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Call Kurtis: Can You Really Get $13 Auto Insurance?

The ads say you can get insurance for as low as $13, $14, $15 a month. The ads say they'll even cover you if you have tickets, a DUI or accidents on your record.

Mary Reitzell says the $17 a month insurance ad she spotted in the Pennysaver was far cheaper than the $70 she was paying. Once she got down to the insurance broker's office?

"They're like wolves on sheep when you walk in there," she recalls.

No $17 insurance was available for her. Instead she'd have to pay $80 in up front fees, then $67 a month. That was only if she lied saying she had a husband.

The Better Business Bureau's Gary Almond says few people would ever qualify for these prices. He says these ads prey on the vulnerable.

"This is really victimizing people that don't know any better; the young, the inexperienced, the desperate," Almond said.

We had two of our interns call the ads in the Pennysaver. Neither of them could get the low rates. They were quoted anywhere from $30 to $45 a month. One operator admitted few people get the low rate.

Consumer attorney Stuart Talley calls this false and misleading advertising. His firm says these companies are not buying ads to sell you $15 policies. He says the ads are meant to get you to call, so they can sell you something far more expensive.

"If 1% of the people who call get that price, that's not sufficient, it's got to be a real number," Tally said.

I asked how these insurance brokers can get away with this.

"Anybody can print anything they want. The question is who's going to do something about it," Almond responded.

The California Department of Insurance regulates the industry. Once we brought these ads to their attention, they started investigating.

"Our staff will sit down and pour through them with a fine tooth comb to see if there are any violations and if there are we will take all necessary action," Spokesperson Ioannis Kazanis said.

Mary Reitzel calls these ads a joke.

We reached out to each company with ads seen in our story. Freeway Insurance recently acquired Cost U Less. They say more than 5-thousand consumers have received coverage at the $15 rate. They add that they are perplexed anyone would think their ads are deceptive.

Speedlane Insurance and Best Buy Insurance did not respond to our request for comment.


Thank you for your inquiry regarding our companies' advertising. As you may know, Cost-U-Less was recently
acquired by Freeway Insurance. Freeway Insurance has been selling insurance in the State of California since
1987. Freeway Insurance provides insurance products to what is commonly referred to as the "non-standard"
market. This market is comprised of customers that have difficulty securing insurance and individuals that simply
opt not to purchase higher limits. These individuals are educated, smart, and part of our communities. We take
great pride in the fact that our companies have secured insurance for these individuals; where as other companies
simply avoid these consumers due to the challenges associated with this market place.
A goal of ours is to educate our consumers by explaining that insurance is not as expensive as some companies
advertise, and that given California law requires proof of financial responsibility, insurance is prudent. To that
end, we encourage consumers to understand that the cost of insurance should not be a reason to violate this law.
Rather, a purpose of our advertising is to inform the consumer that if he or she qualifies as a "good driver,"
among others, the cost of insurance is not what one may expect. It is much lower. With respect to your specific
questions, we are pleased to provide you with the following information.

When a consumer seeks our services, and in particular a quote, we obtain information directly from the customer.
Based on the information the customer provides us, we submit the information to the various insurance companies
to obtain quotes. Thereafter, we review the quotes with the customer. If the customer is a good driver, seeking
minimum limits (which is the non-standard market place), or non-owner policies, among other things, the policy's
premium costs as low as $15.00 per month. In fact, our company has secured coverage for over 5,000 consumers
at this rate. In addition, we've secured many policies with a rate slightly higher than $15.00 per month; thereby
furthering the understanding that insurance is not necessarily cost prohibitive justifying violating California law.
If we do not educate consumers as to the low rate of insurance we can provide, many consumers will pay
significantly higher insurance via competitors that do not have the requisite training or ability to place these
individuals, or by simply purchasing the wrong policies.

With respect to the establishment of the rates, it is important to understand that the rate is not set by us. Rather,
the insurance companies set these rates by filing for approval with the California Department of Insurance. The
Department of Insurance either approves the filing or modifies it. If the rates are approved by the California
Department of Insurance, we are then able to solicit quotes on behalf of our customers. The rate filings are public

We are perplexed as to any statement that the advertisements are deceptive. If our advertising is best served
with clarifying our message, we would do so. Again, it is important to us to educate our consumers about
insurance and that it can be affordable. I would like to thank you for your inquiry. It is our hope that if
confusion exists, we will have the opportunity to clarify it by being provided the requisite information.

Joe Waked

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