How Social Media Impacts Insurance Rates

Social media is so intertwined into our daily lives that you have to consider now how home insurance and social media coincide with one another. Since technology and other digital tools have become a way of life, more and more people share every aspect of their lives online. 

Insurance companies know this, so some companies have now begun to use social media to generate a potential customer’s insurance rates. This is why some insurance companies have made social media a part of their underwriting process.

It is challenging to know the exact breakdown of each insurance company’s underwriting process. Though social media provides various benefits to companies, it is safe to assume that most, if not all, use social media to monitor its clients on some level.

If your insurance provider is actively using social media to post, interact with followers, or share anything at all, the chances of them monitoring their clients are higher. 

Merely knowing what insurance companies look for can prevent you from falling victim to being charged high insurance rates because of what you posted on social media.

How Insurance Providers Deem You a “Non-Risk Factor”

We live in a digital era, and nearly everyone is figuring out how to use social media as well as how to avoid social media mistakes. Insurance companies, like other industries such as digital marketing, sometimes use decoys to get you to buy their costly services. In fact, they even have tricks to ensure you are not a risky-client. 

Initially, monitoring social media was used only when insurance fraud was suspected. Social media monitoring served as a cost-effective route for investigating insurance fraud. 

For example, say someone who filed a claim for a severe injury decides to run a marathon. When that person shares about their run on social media, their insurance company can document that as proof of insurance fraud. 

These instances are still common since social media is still monitored for this exact reason. However, now insurance specialists are tracking for more than just fraud. Here are some other ways you could be observed on your social media:

  • Your Driving Habits Texting and driving or even taking pictures while driving can be monitored on social media. Insurance specialists can identify this behavior by observing selfies taken of yourself or the road while in the driver’s seat of a car. Alternatively, they can obtain this same information if a friend posted videos of you driving distracted.
  • Sharing Your Location Sharing your current location, revealing to your followers that you are away from home, can even cause more damage than you think. If your home is broken into around the time you shared your location, an insurance company can deny any claim you file by claiming the break-in happened because of your own negligence.
  • Making Bad Lifestyle Choices Sharing pictures and videos of yourself smoking or drinking can send a negative sign to your insurer. It communicates to them that you are someone who enjoys partying hard and is potentially irresponsible. It can also lead to assumptions about you driving under the influence.
  • Relatives and Pets Have Increased or Decreased Having a spouse or even just a domestic partner that lives with you can be interpreted as you having an uninsured driver in your home. Videos, comments, and pictures can support this, and the result can be a terminated policy or an increase in your policy rate. The same applies if you have a pet and did not inform your home or renters’ insurance company about it. 

Social Media Data for Marketing and Quality Assurance

On a less creepy note, insurance providers are also using social media for other reasons than simply to monitor if you are a responsible client or not. It is also used to collect data and other information to better understand what clients need from their insurance company. 

Most companies are trying to find ways to use social media for good, which includes relationships.

Through social media engagement, the company can build deeper relationships with clients. And through more profound and more meaningful connections, they can serve better and assist its customers. This is how and why you see so many companies responding to its clients and offering service beyond just providing an insurance policy. 

How You Can Avoid Being a Risk to Insurance Providers

One of the common social media mistakes that can ruin your business brand is excessive posting, and it also happens to be a common way that social media causes people to end up having higher insurance rates. 

When you post unnecessarily and excessively, you run the chance of accidentally sharing confidential information that can hurt you in the long run. So if possible, make your social media profile private or only share certain content with specific individuals.

For people who earn money from youtube videos or blogging, try your best to avoid sharing your location. If you share your location, never share it when you are at home, so it will be more difficult to find your home address. Also, it would help to change your privacy settings simply so it automatically blocks your location.

Ultimately though, the best way to prevent surprising policy rate increases or unexpected termination, you should be honest and upfront with your insurer. Granted, you may not get the cheapest rate if you do not omit information, but I guarantee it will be better in the long run than having a rate increase or terminated because you weren’t honest about any potential risks. 

What to Do if Your Insurance Rate Increases

 If you are notified that your monthly premium has gone up, the first thing you should do is contact your insurer to find out why the rates increased. In some instances, the rate increases because the area you are in has grown more expensive. Other times it is because of derogatory information on your credit score, driving report, or something they have found after an investigation (like proof of fraud through social media). 

Once you are aware of the reason behind your insurance rate increase, you can either accept it or dispute it by providing documents to counteract the claims. You can even contact your state’s insurance commissioner if you believe your insurer is unresponsive or biased. 

However, other than faulty increases, insurance providers are pretty strict about the rates they offer unless there are discounts available. The best way to keep low rates is by avoiding becoming a risky client. Be smart about how you use your social media, and you can protect more than just your insurance rates.

Imani Francies writes and researches for the insurance comparison site, USInsuranceAgents.com. She earned a Bachelor of Arts in Film and Media and specializes in various forms of media marketing.

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