividend $177
Umbrella 2 Non - Dividend $148

Umbrella 3 Dividend $246
Umbrella 3 Non - Dividend $206

They assumed in their "net" calculations (I don't give those here) that the dividend would pay out at 20%. This made those policies slightly cheaper although had a lot of risk in my mind.
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Re: Amica Insurance - Dividend vs Non-Dividend

Postby JerLon » Wed Oct 10, 2012 2:02 pm

FYI:

The numbers for auto are $250 and $500 deductible for 12 months.

The umbrella policies are in millions for 12 months.
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Re: Amica Insurance - Dividend vs Non-Dividend

Postby tfb » Wed Oct 10, 2012 3:22 pm

ResNullius wrote:My wife and I have been with Amica for over 33 years. I didn't even know they had non-divident policies. We've been happy campers with them.

Dividend policies are not available in all states.
Harry Sit, taking a break from the forums.
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Re: Amica Insurance - Dividend vs Non-Dividend

Postby AnimalCrackers » Wed Oct 10, 2012 4:30 pm

FWIW, I elected a non-dividend policy.
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Re: Amica Insurance - Dividend vs Non-Dividend

Postby serbeer » Thu Oct 11, 2012 2:47 pm

Non-dividend policyholder here. Was not even given dividend option when enrolled. But if given, would make the same choice since prefer sure money to likely minor discount.
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Re: Amica Insurance - Dividend vs Non-Dividend

Postby BuckyBadger » Thu Oct 11, 2012 3:40 pm

Just cashed a $400 dividend check from my $2000 auto policy.

I always seem to get almost exactly 20%.

I don't know what the non-dividend policy would cost, as I don't have that quoted to me.
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Re: Amica Insurance - Dividend vs Non-Dividend

Postby jeffyscott » Thu Oct 11, 2012 6:55 pm

Based on figures given above it appears the non dividend policies are all about around 83.5%, of the dividend policies. In my case the net savings would then be about $55, assuming 20% dividend.

I assume the payment of the dividend is contingent on claims not being much higher that expected and if they ever have a bad year they'd not pay it?
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Re: Amica Insurance - Dividend vs Non-Dividend

Postby steadyeddy » Thu Oct 11, 2012 8:23 pm

jeffyscott wrote:I assume the payment of the dividend is contingent on claims not being much higher that expected and if they ever have a bad year they'd not pay it?


Like catastrophe bonds for the common folk? I thought the point of insurance was to transfer risk, not purchase it.
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Re: Amica Insurance - Dividend vs Non-Dividend

Postby AmicaInsurance » Tue Oct 16, 2012 1:34 pm

We came across this discussion and thought we could offer some information that may be of assistance:
As you’ve stated, the dividend option provides a lower total overall insurance cost with the benefit of a dividend at the end of the year. Once your policy expires, the dividend is paid to you. We do not take claims you've filed into consideration when paying the dividend, and while they are based on the company’s past performance and are not guaranteed, any changes to your dividend policy would be made upon renewal.
While we offer dividend policies in many states, our dividend policies are not available in every state or for every line of business, which is why some customers may not receive dividend quotes.
We hope this has been helpful to you. We also have a page on our website that explains the dividend feature in more detail: http://www.amica.com/products/dividends.html. Or feel free to call us at 800-242-6422 if you have additional questions.

Note from admin alex - I've reviewed this and it is acceptable. We do not consider it solicitation when company reps confine themselves to answering direct questions about their products.
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Re: Amica Insurance - Dividend vs Non-Dividend

Postby BornInCA » Mon Oct 22, 2012 11:51 am

AmicaInsurance wrote:We came across this discussion and thought we could offer some information that may be of assistance:
As you’ve stated, the dividend option provides a lower total overall insurance cost with the benefit of a dividend at the end of the year. Once your policy expires, the dividend is paid to you. We do not take claims you've filed into consideration when paying the dividend, and while they are based on the company’s past performance and are not guaranteed, any changes to your dividend policy would be made upon renewal.
While we offer dividend policies in many states, our dividend policies are not available in every state or for every line of business, which is why some customers may not receive dividend quotes.
We hope this has been helpful to you. We also have a page on our website that explains the dividend feature in more detail: http://www.amica.com/products/dividends.html. Or feel free to call us at 800-242-6422 if you have additional questions.

Note from admin alex - I've reviewed this and it is acceptable. We do not consider it solicitation when company reps confine themselves to answering direct questions about their products.


:D Wow!! If this is posted with "admin alex" seal of approval, I take it a great sign that Amica cares about its policyholders!! I'm only in my second year of continuing my business with them (auto, home, and umbrella). This coupled with the fact the Amica is on top for homeowner's insurance based on Consumer Reports surveys.
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