Meet Esurance: the Series

In spite of our dot-com heritage and tech-savvy ways, Esurance is still a company comprised of living, breathing, very smart, problem-solving people. Meet the talented men and women who work tirelessly behind the scenes and discover what really makes us tick.

Meet Erika V., sales support lead
Find out what drives this enthusiastic sales rep both in the office and on the ice.

Meet Casey S., network manager
This guy was made for his job. Hear his story and find out why he’s such a great fit here at Esurance.

Meet Nandini E., director of systems engineering
What drives the great minds behind Esurance’s innovation? Drive, talent … and a little bit of junk food.

Meet Erin H., customer service rep
Find out why this helpful customer service rep gets to wear her fuzzy slippers to work.

Meet Derek M., licensed customer service rep
Esurance expert and Ben Affleck lookalike — find out what makes Derek such a superstar.

Meet Katie F., sales and customer service trainer
Where do Esurance experts get their expertise? It often starts with Katie, sales trainer extraordinaire.

Stay tuned for more Meet Esurance videos!

What Happens to Totaled Cars

A vehicle is considered a total loss when it would cost more to repair it than replace it. On average, approximately 20 percent of all Esurance claims result in a total loss, although this number will increase after an event like Hurricane Sandy.

But what happens to all these cars after they’re totaled? Are they put out to pasture, demolished, salvaged, rebuilt? Well, yes. The process for dealing with a total loss vehicle is complicated and varied, so we talked with Esurance claims manager, Jason Giles, to get some solid answers.

How is a “total loss” determined?

After you’ve been in an accident, an expert — known as an appraiser — will perform a complete inspection of your vehicle to determine how much it will cost to repair. If the repairs would cost more than the cost to replace your vehicle, they will deem it a “total loss.”

What happens to totaled cars?

Once your vehicle’s determined to be a total loss, your insurance company will settle with you, meaning they will pay you the fair market value of your vehicle. The vehicle will then be taken to a salvage yard and the title will be processed based on that state’s regulations.

It’s important that the title is processed according to state-specific regulations. Doing so will ensure the car doesn’t return to the market with a title that (conveniently) fails to mention previous damages. Esurance partners with Copart, a trusted salvage vendor that works with local DMVs to make sure totaled vehicles are only sold on salvage titles.

How is a salvage title “washed”?

Despite our best efforts to keep totaled vehicles off the market, there are times when unscrupulous people try to make a quick buck by “washing” the title. This is done by moving the salvaged vehicle to a different state and applying for a new title in that state. Because regulations vary, it’s possible to get a title that’s different from the one in the old state. Hence, a “salvage” title becomes a “clean” title.

How can I avoid buying a totaled car?

The good news is that even if the title’s been washed, you can still research a car’s history through its Vehicle Identification Number (VIN). Because Esurance reports each claim through ISO (Insurance Services Office), it becomes permanently associated with the VIN. By running the VIN through a company like CARFAX, you can feel confident that all claims associated with the vehicle will appear.

That’s why it’s essential to always check the VIN before buying a used vehicle, regardless of what the title says.

Cars totaled by Hurricane Sandy

Due to the high volume of flood-damaged cars after Superstorm Sandy, the number of totaled vehicles has increased substantially this year. According to the Huffington Post, nearly 250,000 vehicles were destroyed in the storm. And while it may be months before all these cars are processed, some could find their way back onto the market … and, in some very rare cases, may even claim to have “clean” titles.

If you’ll be shopping for a used car, be extra careful to do your due diligence and check the VIN. It could save you a world of trouble and expense!

The High Cost of Driving Part 2: How Futures Markets Affect the Price of Gas

Last week, we discussed how the law of supply and demand and world events affect the price of gas. But, as we noted then, those aren’t the only pieces of the gas price puzzle. Today we’ll look at a third force: futures trading.

As the graph below shows, the law of supply and demand isn’t sufficient to explain fluctuations in gas prices. Since 1980, demand has risen steadily, as has production (though U.S. production currently outstrips demand). Of course, the U.S. isn’t the only country in the world. Demand’s a worldwide phenomenon, and emerging markets like China have a sizable impact.

Gasoline onsumption, production, and price 1980–2012
Click to enlarge!

Yet the cost of gas has been erratic. That’s partially due to the wars and natural disasters we discussed last week. But there’s another big reason for fluctuating gas prices: speculation.

Futures trading: gas pricing happens on Wall Street

Speculation is now part of the DNA of oil prices. You cannot separate the two anymore. There is no demarcation.”

—Fadel Gheit, analyst at Oppenheimer & Co.

A more recent entry in the debate over what really drives gas prices through the roof is futures trading. And it’s an argument that’s gaining a lot of steam due to oil corporation head honchos and outspoken politicians.

What exactly is futures trading?

Futures trading is a type of speculative economic transaction in which a seller strikes an agreement with a buyer to deliver an agreed-upon quantity of an item at an agreed-upon date in the future. The buyer hopes that a product’s price is going to increase by the time of delivery (making the past purchase a savings), while the seller hopes that it will decrease (making the past sale a bigger profit). The factors driving buyers’ and sellers’ hopes are varied, but current events — and presumptions about events to come — play an important role. And that explains why the very murmur of any potential war in the Middle East can drive serious increases in price.

In a May 2011 Congressional hearing, Exxon Mobil CEO Rex Tillerson acknowledged financial speculation’s power in determining gas prices. In fact, according to the New York Times, Tillerson suggested that as much as 40 percent of the current high cost of oil arises from speculation. At the time, Tillerson said that, “If you were to use a pure economic approach, the economist would say … [the price per barrel’s] going to be somewhere in the $60 to $70 dollar range.”

That week, the actual cost was about $98 a barrel.

The extra $30–$40 is pretty significant when you consider the current average cost of extraction is just $11, on average.

Gas is the lifeblood of the American economy

It’s important to realize what a key role gas plays in the health of the American economy. For many Americans, driving is less of a choice than a necessity, and having to plunk down $60 to fill the tank can make the thought of other purchases less savory. In other words, big spending at the pump means little spending … well, everywhere else. And the less consumers are spending, the less money is getting pumped into the economy.

Thankfully, there are many ways for you to save at the pump and still give the local economy a shot in the arm. You could use our online tool, Fuelcaster, to keep an eye out for better prices. Or try riding a bike around town, taking more walks, or hopping on the bus. Or better still, take a look at some of these gas-sipping cars.

Related link

Learn how supply and demand and world events also influence the price of gas.


Top 5 Traits of a Designated Driver

Thanksgiving 2012 is just hours away and the holiday season is well upon us, so it’s time to talk turkey — not the Butterball, stuffed, and roasted kind — but about an important holiday essential … designated drivers.

If you’re like 51.8 percent of Americans  who like to have a drink or 2, chances are your celebrations could include no small amount of “holiday cheer.” But before you dip into the eggnog or spike the punch, it’s important to know how you (or your guests) will be getting home at the end of the evening. Which brings us to those unsung heroes of every party: designated drivers.

But who are these selfless souls who sacrifice sangria for sobriety and promise to get you safely home? It might be your better half, your mom or sibling, or your BFF. In fact, your DD could be anyone with a drivers license, a little patience, and a whole lot of awesomeness.

What exactly does this awesomeness entail? Let’s take a moment to break it down.

What is a designated driver?

As someone who volunteers to chauffeur merrymakers to the party and back, whilst avoiding the holiday spirits, the designated driver is first and foremost safe, sane, and SOBER. Aside from these enviable qualities, here are the top 5 traits of designated drivers.

1. A DD knows how to drive

Since “driver” is just as important as “designated,” DDs must, obviously, have a drivers license. Bonus points if they also have a car with no major mechanical issues and fully functioning taillights.

2. A DD has a high tolerance (for the absurd)

Okay, we’ll be honest here. Spending the evening with a group of revelers can be trying. Between convincing their friends to put their pants back on and going along with a bevy of harebrained schemes (”Sure, swimming in the fountain sounds great”), designated drivers have to put up with a lot.

3. A DD is prepared

When you’re tasked with chauffeuring a carful of rowdy revelers, common sense says that you better be prepared. It should come as no surprise, then, that DDs are ready for anything … from Celine Dion singalongs, to midnight drive-through runs, to quick stops on the side of the road (when car rides and cocktails don’t mix).

4. A DD boasts supreme focus

Friends are fun. Friends who’ve had too much eggnog, on the other hand, can be somewhat distracting when you’re trying to drive. But a good DD, like every superhero, possesses superhuman focus. Undeterred by the most audacious feats (ahem, mooning out the window?), the designated driver keeps calm, drives on, never once taking their eyes off the road.

5. A DD is endowed with a huge sense of humor

Anyone who willingly volunteers to drive partygoers after an evening of excess must obviously have a healthy sense of humor.

Celebrate the designated driver

This holiday season, Esurance is celebrating designated drivers. If you’re on the market for a DD or owe thanks to one, check out our Facebook tab for shareable please and TKU cards. It’s easy. It’s fun. And who knows, it could be a lifesaver.

Happy Thanksgiving 2012

AAA projects that 43.6 million will travel over Thanksgiving weekend. Wherever your celebration takes you this season and however you plan on getting there (whether by car, train, plane, or foot), we wish you and yours safe travels and a delightful Thanksgiving.

Related links

How a DUI affects car insurance premiums
The cost of a DUI

The High Cost of Driving: Why Gas Is So Expensive

If you drive, you’ve no doubt wondered why the cost of driving is so high … probably every time you fill up.

And if (like us) you’ve ever researched the forces behind high gas prices, you’ve undoubtedly found a ton of proposed reasons for the occasional spike. But how do you know which, if any, to believe?

We thought we’d review some of the most popular opinions on why the cost of gas is so high and cite some expert opinions on each.

Wars, natural disasters, and other catastrophes drive gas prices up

How world events affect gas prices
Click to enlarge!

Of all the explanations for high prices at the pump, this one’s a perennial favorite. And when you compare fluctuations in gas prices to the timing of major world events, it’s hard to deny that there must be some kind of connection.

In the graph above, it’s clear that several world events may have contributed to rising gas costs. The beginning of the Iranian Revolution in 1978, for example, might have had a lot to do with the slow but precipitous spike that culminated just before and after the beginning of the war between Iran and Iraq.

The months before 1991’s Operation Desert Storm saw another, though more modest, spike. Additionally, the U.S. war with Iraq, hurricanes Katrina and Rita, and the recent Libyan revolution have each caused their own sharp jumps.

But other events, like when the Organization of the Petroleum Exporting Countries (OPEC) scaled back production in 1998, seemed to do little to change gas prices. And that leads us to another popularly cited cause for high fuel prices.

Gas prices are determined by supply and demand

Supply and demand for gas
Click to enlarge!

The law of supply and demand is fundamental to economics, and it’s at work in determining gas prices: simply put, the relationship between the amount of an available resource and the demand for that resource determines the resource’s price.

In other words, when supply is high and demand is low, the price is low. As demand rises and supply falls, the cost goes up. And if demand should ever surpass supply, the costs will skyrocket.

At present, there’s no reason to anticipate a significant drop in demand for gasoline. Demand’s been rising quickly and steadily since the early ‘80s, despite ongoing shortages of drilling platforms, engineers, refining facilities, and even oil fields themselves. The U.S. military’s 2010 Joint Operating Environment (a report that outlines potential national security threats), predicted that “as early as 2015, the shortfall in output could reach nearly 10 million barrels per day.”

So, as demand continues to rise and supply drops, we can expect further increases in price in the coming years. Which is one of many reasons some people are so excited by new sources and methods of extraction like shale gas, bio-energy, and hydraulic fracturing (often called “fracking”) — all of which could make the United States energy self-sufficient by 2035. Others, however, warn that the dangers of fracking are no better than those related with more traditional oil extraction methods.

Next week, in Part II of our “Why Gas Is So Expensive” series, we’ll check out how futures trading can affect what we pay at the pump. Read Part II now.