View this article online: https://www.insurancejournal.com/news/west/2008/07/08/91682.htm
As gas prices soar to more than $4 per gallon in Idaho, many residents are driving less, according to the Department of Insurance. Many people have started carpooling or using alternate means of transportation such as mass transit, scooters, bikes or even walking. Vacations are being converted to “staycations” where people are opting for activities close to home, the DOI indicated.
Consequently, Idaho Department of Insurance Director Bill Deal is advising consumers that, “Commuters who no longer drive to work may be eligible for an insurance rate reduction.” Vehicles previously rated for “drive to business or school” use may now be rated as “pleasure” use with a lower rate. The reduced driving can amount to an average savings of about 10 to 15 percent, he said, noting many insurers have several rate categories, depending on the number of miles driven per week.
Reducing those miles can result in a lower rating and lower insurance cost, he said. While some reductions in mileage may result in no savings at all, depending on the carrier, Deal urged consumers to contact their auto insurance agents to find out if they qualify for an immediate rate reduction.
He also noted that decreased driving should decrease the number of auto insurance claims that are filed. According to a study of the 1979-1980 energy crisis, Leroy Boison, a fellow of the Casualty Actuarial Society, found that, “The crisis did not just contribute to short-term reductions in auto claims frequency; it also contributed to a long-term decline.” Boison’s research showed that even after the political crisis had passed and gas prices decreased, claims frequency did not return to pre-crisis levels. This was due in part to creative drivers finding other means of getting around such as carpooling, public
transportation and consolidating errands, the DOI indicated.