When each company is permitted to develop its own area rating maps, slicing the state into as many as 50 unique pieces, it seems likely that chaos will follow. Yes, the rating territories need some serious tweaking to reflect current reality. Do we really need to allow each company to draw up maps based on their own small share of overall experience, especially in areas where they may have only minimal market penetration? Everyone will love the big winners that manage to turn a nice profit while still reducing their overall rates. But who will tolerate the losers that inevitably will leave their customers in an unhappy situation? Wouldn’t some companies find a way to avoid writing a fair share of riskier business by overpricing in more undesirable areas while underpricing in the more attractive areas? Yes, the rating territories should be modernized, but all companies should be using the same maps and compete on the basis of their tier rating, base rates and customer service.
— Vincent L. Silenzio, Maple Shade, N.J.
Topics Auto Pricing Trends New Jersey
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