Report: Initial quality stellar among vehicle brandsJ.D. Power and Associates says initial quality rankings have improved and are more widespread. Read More >> |
NICB lists top cities for vehicle theftsCalifornia is home to seven of the 10 cities with the highest vehicle theft rates, says NICB. Read More >> |
Economic growth, low gas prices may boost auto sales this summerThe National Automobile Dealers Association says the combination of reduced gas prices and higher inventory levels will bring more car buyers. Read More >> |
Teenage driving deaths peak in summer months, says reportA new report prompts safety officials to designate May as National Youth Traffic Safety Month. Read More >> |
President Obama promises to buy Chevy VoltDuring a UAW speech, President Barack Obama discussed auto industry's recovery and his affinity for GM's electric offering. Read More >> |
General Motors surpasses Toyota as world's best-selling auto brandGM saw sales increase nearly 8 percent, outpacing former leader Toyota by 1.5 million vehicles sold. Read More >> |
Pay-as-you-go insurance increases in popularityMany motorists are trimming their expenses by purchasing auto insurance policies that are priced based on how often they drive. Read More >> |
Flying car receives special exemptionsTerrafugia's roadable aircraft receives special exemptions from safety standards. Read More >> |
Gas saving tips: Separating fact from mythSome popular gas-saving tips may no longer be relevant for many motorists. Read More >> |
Carpooling can save Americans time, fuel costsEdmunds.com suggests establishing solid guidelines with friends or coworkers before starting a carpool. Read More >> |
Simple tips for used-car sellersHave an old car but don't know how to sell it? Edmunds.com offers tips that can help sellers make their used car more appealing for buyers. Read More >> |
Travelers of Chicago highway prepare for gridlockOfficials and travelers agree that Chicago’s Jane Addams Highway needs the maintenance, but motorists are dreading the delays expected. Read More >> |
Is now the time to buy a new car?Industry experts are split on whether now is the best time to buy. Read More >> |
Optional coverage essential to cover seasonal hazardsThough springtime melts away snow and ice, alleviating certain driving hazards, the season also comes along with its own weather-related road dangers. Read More >> |
Simple steps can help parents find affordable car insurance for teensGood grades and driving a basic but reliable vehicle are two steps that can lower auto insurance rates for student drivers. Read More >> |
Reckless habits may lead to higher auto insurance rates for womenStatistics show women are usually safer drivers, but some reports suggest ladies are beginning to pick up some bad habits. Read More >> |
Combining car insurance after marriage, cost-saving or costly?Just Married? Newlyweds should consider the pros and cons of combining their car insurance Read More >> |
Saturday, October 6, 2012
Auto Insurance News
Compare insurance costs before buying a new car Read more: http://www.foxbusiness.com/personal-finance/2012/10/03/compare-insurance-costs-before-buying-new-car/#ixzz28YP6kOoN
Question: I'm shopping around for a new car. Which car costs the most to insure: a Dodge Avenger, Mazda3 or Mitsubishi Eclipse?
Answer: I'm a big advocate of shopping around for auto insurance as part of the research one does before buying a car. If you wait until you've decided on one certain car, or worse yet, already purchased a new vehicle, you may find out your auto insurance premiums will make your choice of car no longer affordable.
The process will give you a big picture of what various cars will cost to own. (See “How to insure a new car
”) You may find that the difference between the cars is small compared with the difference between insurance companies.
I ran car insurance quotes on a Dodge Avenger, Mazda3, and Mitsubishi Eclipse for a 30-year-old male living in Houston (your geographical location makes a big difference) with a clean driving record.
I chose liability limits
of 50/100/50, which breaks down to $50,000 per person and $100,000 per
incident for bodily injury liability and $50,000 for property damage
liability. Since these are new cars, I also added physical damage
coverages of collision and comprehensive, each with a $500 deductible.
The 2012 Avenger was the cheapest of the three vehicles to insure with an annual rate of $1,422. The 2012 Mazda3 was second with an annual auto insurance premium of $1,534, and the 2012 Mitsubishi Eclipse was the most expensive to insure per year at $1,656.
But look at how much comparison shopping
really matters. The quotes for the Avenger ranged from $1,422 to
$2,088, for the Mazda3, from $1,534 to $2,518, and for the Eclipse,
$1,656 up to $2,516.
Finding the auto insurance provider that is pricing competitively for your set of rating factors is important since, as you can see, the difference in cost can be hundreds, if not thousands, of dollars. (See “Save $1,102 just by shopping around”)
Certainly the car can make a difference. If a car is stolen more often or has higher repair costs -- that is, if the car has more frequent or larger insurance claims, -- then it will cost more to insure than a similar car with lower claims frequency or cheaper parts. (See "How a car gets a bad reputation.")
But the vehicle is only a small component of a very long financial equation. Where you live, your occupation, marital status and other things that insurers see as risk factors will change your rate from the sample I've given here.
You can easily compare rates for yourself, using your own information, with CarInsurance.com's rate-comparison engine.
You can find rates on the first car you're considering, then click the
Review button at the top right of the rate screen The menu that opens
will allow you to change any of the information you have already
entered, such as the vehicle, and get an updated quote.
And you can always edit other items to see how they change your rate quote. Raising your deductibles (see “Will higher deductibles save you money”),
lowering your liability limits, and so on within the car insurance
quoting form will change how much your auto insurance premium will be.
Just make sure what coverage you choose is right for you, don't only
look at the price. If you need help deciding what coverages you need,
use our car insurance coverage calculator.
The original article can be found at CarInsurance.com:
Compare insurance costs before buying a new car
Answer: I'm a big advocate of shopping around for auto insurance as part of the research one does before buying a car. If you wait until you've decided on one certain car, or worse yet, already purchased a new vehicle, you may find out your auto insurance premiums will make your choice of car no longer affordable.
The process will give you a big picture of what various cars will cost to own. (See “How to insure a new car
”) You may find that the difference between the cars is small compared with the difference between insurance companies.I ran car insurance quotes on a Dodge Avenger, Mazda3, and Mitsubishi Eclipse for a 30-year-old male living in Houston (your geographical location
makes a big difference) with a clean driving record.I chose liability limits
of 50/100/50, which breaks down to $50,000 per person and $100,000 per
incident for bodily injury liability and $50,000 for property damage
liability. Since these are new cars, I also added physical damage
coverages of collision and comprehensive, each with a $500 deductible.The 2012 Avenger was the cheapest of the three vehicles to insure with an annual rate of $1,422. The 2012 Mazda3 was second with an annual auto insurance premium of $1,534, and the 2012 Mitsubishi Eclipse was the most expensive to insure per year at $1,656.
But look at how much comparison shopping
really matters. The quotes for the Avenger ranged from $1,422 to
$2,088, for the Mazda3, from $1,534 to $2,518, and for the Eclipse,
$1,656 up to $2,516.Finding the auto insurance provider that is pricing competitively for your set of rating factors is important since, as you can see, the difference in cost can be hundreds, if not thousands, of dollars. (See “Save $1,102 just by shopping around
”)Certainly the car can make a difference. If a car is stolen more often or has higher repair costs -- that is, if the car has more frequent or larger insurance claims, -- then it will cost more to insure than a similar car with lower claims frequency or cheaper parts. (See "How a car gets a bad reputation
.")But the vehicle is only a small component of a very long financial equation. Where you live, your occupation, marital status and other things that insurers see as risk factors will change your rate from the sample I've given here.
You can easily compare rates for yourself, using your own information, with CarInsurance.com's rate-comparison engine
.
You can find rates on the first car you're considering, then click the
Review button at the top right of the rate screen The menu that opens
will allow you to change any of the information you have already
entered, such as the vehicle, and get an updated quote.And you can always edit other items to see how they change your rate quote. Raising your deductibles (see “Will higher deductibles save you money
”),
lowering your liability limits, and so on within the car insurance
quoting form will change how much your auto insurance premium will be.
Just make sure what coverage you choose is right for you, don't only
look at the price. If you need help deciding what coverages you need,
use our car insurance coverage calculator.The original article can be found at CarInsurance.com:
Compare insurance costs before buying a new car
Wheels have come off UK car insurance Prices, accidents and vandalism are all down, but deliberately bloated repair costs mean premiums keep going up
Vehicle theft and
vandalism have plummeted, but insurers still whip up fears of car crime
to jusitfy higher premiums. Photograph: Steve Allen/Alamy
The car insurance
market is broken. As a country, we're paying around £10bn a year to
insure our cars, and billions of that is wasted. According to the AA,
drivers in Britain fork out an average of nearly £1,000 each to insure
their cars, up from around £350 in 1994. Those figures include everyone
from 17 upwards, which is why they seem so high – most middle-aged
people pay closer to £500-£700. Yet it's evident that car insurance
has shot far ahead of inflation and earnings, despite the fact that (a)
we're having fewer serious car accidents and fatalities almost year in,
year out; (b) car crime has collapsed; and (c) car prices have fallen.
One of the fantastic things about Britain is how few people die on our roads – just 1,900 last year, with 23,000 serious injuries. In 1990, it was 5,217 dead and 60,000 more seriously injured, while in 1966, the worst year, we killed 7,985 people on the roads. In France, the figures are double ours.
Now let's look at car theft and vandalism. According to the ONS, the total recorded "offences against vehicles" soared in the 1980s, peaking in 1992 at 1.55m. Since then the fall has been astonishing, with just 417,000 offences against vehicles in 2011/12. Even as unemployment has climbed, theft and car crime has continued to fall. So while insurers whip up fear about car crime to justify costly premiums, in fact it's at the lowest level in a generation.
What about car prices? A new Ford Focus (£14,000+) costs a lot more than a Ford Cortina in 1980 (£3,475), but in real terms the price of cars has advanced little, if at all. Meanwhile the price of used cars has fallen, both in real and absolute terms. I called webuyanycar for a valuation on my only car, a 51-reg Alfa. It came in below £400 – less than I pay for the insurance on it.
How did we get to the situation where insurance can cost more than your car? The reality is that the part of the premium that goes to cover accidents and theft keeps falling. Instead we are paying for all the other nonsense now built into your premium – deliberately bloated repair costs, outrageously priced "courtesy" car hire, spurious whiplash claims and burgeoning uninsured losses.
The insurance industry wails about it, but is largely at fault itself. It is riddled with perverse incentives, because the person paying the bill often isn't the one managing the repair. If you knock another car, it goes off to their insurer's "authorised" repair yard, which, because it's charging your insurer, has no incentive to keep costs under control. Its incentive is the reverse – it will want to drag out the repair, add in costs and commissions, and offer a ludicrously expensive replacement car while the other one is off the road, and for as long as possible.
The Competition Commission has begun an investigation into the car insurance market, but don't hold your breath. We need a fundamental rethink. UK car insurance looks like US healthcare; super-loaded with costs, but with worse outcomes than countries with socialised medicine. Government, rightly, makes car insurance compulsory, but leaves profligate private providers to manage it. How about a National Car Insurance Service?
One of the fantastic things about Britain is how few people die on our roads – just 1,900 last year, with 23,000 serious injuries. In 1990, it was 5,217 dead and 60,000 more seriously injured, while in 1966, the worst year, we killed 7,985 people on the roads. In France, the figures are double ours.
Now let's look at car theft and vandalism. According to the ONS, the total recorded "offences against vehicles" soared in the 1980s, peaking in 1992 at 1.55m. Since then the fall has been astonishing, with just 417,000 offences against vehicles in 2011/12. Even as unemployment has climbed, theft and car crime has continued to fall. So while insurers whip up fear about car crime to justify costly premiums, in fact it's at the lowest level in a generation.
What about car prices? A new Ford Focus (£14,000+) costs a lot more than a Ford Cortina in 1980 (£3,475), but in real terms the price of cars has advanced little, if at all. Meanwhile the price of used cars has fallen, both in real and absolute terms. I called webuyanycar for a valuation on my only car, a 51-reg Alfa. It came in below £400 – less than I pay for the insurance on it.
How did we get to the situation where insurance can cost more than your car? The reality is that the part of the premium that goes to cover accidents and theft keeps falling. Instead we are paying for all the other nonsense now built into your premium – deliberately bloated repair costs, outrageously priced "courtesy" car hire, spurious whiplash claims and burgeoning uninsured losses.
The insurance industry wails about it, but is largely at fault itself. It is riddled with perverse incentives, because the person paying the bill often isn't the one managing the repair. If you knock another car, it goes off to their insurer's "authorised" repair yard, which, because it's charging your insurer, has no incentive to keep costs under control. Its incentive is the reverse – it will want to drag out the repair, add in costs and commissions, and offer a ludicrously expensive replacement car while the other one is off the road, and for as long as possible.
The Competition Commission has begun an investigation into the car insurance market, but don't hold your breath. We need a fundamental rethink. UK car insurance looks like US healthcare; super-loaded with costs, but with worse outcomes than countries with socialised medicine. Government, rightly, makes car insurance compulsory, but leaves profligate private providers to manage it. How about a National Car Insurance Service?
Ban on referral fees seeks to curb rise in insurance costs The government says honest motorists are seeing car insurance premiums rise as insurers seek to cover the costs of increased compensation claims
Referral fees feed the
growing compensation culture that has been pushing up insurance
premiums, says Which?. Photograph: Steve Cole/Getty Images
The government hopes to stem rising insurance costs by banning referral fees in personal injury claim cases.
The fees, highlighted by former Labour MP Jack Straw in June, are paid to claims management companies, garages and insurance companies who provide details of accidents – often car accidents – to personal injury lawyers.
The business is estimated to be worth £3bn a year, and successful claims are paid in most cases by insurance policies. Insurers have covered the cost by passing it on to policyholders in the form of higher premiums.
Justice minister Jonathan Djanogly said: "Honest motorists are seeing their premiums hiked up as insurance companies cover the increasing costs of more and more compensation claims. Many of the claims are spurious and only happen because the current system allows too many people to profit from minor accidents and incidents.
"Referral fees are one symptom of the compensation culture problem and too much money sloshing through the system."
Djanogly said people were being encouraged to sue at no risk to themselves, "leaving schools, business and individuals living in fear of being dragged to the courts for simply going about daily life".
He added: "We will ban referral fees and we will go further. We have proposals before parliament to end the bizarre situation in which people have no stake in the legal costs their cases bring. This will make claimants think harder about whether to sue and give insurance companies and business generally an incentive to pass the savings on to customers through lower prices."
A spokesman for the Ministry of Justice denied that the announcement was in response to an announcement by the Office of Fair Trading yesterday that it will investigate soaring car insurance premiums to determine whether drivers are being overcharged.
The Association of British Insurers (ABI) said the industry was committed to keeping costs down for consumers, but reform of the compensation system was necessary if premiums were to come down.
Director general Otto Thoresen said: "Rising claims costs from personal injury claims, excessive legal costs, insurance fraud and uninsured driving, coupled with lower investment returns in recent years, have unfortunately led to rising motor insurance bills for many customers.
"In fact, the motor insurance sector has not been profitable for the last 16 years because the amount paid out in claims and expenses has been greater than that received in premiums."
Thoresen said moves to reform the compensation system in Ireland had led to a 16% reduction in motor insurance premiums.
The news was welcomed by consumer group Which?. Chief executive Richard Lloyd said: "This is great news for motorists. Referral fees feed the growing compensation culture that has been pushing up insurance premiums at a time when many families are already feeling the pinch. It's absolutely right to ban them, and quickly."
There is no timetable for when the ban will be introduced, but the plan is that it will be a regulatory offence for firms to pay and receive referral fees.
The government's proposals currently before parliament focus on stopping losing defendants having to pay a "success fee".
The government is changing the law so that in future the person making the claim will have to pay the success fee, rather than the defendant, and the fee will be capped. The intended result is a fairer split of costs between parties and lower legal costs overall, which means lower costs to pass on to customers or taxpayers.
The proposals follow a Ministry of Justice consultation published in November 2010.
The fees, highlighted by former Labour MP Jack Straw in June, are paid to claims management companies, garages and insurance companies who provide details of accidents – often car accidents – to personal injury lawyers.
The business is estimated to be worth £3bn a year, and successful claims are paid in most cases by insurance policies. Insurers have covered the cost by passing it on to policyholders in the form of higher premiums.
Justice minister Jonathan Djanogly said: "Honest motorists are seeing their premiums hiked up as insurance companies cover the increasing costs of more and more compensation claims. Many of the claims are spurious and only happen because the current system allows too many people to profit from minor accidents and incidents.
"Referral fees are one symptom of the compensation culture problem and too much money sloshing through the system."
Djanogly said people were being encouraged to sue at no risk to themselves, "leaving schools, business and individuals living in fear of being dragged to the courts for simply going about daily life".
He added: "We will ban referral fees and we will go further. We have proposals before parliament to end the bizarre situation in which people have no stake in the legal costs their cases bring. This will make claimants think harder about whether to sue and give insurance companies and business generally an incentive to pass the savings on to customers through lower prices."
A spokesman for the Ministry of Justice denied that the announcement was in response to an announcement by the Office of Fair Trading yesterday that it will investigate soaring car insurance premiums to determine whether drivers are being overcharged.
The Association of British Insurers (ABI) said the industry was committed to keeping costs down for consumers, but reform of the compensation system was necessary if premiums were to come down.
Director general Otto Thoresen said: "Rising claims costs from personal injury claims, excessive legal costs, insurance fraud and uninsured driving, coupled with lower investment returns in recent years, have unfortunately led to rising motor insurance bills for many customers.
"In fact, the motor insurance sector has not been profitable for the last 16 years because the amount paid out in claims and expenses has been greater than that received in premiums."
Thoresen said moves to reform the compensation system in Ireland had led to a 16% reduction in motor insurance premiums.
The news was welcomed by consumer group Which?. Chief executive Richard Lloyd said: "This is great news for motorists. Referral fees feed the growing compensation culture that has been pushing up insurance premiums at a time when many families are already feeling the pinch. It's absolutely right to ban them, and quickly."
There is no timetable for when the ban will be introduced, but the plan is that it will be a regulatory offence for firms to pay and receive referral fees.
The government's proposals currently before parliament focus on stopping losing defendants having to pay a "success fee".
The government is changing the law so that in future the person making the claim will have to pay the success fee, rather than the defendant, and the fee will be capped. The intended result is a fairer split of costs between parties and lower legal costs overall, which means lower costs to pass on to customers or taxpayers.
The proposals follow a Ministry of Justice consultation published in November 2010.
Pilots land lowest car insurance premiums Confused.com insurance premium figures reveal Britain's safest and riskiest drivers
Late night driving is
one factor that puts DJs in the highest risk category by profession for
insurance premiums. Photograph: Justin Carrasquillo/Getty Images
Airline pilots are the safest drivers on the road, while party DJs are the most risky, according to an analysis of a year of car insurance quotes sought by customers at Confused.com.
The captain of a 747 will typically pay just £321 a year for car insurance, while a mobile disco owner, who probably makes more late night journeys, will be charged on average £6,810 a year.
Occupation is just one of the risks that determine the size of a car insurance quote, with other factors such as age, location, type of car and driving history usually more important. But some jobs suggest a level of risk that send insurers scuttling.
After mobile disco owners, apprentice professional footballers are the riskiest drivers, said comparison site Confused, and are typically charged £6,264, although that may have something to do with a penchant for souped-up cars.
Football match referees also pay a high price for cover, facing an average car insurance bill of £3,679. The 40p a mile travel expenses that referees earn for travelling to matches may not quite make up for it.
The lowest car insurance quotes, after airline captains, goes to china restorers and toy makers – admittedly not the most racy of professions. But travel guide writers, where the job might include driving to off-the-beaten track locations, enjoy a surprisingly good deal as the fourth-lowest rated profession.
Confused said drivers who changed their job significantly should let their insurer know, as it could save them money if the new role is statistically less risky.
Gareth Kloet, the site's head of car insurance, said insurers took a wide range of factors into account when working out premiums.
"This does not mean that every airline captain will be landing a cheap deal – each individual will be quoted on their own data – but your profession can significantly affect your insurance cost, so if you change jobs it is worth letting your insurer know," he said.
"Contributing factors will include the type of car you choose to drive, the average age of people with that profession and of course your claims history as a driver."
If you want to check the riskiness of your occupation, and how you can legally change the wording of your job to move into a lower risk band, try MoneySavingExpert's car insurance job picker.
If you are an under-25-year-old male driver – always in the riskiest band – then it might also be worth checking those insurance companies that cut the price by installing "smart boxes" in cars which cut the cost if you drive more slowly, and avoid driving between 11pm and 5am when the worst and most expensive car accidents typically occur.
Professional footballer (apprentice) £6,263.61
Diplomatic staff, £4,087.96
Footballer, £3,992.69
Nightclub owner, £3,841.29
Referee, £3,679.02
Professional footballer (Football League), £3,422.26
Dealer, £3,082.06
Student (school), £3,006.18
Student (college, living with parents), £2,971.07
China restorer, £336.44
Toy maker, £337.87
Travel guide writer, £379.09
Guest house owner (unlicensed), £383.76
Smallholder, £390.21
Remedial therapist, £392.72
Ornithologist, £396
Pilot harbour ships, £400.22
State enrolled nurse, £406.42
• Annual comprehensive car insurance
Source: Based on all quotes made on confused.com during the 12 months from 1 October 2010 to 30 September 2011
The captain of a 747 will typically pay just £321 a year for car insurance, while a mobile disco owner, who probably makes more late night journeys, will be charged on average £6,810 a year.
Occupation is just one of the risks that determine the size of a car insurance quote, with other factors such as age, location, type of car and driving history usually more important. But some jobs suggest a level of risk that send insurers scuttling.
After mobile disco owners, apprentice professional footballers are the riskiest drivers, said comparison site Confused, and are typically charged £6,264, although that may have something to do with a penchant for souped-up cars.
Football match referees also pay a high price for cover, facing an average car insurance bill of £3,679. The 40p a mile travel expenses that referees earn for travelling to matches may not quite make up for it.
The lowest car insurance quotes, after airline captains, goes to china restorers and toy makers – admittedly not the most racy of professions. But travel guide writers, where the job might include driving to off-the-beaten track locations, enjoy a surprisingly good deal as the fourth-lowest rated profession.
Confused said drivers who changed their job significantly should let their insurer know, as it could save them money if the new role is statistically less risky.
Gareth Kloet, the site's head of car insurance, said insurers took a wide range of factors into account when working out premiums.
"This does not mean that every airline captain will be landing a cheap deal – each individual will be quoted on their own data – but your profession can significantly affect your insurance cost, so if you change jobs it is worth letting your insurer know," he said.
"Contributing factors will include the type of car you choose to drive, the average age of people with that profession and of course your claims history as a driver."
If you want to check the riskiness of your occupation, and how you can legally change the wording of your job to move into a lower risk band, try MoneySavingExpert's car insurance job picker.
If you are an under-25-year-old male driver – always in the riskiest band – then it might also be worth checking those insurance companies that cut the price by installing "smart boxes" in cars which cut the cost if you drive more slowly, and avoid driving between 11pm and 5am when the worst and most expensive car accidents typically occur.
Highest quotes by profession
Mobile disco owner, £6,809.57Professional footballer (apprentice) £6,263.61
Diplomatic staff, £4,087.96
Footballer, £3,992.69
Nightclub owner, £3,841.29
Referee, £3,679.02
Professional footballer (Football League), £3,422.26
Dealer, £3,082.06
Student (school), £3,006.18
Student (college, living with parents), £2,971.07
Lowest quotes by profession
Airline captain, £320.81China restorer, £336.44
Toy maker, £337.87
Travel guide writer, £379.09
Guest house owner (unlicensed), £383.76
Smallholder, £390.21
Remedial therapist, £392.72
Ornithologist, £396
Pilot harbour ships, £400.22
State enrolled nurse, £406.42
• Annual comprehensive car insurance
Source: Based on all quotes made on confused.com during the 12 months from 1 October 2010 to 30 September 2011
Money Car insurance Car insurance: why women face £300 rise in premiums An EU ruling means insurance commpanies must end gender discrimination, and female drivers under 40 will be hit hardest
Cartoon: Jonathan Edwards
Testosterone-fuelled young males are, all the statistics
suggest, a danger on the road. Thrill-seeking young men are prone to
drive too fast, late at night, and cause horrific fatalities. Young
males are 10 times more likely to be killed or injured than a driver
aged over 35. The typical insurance claim by a young male adds up to around £4,500, compared with £1,200 when the driver is middle-aged, whether male or female.
It's the main reason men pay around 40% more than women for car insurance until the age of 40, when accident rates and claims tend to equalise between the sexes. Yet from 21 December, insurers will be banned from taking gender into consideration when setting premiums – and women will pick up the tab.
According to the AA, the typical insurance premium for a male aged 17-22 is now above £3,000, while for a female it is £2,125. Men aged 23-29 pay an average of £1,840, compared with £1,200 for women. Only once men reach the age of 40 do their premiums come down to the same level as women (at around £700-£750).
What will happen when the directive comes into force? According to Gocompare.com, Britain's women are in for a shock. Most are unaware of the ruling and the huge impact it is likely to have. Gocompare's head of motor insurance, Scott Kelly, says: "We expect to see premiums equalised at the higher male rate rather than the lower rate for females. If that is the case, women drivers will see their premiums rise by just over £300 on average, but for younger age groups the increase could be as much as £2,000."
The scale of the premium increase – on top of the inflation-busting rises of recent years – means some young women who do not have to renew their insurance until January may save money by terminating their policy before the year end and starting a new one before 21 December.
But for older women, as Michael Winner might say, it's a case of "calm down, dear..." Unisex insurance rates will have virtually no impact on men and women above 40-45 as they are already treated as near identical risks at that age. Indeed, there may even be a very small bonus: the AA's figures suggest that women over 50 pay about £10 a year more in car insurance than men, so they may be in line for a small reduction. Young men will also benefit, with estimates that they will see 10% or more clipped off their premiums.
For now, the major insurers are silent about how they will price their policies for the unisex era. Money asked Direct Line and Aviva for quotes, but they refused to give specific figures, citing competition reasons.
Aviva would only go so far as saying: "Young males are likely to see their premiums fall, and young female drivers are likely to see their motor premiums rise." At Direct Line, Gus Park, director of motor insurance, said: "We were disappointed with the ruling, but now it is going to become law we're focused on minimising the impact of the gender directive. It's hard to be sure what is going to happen to prices within the market. Many customers will not be adversely affected. However, people shouldn't panic; they should wait for their renewal quote from their insurer and contact them if they have any concerns."
Many people will be justified in asking why the insurers don't just split the difference, with male and female insurance rates equalising halfway between the current rates. But Kelly explains: "If a 20-year-old male is being correctly priced for the risk he presents, then the insurer won't want to charge less than that. Instead, women will have to be charged more."
However that would suggest a huge surge in revenue for car insurance companies from their female customers. In reality, the Association of British Insurers doesn't believe all premiums will rise to the higher male rate, though it does think they will head that way. Overall, it reckons premiums for males will fall by up to 10%, but rise for females by around 25%.
A research paper for the ABI last year argued that the ban on the use of gender will result in an overall loss for consumers, as insurers will have less risk-based information to go on and will thus charge more overall. It also said the ban will not mean all women and men pay the same. "For example, a 27-year-old male driver from Swindon who drives a 2-litre BMW, and travels 15,000 miles each year, would need to be offered the same premium as a 27-year-old female driver from Swindon who drives a 2-litre BMW and travels 15,000 miles each year. This does not mean that, on average, male drivers in the insurer's book would be charged the same premiums as females."
But one thing insurers can't do is ignore the ruling. The ABI fought a long battle to maintain insurers' exemption from EU gender equality rules, but were finally defeated in a European Court of Justice ruling in March last year. The court gave insurers until 21 December to bring in unisex rates, with the biggest impact expected in Britain, Spain and Ireland, where gender-based pricing is most commonly used.
Ian Crowder, a spokesman for AA insurance says: "The ruling abandoned fairness in favour of equality. We were one of the voices saying it shouldn't happen, but it has, the ECJ has ruled, and that's now the end of the debate."
Supporters of the ruling argue it was never fair that gender should have come into premium calculations – plenty of young males are safe, cautious drivers, and plenty of young females are tearaways. Why should either be judged on gender? Instead, what the ruling is likely to spark is a switch to "telematics", where your premium is based on the data transmitted from a mini-computer in your car, which will record when you drive, where, and at what speed, as well as how hard you brake, or even corner. That may mean young males will still be charged a lot more than young females, but it will be because of driving profile, not gender.
Telematics, also known as "pay as you drive", is still in its infancy in the UK, making up only 3% of motor policies sold so far, and an early experiment by Aviva was less than successful. But as young females in particular face much steeper premiums, more will be tempted to opt for insurance based on telematics. A telematics deal usually starts off as relatively expensive, but as data builds up about the driver's habits and style, safe driving is rewarded by lower costs, with potential premium refunds. As Coverbox, a telematics insurer, says: "The box also allows us to check your miles, the times driven, where you keep the car overnight, and if it is different then we can decrease or increase the premium accordingly during the year."
Aviva is trialling a telematics "app" called RateMyDrive on smartphones, which can monitor acceleration, braking and cornering as well as the number of miles driven and the car's location. Safer drivers will be offered discounts of up to 20% off their insurance, although currently the trial is limited to 5,000 motorists.
Meanwhile, the EU gender directive affects all insurance products, not just car insurance. So from 21 December it will be illegal to use gender as a basis for discriminating in the pricing of pension annuities and life insurance. Women will again lose on life insurance; historically they pay lower premiums as they enjoy longer life expectancy. But there is a small payback when they hit pensionable age. Currently women receive lower annuities than men because they live longer, but the ruling will mean women may have to be given higher pension incomes.
It's the main reason men pay around 40% more than women for car insurance until the age of 40, when accident rates and claims tend to equalise between the sexes. Yet from 21 December, insurers will be banned from taking gender into consideration when setting premiums – and women will pick up the tab.
According to the AA, the typical insurance premium for a male aged 17-22 is now above £3,000, while for a female it is £2,125. Men aged 23-29 pay an average of £1,840, compared with £1,200 for women. Only once men reach the age of 40 do their premiums come down to the same level as women (at around £700-£750).
What will happen when the directive comes into force? According to Gocompare.com, Britain's women are in for a shock. Most are unaware of the ruling and the huge impact it is likely to have. Gocompare's head of motor insurance, Scott Kelly, says: "We expect to see premiums equalised at the higher male rate rather than the lower rate for females. If that is the case, women drivers will see their premiums rise by just over £300 on average, but for younger age groups the increase could be as much as £2,000."
The scale of the premium increase – on top of the inflation-busting rises of recent years – means some young women who do not have to renew their insurance until January may save money by terminating their policy before the year end and starting a new one before 21 December.
But for older women, as Michael Winner might say, it's a case of "calm down, dear..." Unisex insurance rates will have virtually no impact on men and women above 40-45 as they are already treated as near identical risks at that age. Indeed, there may even be a very small bonus: the AA's figures suggest that women over 50 pay about £10 a year more in car insurance than men, so they may be in line for a small reduction. Young men will also benefit, with estimates that they will see 10% or more clipped off their premiums.
For now, the major insurers are silent about how they will price their policies for the unisex era. Money asked Direct Line and Aviva for quotes, but they refused to give specific figures, citing competition reasons.
Aviva would only go so far as saying: "Young males are likely to see their premiums fall, and young female drivers are likely to see their motor premiums rise." At Direct Line, Gus Park, director of motor insurance, said: "We were disappointed with the ruling, but now it is going to become law we're focused on minimising the impact of the gender directive. It's hard to be sure what is going to happen to prices within the market. Many customers will not be adversely affected. However, people shouldn't panic; they should wait for their renewal quote from their insurer and contact them if they have any concerns."
Many people will be justified in asking why the insurers don't just split the difference, with male and female insurance rates equalising halfway between the current rates. But Kelly explains: "If a 20-year-old male is being correctly priced for the risk he presents, then the insurer won't want to charge less than that. Instead, women will have to be charged more."
However that would suggest a huge surge in revenue for car insurance companies from their female customers. In reality, the Association of British Insurers doesn't believe all premiums will rise to the higher male rate, though it does think they will head that way. Overall, it reckons premiums for males will fall by up to 10%, but rise for females by around 25%.
A research paper for the ABI last year argued that the ban on the use of gender will result in an overall loss for consumers, as insurers will have less risk-based information to go on and will thus charge more overall. It also said the ban will not mean all women and men pay the same. "For example, a 27-year-old male driver from Swindon who drives a 2-litre BMW, and travels 15,000 miles each year, would need to be offered the same premium as a 27-year-old female driver from Swindon who drives a 2-litre BMW and travels 15,000 miles each year. This does not mean that, on average, male drivers in the insurer's book would be charged the same premiums as females."
But one thing insurers can't do is ignore the ruling. The ABI fought a long battle to maintain insurers' exemption from EU gender equality rules, but were finally defeated in a European Court of Justice ruling in March last year. The court gave insurers until 21 December to bring in unisex rates, with the biggest impact expected in Britain, Spain and Ireland, where gender-based pricing is most commonly used.
Ian Crowder, a spokesman for AA insurance says: "The ruling abandoned fairness in favour of equality. We were one of the voices saying it shouldn't happen, but it has, the ECJ has ruled, and that's now the end of the debate."
Supporters of the ruling argue it was never fair that gender should have come into premium calculations – plenty of young males are safe, cautious drivers, and plenty of young females are tearaways. Why should either be judged on gender? Instead, what the ruling is likely to spark is a switch to "telematics", where your premium is based on the data transmitted from a mini-computer in your car, which will record when you drive, where, and at what speed, as well as how hard you brake, or even corner. That may mean young males will still be charged a lot more than young females, but it will be because of driving profile, not gender.
Telematics, also known as "pay as you drive", is still in its infancy in the UK, making up only 3% of motor policies sold so far, and an early experiment by Aviva was less than successful. But as young females in particular face much steeper premiums, more will be tempted to opt for insurance based on telematics. A telematics deal usually starts off as relatively expensive, but as data builds up about the driver's habits and style, safe driving is rewarded by lower costs, with potential premium refunds. As Coverbox, a telematics insurer, says: "The box also allows us to check your miles, the times driven, where you keep the car overnight, and if it is different then we can decrease or increase the premium accordingly during the year."
Aviva is trialling a telematics "app" called RateMyDrive on smartphones, which can monitor acceleration, braking and cornering as well as the number of miles driven and the car's location. Safer drivers will be offered discounts of up to 20% off their insurance, although currently the trial is limited to 5,000 motorists.
Meanwhile, the EU gender directive affects all insurance products, not just car insurance. So from 21 December it will be illegal to use gender as a basis for discriminating in the pricing of pension annuities and life insurance. Women will again lose on life insurance; historically they pay lower premiums as they enjoy longer life expectancy. But there is a small payback when they hit pensionable age. Currently women receive lower annuities than men because they live longer, but the ruling will mean women may have to be given higher pension incomes.
Barrows Insurance helps promote Breast Cancer Awareness Month Read more: Barrows Insurance helps promote Breast Cancer Awareness Month - Mansfield, MA - Mansfield News http://www.wickedlocal.com/mansfield/newsnow/x189742123/Barrows-Insurance-helps-promote-Breast-Cancer-Awareness-Month#ixzz28YNjTWkV
Mansfield —
Barrows Insurance Agency in Mansfield is working to raise both
awareness and funds for research during October for Breast Cancer
Awareness Month. In a special promotion, for every new customer who
writes both their home and auto insurance with Barrows Insurance Agency,
Barrows will make a donation to the Susan G. Komen Foundation.
“This is our third year offering this promotion and we are proud to do our part to help fight this horrible disease among women,” said Caitlin Barrows, a Customer Care representative for Barrows and daughter of owner, Jay Barrows. “Our Agency was founded by my grandmother, Janice Barrows, we’re staffed with some amazing women, and we have the privilege of serving so many clients who have had cancer touch their lives – dedicating a strong effort to this cause is important to all of us.”
The women of Barrows Insurance will also take to Facebook to share their personal stories and experiences to honor friends and loved ones who have battled or survived breast cancer. Barrows also encourages Facebook friends to honor their loved ones by sharing their inspirational stories as well.
“Our goal is to raise awareness and to empower women to remain vigilant about their health and fight for continuing research for a cure. We stand with the thousands of survivors and strong women fighting everywhere right now and are glad to utilize the purchase of something as basic as insurance can help make a difference,” said Barrows.
In addition, the Agency will sell Breast Cancer Awareness T-shirts created by Barrows Insurance agent, Mary MacLeod and her daughter, Erin, both of Easton. The idea was born out of support for a dear friend who was battling – and survived – breast cancer. The shirt design was used for their team, “Girl Power,” during the Avon Breast Cancer Walk. Appropriately, the shirts feature the American Cancer Society’s “Fight Like A Girl” logo with a beautiful butterfly image on the front and “Girl Power” on the back. All proceeds from the T-shirts will be donated to the American Cancer Society.
Anyone interested in purchasing the shirts are encouraged to visit the Barrows Insurance Agency website at BarrowsIns.com or their Facebook page for photos and more information. Shirts will soon be available for both adults and children.
“This is our third year offering this promotion and we are proud to do our part to help fight this horrible disease among women,” said Caitlin Barrows, a Customer Care representative for Barrows and daughter of owner, Jay Barrows. “Our Agency was founded by my grandmother, Janice Barrows, we’re staffed with some amazing women, and we have the privilege of serving so many clients who have had cancer touch their lives – dedicating a strong effort to this cause is important to all of us.”
The women of Barrows Insurance will also take to Facebook to share their personal stories and experiences to honor friends and loved ones who have battled or survived breast cancer. Barrows also encourages Facebook friends to honor their loved ones by sharing their inspirational stories as well.
“Our goal is to raise awareness and to empower women to remain vigilant about their health and fight for continuing research for a cure. We stand with the thousands of survivors and strong women fighting everywhere right now and are glad to utilize the purchase of something as basic as insurance can help make a difference,” said Barrows.
In addition, the Agency will sell Breast Cancer Awareness T-shirts created by Barrows Insurance agent, Mary MacLeod and her daughter, Erin, both of Easton. The idea was born out of support for a dear friend who was battling – and survived – breast cancer. The shirt design was used for their team, “Girl Power,” during the Avon Breast Cancer Walk. Appropriately, the shirts feature the American Cancer Society’s “Fight Like A Girl” logo with a beautiful butterfly image on the front and “Girl Power” on the back. All proceeds from the T-shirts will be donated to the American Cancer Society.
Anyone interested in purchasing the shirts are encouraged to visit the Barrows Insurance Agency website at BarrowsIns.com or their Facebook page for photos and more information. Shirts will soon be available for both adults and children.
Read more: Barrows Insurance helps promote Breast Cancer Awareness Month - Mansfield, MA - Mansfield News http://www.wickedlocal.com/mansfield/newsnow/x189742123/Barrows-Insurance-helps-promote-Breast-Cancer-Awareness-Month#ixzz28YNnUR9J
Mercury Insurance promotes another initiative to boost rates on drivers who dropped coverage
SACRAMENTO, Calif. —
Billionaire insurance executive George Joseph has been fighting with
consumer advocate Harvey Rosenfield for two decades over California's
landmark automobile insurance law.
This November, the two are squaring off again over a ballot initiative that would roll back a provision of the 1988 law and let insurance companies charge drivers based on their history of coverage.
Proposition 33 would allow anyone who went five years without a 90-day lapse in payments to maintain a "continuous coverage" discount even if they changed insurers. Opponents have seized upon a provision that says drivers who had dropped insurance coverage in the past would pay higher premiums.
A nearly identical measure was defeated two years ago, in part out of concern that military personnel would be harmed. This version makes an exception for service members and grants an 18-month grace period to people who lose their jobs.
Joseph, the chairman of Mercury General Corp., and other supporters say the change would lower rates for the 85 percent of drivers who already have car insurance. Rachel Hooper, a consultant for the Yes on Prop. 33 campaign, characterizes the measure as a win-win for business and customers.
"George Joseph really believes in competition and opening up the market, and letting consumers shop whatever insurance companies they choose," she said.
The initiative also would help Mercury and other insurers lure drivers from competing carriers because the continuous coverage discounts would follow the consumer.
Consumer groups say the initiative would hurt students, people recovering from illness, the long-term unemployed and others who dropped auto insurance for what they believed were valid reasons.
"It's like a bank robber putting an initiative on the ballot to legalize bank robberies," said Rosenfield, founder of Consumer Watchdog, based in Santa Monica. "The campaign led by Mercury to surcharge the public for not having insurance in the past has been going on since the mid-'90s."
Rosenfield said the initiative would allow companies to boost rates on people who had temporarily dropped their coverage because they could not afford to make monthly payments, and could lead to more uninsured drivers.
The initiative is necessary to get around Proposition 103, the 1988 Rosenfield-written law that forces insurers to set rates using only three main factors: driving experience; miles traveled per year; and safety record. Coverage history is specifically excluded.
If voters adopt Proposition 33, insurance companies would have the option of charging higher rates for previously uninsured drivers but still would be constrained by Proposition 103's prohibition on excessive rates.
In Texas, the Mercury Insurance quotes are 27.8 percent higher for uninsured motorists than for those who already have coverage. The Mercury loyalty discount for Californians is 5 percent.
That calculus is troubling to University of San Francisco sophomore Kelsey Craven, who said her family is scrambling to save money to make up for cuts to state financial aid. She would like to stop insuring the car she keeps in her parents' Sacramento garage, but worries that she will end up paying more in the long run if the rate-setting rules change.
"There are probably thousands of students that are in the same situation as me, who will go through college, graduate and then need a car again," said Craven, a politics major. "When we're already paying off student loans, we'll have to pay that much extra on top of car insurance."
Nan Brasmer said the change could hurt her when she has knee surgery next year and has to give up driving for several months.
"It is hard enough," said Brasmer, 74, who is president of the California Alliance for Retired Americans. "I pay $50 a month toward my car insurance, enough to pay my water bill or buy some food."
In 2010, Joseph outspent opponents of his ballot initiative 12 to 1 and is again pouring millions into his campaign. The 91-year-old executive also has won over the Berkeley-based Greenlining Institute, an economic justice advocacy group that opposed his 2010 initiative.
Greenlining's executive director, Orson Aguilar, said he supports Proposition 33 because it includes an exemption for active duty military and will reduce insurance rates for most drivers. The institute has accepted a $195,000 donation from Joseph.
Brian Sullivan, editor of the Auto Insurance Report newsletter, thinks Joseph and Rosenfield are "well-matched opponents" who make convincing cases.
In the end, he said, voters will have to choose whether they care more about lowering rates for themselves or helping out drivers with spotty coverage histories, who tend to be lower-income.
"It's not a matter of good and evil, it's a matter of what we deem to be fair," Sullivan said.
This November, the two are squaring off again over a ballot initiative that would roll back a provision of the 1988 law and let insurance companies charge drivers based on their history of coverage.
Proposition 33 would allow anyone who went five years without a 90-day lapse in payments to maintain a "continuous coverage" discount even if they changed insurers. Opponents have seized upon a provision that says drivers who had dropped insurance coverage in the past would pay higher premiums.
A nearly identical measure was defeated two years ago, in part out of concern that military personnel would be harmed. This version makes an exception for service members and grants an 18-month grace period to people who lose their jobs.
Joseph, the chairman of Mercury General Corp., and other supporters say the change would lower rates for the 85 percent of drivers who already have car insurance. Rachel Hooper, a consultant for the Yes on Prop. 33 campaign, characterizes the measure as a win-win for business and customers.
"George Joseph really believes in competition and opening up the market, and letting consumers shop whatever insurance companies they choose," she said.
The initiative also would help Mercury and other insurers lure drivers from competing carriers because the continuous coverage discounts would follow the consumer.
Consumer groups say the initiative would hurt students, people recovering from illness, the long-term unemployed and others who dropped auto insurance for what they believed were valid reasons.
"It's like a bank robber putting an initiative on the ballot to legalize bank robberies," said Rosenfield, founder of Consumer Watchdog, based in Santa Monica. "The campaign led by Mercury to surcharge the public for not having insurance in the past has been going on since the mid-'90s."
Rosenfield said the initiative would allow companies to boost rates on people who had temporarily dropped their coverage because they could not afford to make monthly payments, and could lead to more uninsured drivers.
The initiative is necessary to get around Proposition 103, the 1988 Rosenfield-written law that forces insurers to set rates using only three main factors: driving experience; miles traveled per year; and safety record. Coverage history is specifically excluded.
If voters adopt Proposition 33, insurance companies would have the option of charging higher rates for previously uninsured drivers but still would be constrained by Proposition 103's prohibition on excessive rates.
In Texas, the Mercury Insurance quotes are 27.8 percent higher for uninsured motorists than for those who already have coverage. The Mercury loyalty discount for Californians is 5 percent.
That calculus is troubling to University of San Francisco sophomore Kelsey Craven, who said her family is scrambling to save money to make up for cuts to state financial aid. She would like to stop insuring the car she keeps in her parents' Sacramento garage, but worries that she will end up paying more in the long run if the rate-setting rules change.
"There are probably thousands of students that are in the same situation as me, who will go through college, graduate and then need a car again," said Craven, a politics major. "When we're already paying off student loans, we'll have to pay that much extra on top of car insurance."
Nan Brasmer said the change could hurt her when she has knee surgery next year and has to give up driving for several months.
"It is hard enough," said Brasmer, 74, who is president of the California Alliance for Retired Americans. "I pay $50 a month toward my car insurance, enough to pay my water bill or buy some food."
In 2010, Joseph outspent opponents of his ballot initiative 12 to 1 and is again pouring millions into his campaign. The 91-year-old executive also has won over the Berkeley-based Greenlining Institute, an economic justice advocacy group that opposed his 2010 initiative.
Greenlining's executive director, Orson Aguilar, said he supports Proposition 33 because it includes an exemption for active duty military and will reduce insurance rates for most drivers. The institute has accepted a $195,000 donation from Joseph.
Brian Sullivan, editor of the Auto Insurance Report newsletter, thinks Joseph and Rosenfield are "well-matched opponents" who make convincing cases.
In the end, he said, voters will have to choose whether they care more about lowering rates for themselves or helping out drivers with spotty coverage histories, who tend to be lower-income.
"It's not a matter of good and evil, it's a matter of what we deem to be fair," Sullivan said.
The IIHS has identified the leading four cars in terms of crash test performance.
The Insurance Institute for Highway Safety
has released its ratings for “Top Safety Pick” in order to identify the
car models that performed the best in its auto insurance crash test
ratings.
The safety group
Among all of the vehicles that were rated, there were four that were given the Top Safety Pick
designation. Among them, was the Dodge Dart, one of the vehicles
Chrysler is hoping will become a top seller. This 2013 model was
originally designed as a joint project between Chrysler Group LLC and
Fiat SpA.
According to the chief of the Dodge brand at Chrysler, Reid Bigland, “We had high expectations for the Dart and our engineers delivered.”
Russ Rader, an IIHS spokesperson, explained that last year, there were 180 vehicles tested and among them, 132 received the designation of Top Safety Pick. This year, due to changes in the testing and measures, the list was much shorter. This is meant to encourage the auto insurance and design industry to step up its safety efforts even further. This doesn’t mean that the vehicles are less safe, it only means that the bar has now been raised, and there are only four vehicles in the 2013 model year that have met that challenge, so far.
Each of the four top auto insurance safety performers have been brought into the American marketplace over the last few months and have been showing strong sales among U.S. consumers. After having passed the more stringent safety tests, this can only reflect well on the future sales of those models.
The safety group
is among the most influential in the industry.
Among all of the vehicles that were rated, there were four that were given the Top Safety Pick
designation. Among them, was the Dodge Dart, one of the vehicles
Chrysler is hoping will become a top seller. This 2013 model was
originally designed as a joint project between Chrysler Group LLC and
Fiat SpA.Three other models for 2013 were also given this coveted auto insurance designation.
These other Top Safety Picks included the Lexus ES 350 midsize luxury sedan, the Hyundai Motor Co. crossover Santa Fe, and the Subaru XV Crosstrek hatchback. By receiving this auto insurance rating, it means that each of these vehicles were able to perform well within the IIHS crash tests that measured performance from impacts to the front, side, and rear, in addition to rollovers.According to the chief of the Dodge brand at Chrysler, Reid Bigland, “We had high expectations for the Dart and our engineers delivered.”
Russ Rader, an IIHS spokesperson, explained that last year, there were 180 vehicles tested and among them, 132 received the designation of Top Safety Pick. This year, due to changes in the testing and measures, the list was much shorter. This is meant to encourage the auto insurance and design industry to step up its safety efforts even further. This doesn’t mean that the vehicles are less safe, it only means that the bar has now been raised, and there are only four vehicles in the 2013 model year that have met that challenge, so far.
Each of the four top auto insurance safety performers have been brought into the American marketplace over the last few months and have been showing strong sales among U.S. consumers. After having passed the more stringent safety tests, this can only reflect well on the future sales of those models.
The Hartford, MIT List Top 10 Car Safety Technologies
The elderly may have a tougher time driving as
they age, but getting behind the wheel may be safer thanks to
technologies that will require them to do less of that driving
themselves.
A new list from The Hartford and the Massachusetts Institute of Technology (MIT) highlights the top 10 car technologies that help older drivers on the road, and many of those technologies are warning and assist systems promoting safe driving and awareness.
The list, assembled by an expert group including professionals from fields including geriatrics and ergonomics, focused on useful devices that could aid mature drivers who were 50 years of age and older:
–smart headlights
–emergency response systems
–reverse-monitoring systems
–blind-spot warning systems
–lane departure warning systems
–vehicle stability control
–parking assist systems
–voice-activated systems
–crash-mitigation systems
–drowsy driver alerts
In addition to compiling the list, MIT’s AgeLab released research findings showing 65 percent of older drivers report that having the latest technologies increases their confidence.
Also, 1 in 4 older drivers say that their foremost concern is their vision during nighttime driving.
That common problem makes smart headlights one of the list’s most useful tools, according to Jodi Olshevski, a gerontologist with The Hartford. Such headlights come equipped with camera-like technology in the front of a vehicle that automatically adjusts the intensity and range of the beam based on oncoming traffic.
“It actually helps you not only see better, but it also reduces glare,” Olshevski said in a video guide released with the list.
The blind-spot warning system, which alerts motorists to any objects entering their blind spots, is especially helpful to older drivers who have reduced range of motion and reaction time, Olshevski said.
“It’s like I have a co-pilot with me,” said Joan Callahan, a new car owner who was featured in the video, about the warning system.
Callahan added that some technologies will take some getting used to, including the reverse-monitoring system that provides an in-dashboard video feed of what is behind the vehicle.
Olshevski said practice makes perfect with such technologies.
“It’s true that a lot of this technology does take some getting used to,” she said. “Once drivers get comfortable and they actually adjust their driving style to make space for these new features, it can really become second nature.
And with that comes a new level of confidence, which all of us can benefit from as we age.”
Facing Greater Risk, Older Drivers Have Insurance Decisions to Make
Coverage rates tick upward for drivers as they enter old age because older drivers present greater risk for insurers to cover.
Based on miles traveled, fatality rates rise beginning at 75 years old before seeing a significant jump after 80 years old, though “fragility begins to increase” between the ages of 60 and 64, according to the Insurance Institute for Highway Safety.
The National Highway Traffic Safety Administration reported that, in 2009, older drivers accounted for 16 percent of all traffic fatalities, 15 percent of vehicle occupant fatalities and 19 percent of pedestrian fatalities.
But older drivers may still be able to find a cheap insurer to provide them affordable coverage.
Overall, crash rates tend to go down as drivers age. And as of August 2011, 31 states and the District of Columbia require insurance premium discounts for drivers 55 years old and over after they’ve completed eligible accident prevention courses, according to the National Association of Insurance Commissioners.
Alabama just made it easier for seniors to obtain that insurance discount, too. Recent revisions to the state’s motor vehicle code reduced the number of instruction hours a driver needs to get reduced premiums from eight to six. Another change made online course participants eligible for the discount.
A new list from The Hartford and the Massachusetts Institute of Technology (MIT) highlights the top 10 car technologies that help older drivers on the road, and many of those technologies are warning and assist systems promoting safe driving and awareness.
The list, assembled by an expert group including professionals from fields including geriatrics and ergonomics, focused on useful devices that could aid mature drivers who were 50 years of age and older:
–smart headlights
–emergency response systems
–reverse-monitoring systems
–blind-spot warning systems
–lane departure warning systems
–vehicle stability control
–parking assist systems
–voice-activated systems
–crash-mitigation systems
–drowsy driver alerts
In addition to compiling the list, MIT’s AgeLab released research findings showing 65 percent of older drivers report that having the latest technologies increases their confidence.
Also, 1 in 4 older drivers say that their foremost concern is their vision during nighttime driving.
That common problem makes smart headlights one of the list’s most useful tools, according to Jodi Olshevski, a gerontologist with The Hartford. Such headlights come equipped with camera-like technology in the front of a vehicle that automatically adjusts the intensity and range of the beam based on oncoming traffic.
“It actually helps you not only see better, but it also reduces glare,” Olshevski said in a video guide released with the list.
The blind-spot warning system, which alerts motorists to any objects entering their blind spots, is especially helpful to older drivers who have reduced range of motion and reaction time, Olshevski said.
“It’s like I have a co-pilot with me,” said Joan Callahan, a new car owner who was featured in the video, about the warning system.
Callahan added that some technologies will take some getting used to, including the reverse-monitoring system that provides an in-dashboard video feed of what is behind the vehicle.
Olshevski said practice makes perfect with such technologies.
“It’s true that a lot of this technology does take some getting used to,” she said. “Once drivers get comfortable and they actually adjust their driving style to make space for these new features, it can really become second nature.
And with that comes a new level of confidence, which all of us can benefit from as we age.”
Facing Greater Risk, Older Drivers Have Insurance Decisions to Make
Coverage rates tick upward for drivers as they enter old age because older drivers present greater risk for insurers to cover.
Based on miles traveled, fatality rates rise beginning at 75 years old before seeing a significant jump after 80 years old, though “fragility begins to increase” between the ages of 60 and 64, according to the Insurance Institute for Highway Safety.
The National Highway Traffic Safety Administration reported that, in 2009, older drivers accounted for 16 percent of all traffic fatalities, 15 percent of vehicle occupant fatalities and 19 percent of pedestrian fatalities.
But older drivers may still be able to find a cheap insurer to provide them affordable coverage.
Overall, crash rates tend to go down as drivers age. And as of August 2011, 31 states and the District of Columbia require insurance premium discounts for drivers 55 years old and over after they’ve completed eligible accident prevention courses, according to the National Association of Insurance Commissioners.
Alabama just made it easier for seniors to obtain that insurance discount, too. Recent revisions to the state’s motor vehicle code reduced the number of instruction hours a driver needs to get reduced premiums from eight to six. Another change made online course participants eligible for the discount.
Illinois Insurance Providers Hiking Prices in August Rate Filings
The latest batch of rate filings approved by Illinois insurance regulators in August showed rate increases at 16 insurers.The following approved changes were made for personal auto insurance policies and are on average, with actual rate adjustments ranging from customer to customer.
Illinois Farmers was approved for some of the larger changes out of all the rate filings, with liability rates increasing 17.3 percent and physical damage rates increasing 10.9 percent at the beginning of August. The insurer was also one of the larger underwriters in the filings, writing more than $200 million in personal auto premiums in the state.
Owners, another relatively large underwriter with almost $50 million in personal auto policies, was approved for smaller increases of 0.4 percent for liability and 1.9 percent for physical damage. Those changes took effect at the end of August for new customers and will kick in at the end of September for renewing policyholders.
Regulators approved changes for three coverage programs at Mendakota, kicking in on Oct. 20 for renewing policies while new policy changes have already taken effect:
–Within the Pioneer program, liability policies were approved for a 2.1 percent increase while physical damage policies were approved for a 4.1 percent increase.
–The Premier program was approved for a 2.3 percent increase to auto liability and 4.1 percent to physical damage.
–The Patriot program was approved to decrease both liability and physical damage policies by 0.1 percent.
Approval for increases at Hallmark brought up liability policies by 10.7 percent and physical damage policies by 7.1 percent. Those changes are already in effect.
Auto-Owners approvals, which go into effect Sept. 27 for renewing business and already went into effect Aug. 22 for new customers, sent liability policies up by 0.7 percent and physical damage policies by 1.3 percent.
Changes to Bristol West policies took effect at the beginning of August, boosting liability policies by 10.4 percent and physical damage policies by 5.6 percent. The company underwrites a little more than $15 million in those policies.
On Sept. 24, Victoria Select will increase liability policies by 2.3 percent and physical damage policies by 0.1 percent for new business.
Badger Mutual will hike both auto liability and physical damage rates by 3.7 percent at the beginning of October.
A handful of other companies were approved for increases, but they do not go into effect until November or December. Check back for updates on those.
This information is based on rate filings released by state insurance regulators, whose duties include analyzing insurers’ requests to change their rates and aiding consumers, whether that means answering car insurance questions or investigating policyholders’ complaints.
Illinois Insurance Providers Hiking Prices in August Rate Filings
The latest batch of rate filings approved by Illinois insurance regulators in August showed rate increases at 16 insurers.The following approved changes were made for personal auto insurance policies and are on average, with actual rate adjustments ranging from customer to customer.
Illinois Farmers was approved for some of the larger changes out of all the rate filings, with liability rates increasing 17.3 percent and physical damage rates increasing 10.9 percent at the beginning of August. The insurer was also one of the larger underwriters in the filings, writing more than $200 million in personal auto premiums in the state.
Owners, another relatively large underwriter with almost $50 million in personal auto policies, was approved for smaller increases of 0.4 percent for liability and 1.9 percent for physical damage. Those changes took effect at the end of August for new customers and will kick in at the end of September for renewing policyholders.
Regulators approved changes for three coverage programs at Mendakota, kicking in on Oct. 20 for renewing policies while new policy changes have already taken effect:
–Within the Pioneer program, liability policies were approved for a 2.1 percent increase while physical damage policies were approved for a 4.1 percent increase.
–The Premier program was approved for a 2.3 percent increase to auto liability and 4.1 percent to physical damage.
–The Patriot program was approved to decrease both liability and physical damage policies by 0.1 percent.
Approval for increases at Hallmark brought up liability policies by 10.7 percent and physical damage policies by 7.1 percent. Those changes are already in effect.
Auto-Owners approvals, which go into effect Sept. 27 for renewing business and already went into effect Aug. 22 for new customers, sent liability policies up by 0.7 percent and physical damage policies by 1.3 percent.
Changes to Bristol West policies took effect at the beginning of August, boosting liability policies by 10.4 percent and physical damage policies by 5.6 percent. The company underwrites a little more than $15 million in those policies.
On Sept. 24, Victoria Select will increase liability policies by 2.3 percent and physical damage policies by 0.1 percent for new business.
Badger Mutual will hike both auto liability and physical damage rates by 3.7 percent at the beginning of October.
A handful of other companies were approved for increases, but they do not go into effect until November or December. Check back for updates on those.
This information is based on rate filings released by state insurance regulators, whose duties include analyzing insurers’ requests to change their rates and aiding consumers, whether that means answering car insurance questions or investigating policyholders’ complaints.
Illinois Insurance Providers Hiking Prices in August Rate Filings
The latest batch of rate filings approved by Illinois insurance regulators in August showed rate increases at 16 insurers.The following approved changes were made for personal auto insurance policies and are on average, with actual rate adjustments ranging from customer to customer.
Illinois Farmers was approved for some of the larger changes out of all the rate filings, with liability rates increasing 17.3 percent and physical damage rates increasing 10.9 percent at the beginning of August. The insurer was also one of the larger underwriters in the filings, writing more than $200 million in personal auto premiums in the state.
Owners, another relatively large underwriter with almost $50 million in personal auto policies, was approved for smaller increases of 0.4 percent for liability and 1.9 percent for physical damage. Those changes took effect at the end of August for new customers and will kick in at the end of September for renewing policyholders.
Regulators approved changes for three coverage programs at Mendakota, kicking in on Oct. 20 for renewing policies while new policy changes have already taken effect:
–Within the Pioneer program, liability policies were approved for a 2.1 percent increase while physical damage policies were approved for a 4.1 percent increase.
–The Premier program was approved for a 2.3 percent increase to auto liability and 4.1 percent to physical damage.
–The Patriot program was approved to decrease both liability and physical damage policies by 0.1 percent.
Approval for increases at Hallmark brought up liability policies by 10.7 percent and physical damage policies by 7.1 percent. Those changes are already in effect.
Auto-Owners approvals, which go into effect Sept. 27 for renewing business and already went into effect Aug. 22 for new customers, sent liability policies up by 0.7 percent and physical damage policies by 1.3 percent.
Changes to Bristol West policies took effect at the beginning of August, boosting liability policies by 10.4 percent and physical damage policies by 5.6 percent. The company underwrites a little more than $15 million in those policies.
On Sept. 24, Victoria Select will increase liability policies by 2.3 percent and physical damage policies by 0.1 percent for new business.
Badger Mutual will hike both auto liability and physical damage rates by 3.7 percent at the beginning of October.
A handful of other companies were approved for increases, but they do not go into effect until November or December. Check back for updates on those.
This information is based on rate filings released by state insurance regulators, whose duties include analyzing insurers’ requests to change their rates and aiding consumers, whether that means answering car insurance questions or investigating policyholders’ complaints.
Esurance Extends Business to Arkansas Drivers
This
month, Esurance began selling policies in Arkansas, the latest
expansion for the insurer that has seen major growth efforts since
Allstate acquired it last October.Currently, Esurance offers auto coverage in 32 states, according to spokesman Danny Miller. The direct-to-consumer insurer’s last statewide expansion was opening up business in Kansas in July. Miller declined to comment on why it is only now that the company has extended business to these states.
In July, Esurance moved into social media advertising with its “Like to Save” discount that gives policyholders in Texas and Arizona discounts when they “like” the auto insurer through their Facebook account.
Esurance Saw UBI, PAYD Expansion This Year
Esurance has been a focal point of Allstate’s expansion plans since the larger-scale insurer bought out Esurance and Answer Financial for approximately $1 billion in October 2011.
Since then, Esurance pilot-tested and introduced its usage-based insurance (UBI) program, called “DriveSense,” that representatives say can save policyholders up to 30 percent on their coverage.
Also, Esurance’s pay-as-you-drive (PAYD) program, called “Drive Less, Save More” was approved for operation in California.
Esurance Key in Allstate’s Battle for Market Share
Allstate has been battling for its share of an intensely competitive auto insurance marketplace. According to the most recent data from the National Association of Insurance Commissioners (NAIC), Allstate has the second-largest market share, at 10.3 percent, but is closely trailed by GEICO, which owns about 9 percent of the market. Progressive follows GEICO with 7.9 percent.
Opening up business in more states undoubtedly lends weight to Allstate in the race to be the marketplace’s leading auto insurer; Allstate saw strong profits in its first- and second-quarter financials.
In the second quarter, Allstate representatives said that the number of policies in force at Esurance had grown 13.5 percent since the end of 2011.
The growth in policies are at least in part due to an “aggressive rebranding” of Esurance, according to a June SNL Financial report on advertising within the auto coverage industry.
According to the report, Allstate poured $45 million into advertising Esurance in the first quarter of 2012, driving campaigns including commercials voiced by actor John Krasinski from NBC’s “The Office.”
Survey: Non-driving Insurance Pricing Factors a Consumer Turnoff
A nationwide survey of consumers shows they find
it unfair that factors unrelated to driving play a part in how much
they’re charged for auto coverage, while insurers refuted the results
from the survey, saying the pricing process is complex and that use of
non-driving factors is necessary.
The survey was conducted by ORC International for the Consumer Federation of America (CFA) and included responses from 1,100 people. Factors that those surveyed find to be unjustified include education levels and presence of previous coverage.
“These factors have nothing to do with driving and discriminate against lower-income drivers,” Stephen Brobeck, CFA executive director, said in a statement. “Premiums should largely reflect factors … over which drivers have some control and which directly affect insurer costs.”
The question posed to respondents was: “How fair do you think it is for insurers to use each of the following factors in deciding on an auto insurance price for a driver?”
A policyholder’s number of traffic accidents was the top factor in the survey that respondents said was a “very” or “somewhat” fair factor, with 87 percent. Meanwhile, gender was at the bottom of the pile, with only 30 percent responding that it was a justifiable factor used in insurance rate pricing.
The survey’s complete listing is as follows, with the percentage of respondents saying the factor was “very” or “somewhat” fair:
–Traffic accidents caused: 87 percent
–Moving violations like speeding tickets: 85 percent
–Number of years with a license: 74 percent
–Age: 66 percent
–Miles driven: 61 percent
–Location of residence: 45 percent
–Occupation: 33 percent
–No previous insurance because no car: 32 percent
–Level of education: 31 percent
–Credit score: 31 percent
–Gender: 30 percent
Insurers Rebut CFA, Say Using Range of Factors Necessary
The Property Casualty Insurers Association of America (PCI), which represents 1,000 insurers in what is the industry’s largest trade group, called the CFA’s latest findings a “mostly misguided public policy prescription” that would be “counterproductive and hurt most motorists, resulting in higher costs and fewer choices for all consumers.”
Non-driving factors play just as important as driving-related factors in the complex method of pricing coverage, according to PCI.
“When blended together, these factors help to ensure that low-risk consumers can be better identified and pay less for insurance,” Alex Hageli, PCI director of personal lines, said in a statement.
Pricing methods are so complex, Hageli said, that the response from consumers in the survey was unsurprising.
“We find that many motorists, including many legislators, simply do not know much about how premium is calculated, nor do they understand why insurers use certain factors to determine premium,” he said. “However, once it is explained to them that the use of this information allows their insurer to charge them a more accurate rate, including for most people a lower rate when credit information is considered, then we find that most support that use.”
PCI also refutes CFA’s recommendation that insurers be regulated further, according to Hageli, who added that the best way to lower rates is to diversify the market.
“Consumers benefit with lower rates, more choices and greater market stability when insurers are able to use the most accurate underwriting and rating tools available,” Hageli said. “If restrictions are placed on insurers’ rating factors, then what will happen is that lower-risk consumers end up paying more in order to offset premium decreases given to higher-risk consumers.”
The Insurance Information Institute also spoke out publicly against the survey’s results.
With Quote Analysis, CFA Claims Premiums Are Unjustly Inflated by Factors
In a separate analysis using several car insurance quotes from websites of State Farm, Allstate, GEICO, Progressive and Farmer’s, CFA found that those non-driving factors taken together could increase premiums for low- and moderate-income motorists “often by more than 100 percent.” The profile used in those quotes was a 35-year-old woman with a good driving record seeking minimum liability coverage in Baltimore, Miami, Louisville, Houston and Los Angeles.
“The fact that these families often can’t obtain this coverage helps explain why so many risk fines, or even imprisonment, by driving without insurance,” Brobeck said.
In January, the CFA published a report saying that that rates could be made “fairer, lower and more affordable” if regulators “severely restrict auto insurers from using factors unrelated to driving.”
The survey was conducted by ORC International for the Consumer Federation of America (CFA) and included responses from 1,100 people. Factors that those surveyed find to be unjustified include education levels and presence of previous coverage.
“These factors have nothing to do with driving and discriminate against lower-income drivers,” Stephen Brobeck, CFA executive director, said in a statement. “Premiums should largely reflect factors … over which drivers have some control and which directly affect insurer costs.”
The question posed to respondents was: “How fair do you think it is for insurers to use each of the following factors in deciding on an auto insurance price for a driver?”
A policyholder’s number of traffic accidents was the top factor in the survey that respondents said was a “very” or “somewhat” fair factor, with 87 percent. Meanwhile, gender was at the bottom of the pile, with only 30 percent responding that it was a justifiable factor used in insurance rate pricing.
The survey’s complete listing is as follows, with the percentage of respondents saying the factor was “very” or “somewhat” fair:
–Traffic accidents caused: 87 percent
–Moving violations like speeding tickets: 85 percent
–Number of years with a license: 74 percent
–Age: 66 percent
–Miles driven: 61 percent
–Location of residence: 45 percent
–Occupation: 33 percent
–No previous insurance because no car: 32 percent
–Level of education: 31 percent
–Credit score: 31 percent
–Gender: 30 percent
Insurers Rebut CFA, Say Using Range of Factors Necessary
The Property Casualty Insurers Association of America (PCI), which represents 1,000 insurers in what is the industry’s largest trade group, called the CFA’s latest findings a “mostly misguided public policy prescription” that would be “counterproductive and hurt most motorists, resulting in higher costs and fewer choices for all consumers.”
Non-driving factors play just as important as driving-related factors in the complex method of pricing coverage, according to PCI.
“When blended together, these factors help to ensure that low-risk consumers can be better identified and pay less for insurance,” Alex Hageli, PCI director of personal lines, said in a statement.
Pricing methods are so complex, Hageli said, that the response from consumers in the survey was unsurprising.
“We find that many motorists, including many legislators, simply do not know much about how premium is calculated, nor do they understand why insurers use certain factors to determine premium,” he said. “However, once it is explained to them that the use of this information allows their insurer to charge them a more accurate rate, including for most people a lower rate when credit information is considered, then we find that most support that use.”
PCI also refutes CFA’s recommendation that insurers be regulated further, according to Hageli, who added that the best way to lower rates is to diversify the market.
“Consumers benefit with lower rates, more choices and greater market stability when insurers are able to use the most accurate underwriting and rating tools available,” Hageli said. “If restrictions are placed on insurers’ rating factors, then what will happen is that lower-risk consumers end up paying more in order to offset premium decreases given to higher-risk consumers.”
The Insurance Information Institute also spoke out publicly against the survey’s results.
With Quote Analysis, CFA Claims Premiums Are Unjustly Inflated by Factors
In a separate analysis using several car insurance quotes from websites of State Farm, Allstate, GEICO, Progressive and Farmer’s, CFA found that those non-driving factors taken together could increase premiums for low- and moderate-income motorists “often by more than 100 percent.” The profile used in those quotes was a 35-year-old woman with a good driving record seeking minimum liability coverage in Baltimore, Miami, Louisville, Houston and Los Angeles.
“The fact that these families often can’t obtain this coverage helps explain why so many risk fines, or even imprisonment, by driving without insurance,” Brobeck said.
In January, the CFA published a report saying that that rates could be made “fairer, lower and more affordable” if regulators “severely restrict auto insurers from using factors unrelated to driving.”
Survey: Non-driving Insurance Pricing Factors a Consumer Turnoff
A nationwide survey of consumers shows they find
it unfair that factors unrelated to driving play a part in how much
they’re charged for auto coverage, while insurers refuted the results
from the survey, saying the pricing process is complex and that use of
non-driving factors is necessary.
The survey was conducted by ORC International for the Consumer Federation of America (CFA) and included responses from 1,100 people. Factors that those surveyed find to be unjustified include education levels and presence of previous coverage.
“These factors have nothing to do with driving and discriminate against lower-income drivers,” Stephen Brobeck, CFA executive director, said in a statement. “Premiums should largely reflect factors … over which drivers have some control and which directly affect insurer costs.”
The question posed to respondents was: “How fair do you think it is for insurers to use each of the following factors in deciding on an auto insurance price for a driver?”
A policyholder’s number of traffic accidents was the top factor in the survey that respondents said was a “very” or “somewhat” fair factor, with 87 percent. Meanwhile, gender was at the bottom of the pile, with only 30 percent responding that it was a justifiable factor used in insurance rate pricing.
The survey’s complete listing is as follows, with the percentage of respondents saying the factor was “very” or “somewhat” fair:
–Traffic accidents caused: 87 percent
–Moving violations like speeding tickets: 85 percent
–Number of years with a license: 74 percent
–Age: 66 percent
–Miles driven: 61 percent
–Location of residence: 45 percent
–Occupation: 33 percent
–No previous insurance because no car: 32 percent
–Level of education: 31 percent
–Credit score: 31 percent
–Gender: 30 percent
Insurers Rebut CFA, Say Using Range of Factors Necessary
The Property Casualty Insurers Association of America (PCI), which represents 1,000 insurers in what is the industry’s largest trade group, called the CFA’s latest findings a “mostly misguided public policy prescription” that would be “counterproductive and hurt most motorists, resulting in higher costs and fewer choices for all consumers.”
Non-driving factors play just as important as driving-related factors in the complex method of pricing coverage, according to PCI.
“When blended together, these factors help to ensure that low-risk consumers can be better identified and pay less for insurance,” Alex Hageli, PCI director of personal lines, said in a statement.
Pricing methods are so complex, Hageli said, that the response from consumers in the survey was unsurprising.
“We find that many motorists, including many legislators, simply do not know much about how premium is calculated, nor do they understand why insurers use certain factors to determine premium,” he said. “However, once it is explained to them that the use of this information allows their insurer to charge them a more accurate rate, including for most people a lower rate when credit information is considered, then we find that most support that use.”
PCI also refutes CFA’s recommendation that insurers be regulated further, according to Hageli, who added that the best way to lower rates is to diversify the market.
“Consumers benefit with lower rates, more choices and greater market stability when insurers are able to use the most accurate underwriting and rating tools available,” Hageli said. “If restrictions are placed on insurers’ rating factors, then what will happen is that lower-risk consumers end up paying more in order to offset premium decreases given to higher-risk consumers.”
The Insurance Information Institute also spoke out publicly against the survey’s results.
With Quote Analysis, CFA Claims Premiums Are Unjustly Inflated by Factors
In a separate analysis using several car insurance quotes from websites of State Farm, Allstate, GEICO, Progressive and Farmer’s, CFA found that those non-driving factors taken together could increase premiums for low- and moderate-income motorists “often by more than 100 percent.” The profile used in those quotes was a 35-year-old woman with a good driving record seeking minimum liability coverage in Baltimore, Miami, Louisville, Houston and Los Angeles.
“The fact that these families often can’t obtain this coverage helps explain why so many risk fines, or even imprisonment, by driving without insurance,” Brobeck said.
In January, the CFA published a report saying that that rates could be made “fairer, lower and more affordable” if regulators “severely restrict auto insurers from using factors unrelated to driving.”
The survey was conducted by ORC International for the Consumer Federation of America (CFA) and included responses from 1,100 people. Factors that those surveyed find to be unjustified include education levels and presence of previous coverage.
“These factors have nothing to do with driving and discriminate against lower-income drivers,” Stephen Brobeck, CFA executive director, said in a statement. “Premiums should largely reflect factors … over which drivers have some control and which directly affect insurer costs.”
The question posed to respondents was: “How fair do you think it is for insurers to use each of the following factors in deciding on an auto insurance price for a driver?”
A policyholder’s number of traffic accidents was the top factor in the survey that respondents said was a “very” or “somewhat” fair factor, with 87 percent. Meanwhile, gender was at the bottom of the pile, with only 30 percent responding that it was a justifiable factor used in insurance rate pricing.
The survey’s complete listing is as follows, with the percentage of respondents saying the factor was “very” or “somewhat” fair:
–Traffic accidents caused: 87 percent
–Moving violations like speeding tickets: 85 percent
–Number of years with a license: 74 percent
–Age: 66 percent
–Miles driven: 61 percent
–Location of residence: 45 percent
–Occupation: 33 percent
–No previous insurance because no car: 32 percent
–Level of education: 31 percent
–Credit score: 31 percent
–Gender: 30 percent
Insurers Rebut CFA, Say Using Range of Factors Necessary
The Property Casualty Insurers Association of America (PCI), which represents 1,000 insurers in what is the industry’s largest trade group, called the CFA’s latest findings a “mostly misguided public policy prescription” that would be “counterproductive and hurt most motorists, resulting in higher costs and fewer choices for all consumers.”
Non-driving factors play just as important as driving-related factors in the complex method of pricing coverage, according to PCI.
“When blended together, these factors help to ensure that low-risk consumers can be better identified and pay less for insurance,” Alex Hageli, PCI director of personal lines, said in a statement.
Pricing methods are so complex, Hageli said, that the response from consumers in the survey was unsurprising.
“We find that many motorists, including many legislators, simply do not know much about how premium is calculated, nor do they understand why insurers use certain factors to determine premium,” he said. “However, once it is explained to them that the use of this information allows their insurer to charge them a more accurate rate, including for most people a lower rate when credit information is considered, then we find that most support that use.”
PCI also refutes CFA’s recommendation that insurers be regulated further, according to Hageli, who added that the best way to lower rates is to diversify the market.
“Consumers benefit with lower rates, more choices and greater market stability when insurers are able to use the most accurate underwriting and rating tools available,” Hageli said. “If restrictions are placed on insurers’ rating factors, then what will happen is that lower-risk consumers end up paying more in order to offset premium decreases given to higher-risk consumers.”
The Insurance Information Institute also spoke out publicly against the survey’s results.
With Quote Analysis, CFA Claims Premiums Are Unjustly Inflated by Factors
In a separate analysis using several car insurance quotes from websites of State Farm, Allstate, GEICO, Progressive and Farmer’s, CFA found that those non-driving factors taken together could increase premiums for low- and moderate-income motorists “often by more than 100 percent.” The profile used in those quotes was a 35-year-old woman with a good driving record seeking minimum liability coverage in Baltimore, Miami, Louisville, Houston and Los Angeles.
“The fact that these families often can’t obtain this coverage helps explain why so many risk fines, or even imprisonment, by driving without insurance,” Brobeck said.
In January, the CFA published a report saying that that rates could be made “fairer, lower and more affordable” if regulators “severely restrict auto insurers from using factors unrelated to driving.”
Survey: Non-driving Insurance Pricing Factors a Consumer Turnoff
A nationwide survey of consumers shows they find
it unfair that factors unrelated to driving play a part in how much
they’re charged for auto coverage, while insurers refuted the results
from the survey, saying the pricing process is complex and that use of
non-driving factors is necessary.
The survey was conducted by ORC International for the Consumer Federation of America (CFA) and included responses from 1,100 people. Factors that those surveyed find to be unjustified include education levels and presence of previous coverage.
“These factors have nothing to do with driving and discriminate against lower-income drivers,” Stephen Brobeck, CFA executive director, said in a statement. “Premiums should largely reflect factors … over which drivers have some control and which directly affect insurer costs.”
The question posed to respondents was: “How fair do you think it is for insurers to use each of the following factors in deciding on an auto insurance price for a driver?”
A policyholder’s number of traffic accidents was the top factor in the survey that respondents said was a “very” or “somewhat” fair factor, with 87 percent. Meanwhile, gender was at the bottom of the pile, with only 30 percent responding that it was a justifiable factor used in insurance rate pricing.
The survey’s complete listing is as follows, with the percentage of respondents saying the factor was “very” or “somewhat” fair:
–Traffic accidents caused: 87 percent
–Moving violations like speeding tickets: 85 percent
–Number of years with a license: 74 percent
–Age: 66 percent
–Miles driven: 61 percent
–Location of residence: 45 percent
–Occupation: 33 percent
–No previous insurance because no car: 32 percent
–Level of education: 31 percent
–Credit score: 31 percent
–Gender: 30 percent
Insurers Rebut CFA, Say Using Range of Factors Necessary
The Property Casualty Insurers Association of America (PCI), which represents 1,000 insurers in what is the industry’s largest trade group, called the CFA’s latest findings a “mostly misguided public policy prescription” that would be “counterproductive and hurt most motorists, resulting in higher costs and fewer choices for all consumers.”
Non-driving factors play just as important as driving-related factors in the complex method of pricing coverage, according to PCI.
“When blended together, these factors help to ensure that low-risk consumers can be better identified and pay less for insurance,” Alex Hageli, PCI director of personal lines, said in a statement.
Pricing methods are so complex, Hageli said, that the response from consumers in the survey was unsurprising.
“We find that many motorists, including many legislators, simply do not know much about how premium is calculated, nor do they understand why insurers use certain factors to determine premium,” he said. “However, once it is explained to them that the use of this information allows their insurer to charge them a more accurate rate, including for most people a lower rate when credit information is considered, then we find that most support that use.”
PCI also refutes CFA’s recommendation that insurers be regulated further, according to Hageli, who added that the best way to lower rates is to diversify the market.
“Consumers benefit with lower rates, more choices and greater market stability when insurers are able to use the most accurate underwriting and rating tools available,” Hageli said. “If restrictions are placed on insurers’ rating factors, then what will happen is that lower-risk consumers end up paying more in order to offset premium decreases given to higher-risk consumers.”
The Insurance Information Institute also spoke out publicly against the survey’s results.
With Quote Analysis, CFA Claims Premiums Are Unjustly Inflated by Factors
In a separate analysis using several car insurance quotes from websites of State Farm, Allstate, GEICO, Progressive and Farmer’s, CFA found that those non-driving factors taken together could increase premiums for low- and moderate-income motorists “often by more than 100 percent.” The profile used in those quotes was a 35-year-old woman with a good driving record seeking minimum liability coverage in Baltimore, Miami, Louisville, Houston and Los Angeles.
“The fact that these families often can’t obtain this coverage helps explain why so many risk fines, or even imprisonment, by driving without insurance,” Brobeck said.
In January, the CFA published a report saying that that rates could be made “fairer, lower and more affordable” if regulators “severely restrict auto insurers from using factors unrelated to driving.”
The survey was conducted by ORC International for the Consumer Federation of America (CFA) and included responses from 1,100 people. Factors that those surveyed find to be unjustified include education levels and presence of previous coverage.
“These factors have nothing to do with driving and discriminate against lower-income drivers,” Stephen Brobeck, CFA executive director, said in a statement. “Premiums should largely reflect factors … over which drivers have some control and which directly affect insurer costs.”
The question posed to respondents was: “How fair do you think it is for insurers to use each of the following factors in deciding on an auto insurance price for a driver?”
A policyholder’s number of traffic accidents was the top factor in the survey that respondents said was a “very” or “somewhat” fair factor, with 87 percent. Meanwhile, gender was at the bottom of the pile, with only 30 percent responding that it was a justifiable factor used in insurance rate pricing.
The survey’s complete listing is as follows, with the percentage of respondents saying the factor was “very” or “somewhat” fair:
–Traffic accidents caused: 87 percent
–Moving violations like speeding tickets: 85 percent
–Number of years with a license: 74 percent
–Age: 66 percent
–Miles driven: 61 percent
–Location of residence: 45 percent
–Occupation: 33 percent
–No previous insurance because no car: 32 percent
–Level of education: 31 percent
–Credit score: 31 percent
–Gender: 30 percent
Insurers Rebut CFA, Say Using Range of Factors Necessary
The Property Casualty Insurers Association of America (PCI), which represents 1,000 insurers in what is the industry’s largest trade group, called the CFA’s latest findings a “mostly misguided public policy prescription” that would be “counterproductive and hurt most motorists, resulting in higher costs and fewer choices for all consumers.”
Non-driving factors play just as important as driving-related factors in the complex method of pricing coverage, according to PCI.
“When blended together, these factors help to ensure that low-risk consumers can be better identified and pay less for insurance,” Alex Hageli, PCI director of personal lines, said in a statement.
Pricing methods are so complex, Hageli said, that the response from consumers in the survey was unsurprising.
“We find that many motorists, including many legislators, simply do not know much about how premium is calculated, nor do they understand why insurers use certain factors to determine premium,” he said. “However, once it is explained to them that the use of this information allows their insurer to charge them a more accurate rate, including for most people a lower rate when credit information is considered, then we find that most support that use.”
PCI also refutes CFA’s recommendation that insurers be regulated further, according to Hageli, who added that the best way to lower rates is to diversify the market.
“Consumers benefit with lower rates, more choices and greater market stability when insurers are able to use the most accurate underwriting and rating tools available,” Hageli said. “If restrictions are placed on insurers’ rating factors, then what will happen is that lower-risk consumers end up paying more in order to offset premium decreases given to higher-risk consumers.”
The Insurance Information Institute also spoke out publicly against the survey’s results.
With Quote Analysis, CFA Claims Premiums Are Unjustly Inflated by Factors
In a separate analysis using several car insurance quotes from websites of State Farm, Allstate, GEICO, Progressive and Farmer’s, CFA found that those non-driving factors taken together could increase premiums for low- and moderate-income motorists “often by more than 100 percent.” The profile used in those quotes was a 35-year-old woman with a good driving record seeking minimum liability coverage in Baltimore, Miami, Louisville, Houston and Los Angeles.
“The fact that these families often can’t obtain this coverage helps explain why so many risk fines, or even imprisonment, by driving without insurance,” Brobeck said.
In January, the CFA published a report saying that that rates could be made “fairer, lower and more affordable” if regulators “severely restrict auto insurers from using factors unrelated to driving.”
Survey: Non-driving Insurance Pricing Factors a Consumer Turnoff
A nationwide survey of consumers shows they find
it unfair that factors unrelated to driving play a part in how much
they’re charged for auto coverage, while insurers refuted the results
from the survey, saying the pricing process is complex and that use of
non-driving factors is necessary.
The survey was conducted by ORC International for the Consumer Federation of America (CFA) and included responses from 1,100 people. Factors that those surveyed find to be unjustified include education levels and presence of previous coverage.
“These factors have nothing to do with driving and discriminate against lower-income drivers,” Stephen Brobeck, CFA executive director, said in a statement. “Premiums should largely reflect factors … over which drivers have some control and which directly affect insurer costs.”
The question posed to respondents was: “How fair do you think it is for insurers to use each of the following factors in deciding on an auto insurance price for a driver?”
A policyholder’s number of traffic accidents was the top factor in the survey that respondents said was a “very” or “somewhat” fair factor, with 87 percent. Meanwhile, gender was at the bottom of the pile, with only 30 percent responding that it was a justifiable factor used in insurance rate pricing.
The survey’s complete listing is as follows, with the percentage of respondents saying the factor was “very” or “somewhat” fair:
–Traffic accidents caused: 87 percent
–Moving violations like speeding tickets: 85 percent
–Number of years with a license: 74 percent
–Age: 66 percent
–Miles driven: 61 percent
–Location of residence: 45 percent
–Occupation: 33 percent
–No previous insurance because no car: 32 percent
–Level of education: 31 percent
–Credit score: 31 percent
–Gender: 30 percent
Insurers Rebut CFA, Say Using Range of Factors Necessary
The Property Casualty Insurers Association of America (PCI), which represents 1,000 insurers in what is the industry’s largest trade group, called the CFA’s latest findings a “mostly misguided public policy prescription” that would be “counterproductive and hurt most motorists, resulting in higher costs and fewer choices for all consumers.”
Non-driving factors play just as important as driving-related factors in the complex method of pricing coverage, according to PCI.
“When blended together, these factors help to ensure that low-risk consumers can be better identified and pay less for insurance,” Alex Hageli, PCI director of personal lines, said in a statement.
Pricing methods are so complex, Hageli said, that the response from consumers in the survey was unsurprising.
“We find that many motorists, including many legislators, simply do not know much about how premium is calculated, nor do they understand why insurers use certain factors to determine premium,” he said. “However, once it is explained to them that the use of this information allows their insurer to charge them a more accurate rate, including for most people a lower rate when credit information is considered, then we find that most support that use.”
PCI also refutes CFA’s recommendation that insurers be regulated further, according to Hageli, who added that the best way to lower rates is to diversify the market.
“Consumers benefit with lower rates, more choices and greater market stability when insurers are able to use the most accurate underwriting and rating tools available,” Hageli said. “If restrictions are placed on insurers’ rating factors, then what will happen is that lower-risk consumers end up paying more in order to offset premium decreases given to higher-risk consumers.”
The Insurance Information Institute also spoke out publicly against the survey’s results.
With Quote Analysis, CFA Claims Premiums Are Unjustly Inflated by Factors
In a separate analysis using several car insurance quotes from websites of State Farm, Allstate, GEICO, Progressive and Farmer’s, CFA found that those non-driving factors taken together could increase premiums for low- and moderate-income motorists “often by more than 100 percent.” The profile used in those quotes was a 35-year-old woman with a good driving record seeking minimum liability coverage in Baltimore, Miami, Louisville, Houston and Los Angeles.
“The fact that these families often can’t obtain this coverage helps explain why so many risk fines, or even imprisonment, by driving without insurance,” Brobeck said.
In January, the CFA published a report saying that that rates could be made “fairer, lower and more affordable” if regulators “severely restrict auto insurers from using factors unrelated to driving.”
The survey was conducted by ORC International for the Consumer Federation of America (CFA) and included responses from 1,100 people. Factors that those surveyed find to be unjustified include education levels and presence of previous coverage.
“These factors have nothing to do with driving and discriminate against lower-income drivers,” Stephen Brobeck, CFA executive director, said in a statement. “Premiums should largely reflect factors … over which drivers have some control and which directly affect insurer costs.”
The question posed to respondents was: “How fair do you think it is for insurers to use each of the following factors in deciding on an auto insurance price for a driver?”
A policyholder’s number of traffic accidents was the top factor in the survey that respondents said was a “very” or “somewhat” fair factor, with 87 percent. Meanwhile, gender was at the bottom of the pile, with only 30 percent responding that it was a justifiable factor used in insurance rate pricing.
The survey’s complete listing is as follows, with the percentage of respondents saying the factor was “very” or “somewhat” fair:
–Traffic accidents caused: 87 percent
–Moving violations like speeding tickets: 85 percent
–Number of years with a license: 74 percent
–Age: 66 percent
–Miles driven: 61 percent
–Location of residence: 45 percent
–Occupation: 33 percent
–No previous insurance because no car: 32 percent
–Level of education: 31 percent
–Credit score: 31 percent
–Gender: 30 percent
Insurers Rebut CFA, Say Using Range of Factors Necessary
The Property Casualty Insurers Association of America (PCI), which represents 1,000 insurers in what is the industry’s largest trade group, called the CFA’s latest findings a “mostly misguided public policy prescription” that would be “counterproductive and hurt most motorists, resulting in higher costs and fewer choices for all consumers.”
Non-driving factors play just as important as driving-related factors in the complex method of pricing coverage, according to PCI.
“When blended together, these factors help to ensure that low-risk consumers can be better identified and pay less for insurance,” Alex Hageli, PCI director of personal lines, said in a statement.
Pricing methods are so complex, Hageli said, that the response from consumers in the survey was unsurprising.
“We find that many motorists, including many legislators, simply do not know much about how premium is calculated, nor do they understand why insurers use certain factors to determine premium,” he said. “However, once it is explained to them that the use of this information allows their insurer to charge them a more accurate rate, including for most people a lower rate when credit information is considered, then we find that most support that use.”
PCI also refutes CFA’s recommendation that insurers be regulated further, according to Hageli, who added that the best way to lower rates is to diversify the market.
“Consumers benefit with lower rates, more choices and greater market stability when insurers are able to use the most accurate underwriting and rating tools available,” Hageli said. “If restrictions are placed on insurers’ rating factors, then what will happen is that lower-risk consumers end up paying more in order to offset premium decreases given to higher-risk consumers.”
The Insurance Information Institute also spoke out publicly against the survey’s results.
With Quote Analysis, CFA Claims Premiums Are Unjustly Inflated by Factors
In a separate analysis using several car insurance quotes from websites of State Farm, Allstate, GEICO, Progressive and Farmer’s, CFA found that those non-driving factors taken together could increase premiums for low- and moderate-income motorists “often by more than 100 percent.” The profile used in those quotes was a 35-year-old woman with a good driving record seeking minimum liability coverage in Baltimore, Miami, Louisville, Houston and Los Angeles.
“The fact that these families often can’t obtain this coverage helps explain why so many risk fines, or even imprisonment, by driving without insurance,” Brobeck said.
In January, the CFA published a report saying that that rates could be made “fairer, lower and more affordable” if regulators “severely restrict auto insurers from using factors unrelated to driving.”
Pennsylvania Reports Insurance Rate Hikes for October
The latest batch of filings from Pennsylvania regulators, consisting mostly of hikes to insurance prices, means that consumers retrieving an auto insurance quote online could see a handful of new, higher rates.The following filings were approved and take effect this month.
Horace Mann, Progressive Companies Hike Rates
Two companies under the Progressive banner will be increasing insurance rates, both by 6.8 percent overall. At Progressive Casualty, that change amounts to a $50.70 increase per policyholder on average. At Progressive Northern, it amounts to a $70.29 average increase for each policyholder.
The Progressive increases take effect Oct. 5 for new policyholders but won’t affect those renewing policies until Nov. 14. At least 24,000 Progressive policyholders will be affected by the change.
Horace Mann and subsidiaries Horace Mann Property and Casualty and Teachers Insurance Company will all be implementing rate increases that will go into effect for all policyholders on Oct. 16. Horace Mann’s 1.7 percent increase overall means about a $14 average increase for each of the 5,370 policyholders affected.
Horace Mann Property and Casualty raised overall rates by 5 percent for about 11,300 policyholders, amounting to a $33.44 average increase for each.
At Teachers, rates will be hiked by 2 percent overall, amounting to an average $12.82 increase for about 5,370 customers.
Other Companies Post High Average Per-Policyholder Increases
Hartford of Illinois showed the largest average increase per policyholder, at $231.90. The 8.4 percent overall rate increase takes effect on Oct. 6 for both new and renewing policyholders but will only impact upwards of about 1,250 of them.
Integon Indemnity reported the second-highest overall rate increase out of the filings, at 7.3 percent. The 8,540 policyholders affected will see an average increase of $74.27.
Out of this latest batch of filings, Metropolitan Casualty also reported a relatively large average increase for each policyholder. The insurer’s 5.4 percent increase impacting 9,250 policyholders means an average increase of $87.62 for each policyholder. The changes are effective Oct. 11 for renewing policyholders and are already in effect for new customers.
GEICO Casualty Decreases Rates
GEICO Casualty has decreased overall rates for 13,480 policyholders by 2 percent, amounting to an average decrease of $37.79 per policyholder. The changes went into effect in August for new customers and on Oct. 1 for renewing customers.
Allstate Insurance Sued Over Esurance Purchase Terms
White
Mountains Insurance Group filed a lawsuit against Allstate this week
claiming the nation’s second-largest insurance company broke contractual
obligations when it bought Esurance in a billion-dollar sale last October.In the federal lawsuit, filed Monday with the U.S. District Court for the Southern District of New York, White Mountains alleges that Allstate breached its contract by improperly adjusting the final purchase price.
According to court documents, the agreement was that Allstate would pay $700 million plus an additional amount to acquire Esurance.
A clause in Allstate’s purchasing contract required the insurer to adhere to a “two-stage process” that would determine the additional payment made to White Mountains, which would be based on the book value of Esurance. The initial payment would be determined by White Mountains’ assessment of the book value and be made upon the closing of the deal, which was on Oct. 7 of last year. After that closing date, the contract required a “Purchase Price Adjustment” that would settle the difference between the estimate and actual book value.
White Mountains claims that Allstate was almost five months late in auditing its balance sheet for the purchase, missing a “firm 90-day deadline after the closing.”
Allstate then proposed to cut $5.2 million from the book value based on an unrelated settlement Esurance had to pay in April 2012, which was technically after the 90-day deadline.
“It is improper for Allstate to adjust the [Oct. 7] tangible book value, and thus change the purchase price, based on events that occurred long after [Oct. 7],” White Mountains stated in the suit. “Had Allstate met the contractual deadline, the $5.2 million payment in April 2012 would not and could not have been included.”
As a top rated auto insurance company, Allstate holds the second-largest market share in the auto coverage industry with about 10 percent, according to the most recent data from the National Association of Insurance Commissioners. GEICO and Progressive closely trail in market share with about 9 percent and 8 percent, respectively.
Judge George B. Daniels is presiding over the case, named White Mountains Holdings (Luxembourg) S.a.r.l. vs. The Allstate Corp.
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