Higher Gas Prices, Lighter Vehicles Could Mean Higher Insurance Costs

August 27, 2008

  • August 27, 2008 at 8:57 am
    Pud says:
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    Here we go again! The insurance companies are now going to raise rates if the consumer with small cars and the people who can afford it the least.
    Who is running these companies anyway? They push the auto manufacturers to make safer cars.They conform and now the companies are saying the cars aren;t safe that we should be driving the big gass guzzlers? I mean what gives here.Can these guys make their minds up.It’s no wonder they keep increasing rates because of mismanagement of money.
    When will this madness stop?

  • August 27, 2008 at 9:08 am
    Pud says:
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    You figure insurance companies get AT LEAST a minimum of $1k per household of the residents of this country.
    Families with 2 children are paying more than 4 times that.
    I really wish I could be one of the people figuring out these statistics.
    It takes a real freakin genious to figure this stuff out.
    Small car,more damage,more and severe injuries.Front end hits are more prevalent than rear end hits.Lexus parts cost more than Honda.I could go on and on.
    I’d rather be broad sided in a full size four door full frame pickup than a Honda Fit!This is a no brainer.
    Just another desperate action by insurance companies to pry more money from the public’s pockets.

  • August 27, 2008 at 10:17 am
    Jake says:
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    There are several additional factors that weigh on the premiums. The fact that fuel prices have increased has indeed resulted in a decrease in miles driven which in theory sounds like it would decrease overall risk and therefor decrease premiums….not the case….

    As the fuel prices increase so do the cost to replace petrolium based auto parts…anything plastic.

    The higher fuel prices are putting a tighter pinch on consumer’s wallets and the claim that that insured would have retained 1 or 2 years ago will now be submitted.

    The higher fuel prices are leading to increases in car-pooling. So now instead of a single person being injured in a 1 car auto accident, there is a risk of up to 5 or more people being injured in that same accident.

    Hope this makes you feel better about paying your monthly auto insurance installment.

  • August 27, 2008 at 12:03 pm
    Jeff the Cynic says:
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    What, no comments from the Greedy Insurance Company Gang about how companies are ripping off consumers for not dropping rates the day after average miles driven by average drivers is reported? Where’s Robert Hunter’s self-serving commentary?

    Thanks for another side to the story IJ.

  • August 27, 2008 at 12:29 pm
    Old Data says:
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    I have a feeling that these numbers will become irrelevant.

    1. A study just came out that the number of fatalities this year will be the lowest since the early 1960s.

    2. I am guessing that the higher cost is due to the lighter cars being steamrolled by the heavy cars/suvs. If a true reduction of the number of those heavy cars on the road happens, then the cost will go down as the number of light car/heavy car accidents decrease.

    Time will tell.

  • August 27, 2008 at 12:29 pm
    Curious says:
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    What Ms. Sprinkle fails to comment upon is how many of those lighter-weight vehicles that incurred significant property/bodily injury damage were involved in an accident with those larger vehicles that received less damage. As more and more gass guzzlers are removed from the roads, I would suspect it will have a positive impact on the little guys.

  • August 27, 2008 at 1:37 am
    Art says:
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    I agree with “Not enough info” and “Not sure about these numbers”. We also need to know the number of those large vehicle accidents per million miles driven compared to the number of smaller vehicle accidents per million miles driver.

  • August 27, 2008 at 2:19 am
    Stat Guy says:
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    and they should be cautioned against making any causal links between the drop in miles driven, lighter vehicles, speed limits…it is far too early to tell but people love to speculate and make assumptions before all the data is in and interpreted; you know the drill about lies, damned lies and statistics…..:-)

  • August 27, 2008 at 2:21 am
    Contradictory says:
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    Like the previous posters state, this seems contradictory to the article the other day about costs going down because of mileage driven, etc. Maybe the Missouri attitude of “Wait and see” might help, tempered with some common sense (whoops, sorry).

  • August 27, 2008 at 2:38 am
    Cynic says:
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    Any new development raises insurance rates, get used to it. As long as there are sue happy attorneys rates will go nowhere but up.

  • August 27, 2008 at 3:06 am
    nobody important says:
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    There are going to be large trucks on the highway and one car accidents. Smaller cars are not as safe as big cars in an accident. It’s a trade off for better mileage. There are a lot of factors that make up rates.

  • August 28, 2008 at 7:03 am
    Pud says:
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    BTW, Our statistics guy earlier in the dialog can possibly research this.I believe there was a major increase in auto premiums after all these safety features were added (to protect US in the event of an impact)why you ask because the insurance companies said that the parts that are being destroyed by these safety features are causing major damage to interior parts and they cost a lot of money to replace because we can’t use used we have to use new there is a liability and performance issue with used.
    I got news for ya new fails and doesn;t work worth a crap either! All this money spent for nothing because of NHSA and the insurance industry!

  • August 28, 2008 at 7:25 am
    nobody important says:
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    Don’t bother Jake. PUD is a long time insurance company hater. We do nothing right and cheat everyone. We should all be in jail. He has no knowledge of insurance and appears to be proud of it. A real self important moron. When I was a kid, a pud was a specific part of the anatomy and you didn’t want to be called a pud. Seems to fit. Facts are made up according to him. We have no justification for our existence.

  • August 28, 2008 at 1:29 am
    Pud says:
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    Now now Nobody.Don’t get nasty! I thought we had this retaliation understanding worked out.It’s not insurance agents I dislike,I hate almost nothing, it’s the executives pay method I am adamantly against.I dislike hearing how poor they are and how they need rate increases as a result of legislation they helped push through the house and when they are distributing bonus’ that could be directed towards policy holders claims.
    (mismanagement of money and greed)
    They are reaching at every angle they possibly can right now just to find ways to increase the rates of consumers because they gave themselves such fat bonus’ in the past.
    In my opinion other than the CAT losses you have seen in the midwest and other areas affected by mother nature it’s been smooth sailing for insurance companies.
    So again don’t get nasty I am merely stating fact that you disagree with.I believe it was you that claimed to have 25 years in the business well I do as well just another area.
    I worked with sales people and agents and to be honest a lot of agents knew nothing except that if they wrote large volume books they got what they wanted because the insurance company didn’t want to loose them. Look what happened to Marsh & McClennan in Ny. Greed has no boundries and does bite your backside after a while.This is what is currently going on in the inductry now! Prove me wrong! I’ve asked you over and over for proof of your claims and nothing but slander has surfaced so zip it if you can’t do anything more than slander!

  • August 28, 2008 at 2:03 am
    Pud says:
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    Read todays headlines:

    The U.S. property/casualty insurance industry reported mixed results in the first six months of 2008, according to a new Fitch report. Profitability declined due to poor investment performance and deteriorating accident-year underwriting results, which were partially offset by favorable prior years’ loss reserve development.

    Advertisement
    While competitive factors are likely to promote further deterioration in rates, Fitch expects most insurers in its publicly traded universe to post a calendar-year underwriting profit in 2008, while accident-year results will shift closer to breakeven, assuming catastrophe activity in the second half of the year approximates historical averages.

    Fitch continues to expect that insurers’ overall profits will decline in 2008 and that the industry will struggle to produce an adequate return on capital, which Fitch estimates for most insurers as a net return on average equity of between 11 percent and 12 percent.

  • August 28, 2008 at 2:03 am
    nobody important says:
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    Pud, my proof is the ignorance of your letters. You have no information except you claim experience, but don’t show knowledge of the insurance business or business in general. You and others want to appoint yourselves the final arbiters of who makes what money, that’s fine. Do insurance company executives make more than executives in other types of industries? I doubt it. Do insurance companies have higher return on investment than other industries, not even close. Are insurance companies highly regulated in every state, absolutely. No other industry has the level of approval of every cent we charge the way insurance is regulated. Have insurance departments in some states become purely political? I have experience with that at my company. Insurance departments are supposed to do more than be consumer advocates, they are supposed to make certain that insurance companies remain solvent through accurate and adequate rating. That is not true any more. It’s all about what the customer wants to pay, not what the cost is to produce the product. Florida has designed a system that is bound to fail. It can’t succeed. Do I hear from you about that? No, just whining about companies paying executives too much and spending money on advertising the same way so many other industries do. Your positions are so much mush. I will not comment on anything you post again. I just warn anyone who would take the time to read this whole long diatribe, Pud and others like him are not informed and do not represent intelligent comment on the subject of insurance. Bye Pud.

  • August 28, 2008 at 2:08 am
    Pud says:
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    offer a forum to discuss. I am no expert never claimed to be. You are the one telling me I don;t have a clue and that my name resembles you you know what so c’mon this site is for dialog and your getting all ticked off at me for no reason!

  • August 28, 2008 at 6:57 am
    Pud says:
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    WOW Jake! Now that’s a stretch of the imaginination. If anything the oposite would occur! People do not have enough money to pay their deductibles,which BTW were increased to save insurance companies paying smaller claims, so now they likely won’t put any claim in at all.
    You are going to see more zebra cars. They will either get a recycled part if driveable,aftermarket and not paint it,have someone bump out any damage best they can or not get it repaired at all.

    This is just another ploy to keep from reducing the monies placed in the pockets of the big boys.
    The insurance companies told auto makers to make a safer car so they made the passenger compartment of HSS.Then they told them front end impacts are hurting people so you have to do something about that.The auto makers reacted by making HSS front uni-body rails that collapse and deaden impact somewhat prior to reaching the passenger copmpartment.The insurance companies then influenced the NHSA and said this is not good enough we have to have front air bags to protect the consumer in the event the HSS cage and HSS rails do not protect the passenger so the auto makers did. To nobodies surprise all of a sudden the insurance companies started seeing more severe injuries from side impacts,as well as NHSA and they told auto manufacturers you need to make HSS beams in doors and curtain air bags to protect the consumer from side impacts so they did!
    Bottom line is a car that cost relatively little to make and purchase is now a Bunch of recycled Beer and soda cans and isn;t worth the a hill of beans in a impact any fatser than 2-5 miles per hour.If smaller vehicle are hit at speeds any faster than that there is major damage.I mean after all what do you expect when bumper are made of styrofoam and plastic and the re-bars could be used as a fence post.
    Bottom line is corporate greed has created this monster and the same will continue unless people open their mouths and say enough is enough. No more lobbying the elected officials (you’ll notice I didn’t use our because they really do not have the consumers best interest in mind anymore)from insurance companies period!
    Stop the stock option bonus’ and insurance companies will be financially sound.Simple economics!

  • September 2, 2008 at 12:32 pm
    Reason says:
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    In English, “Pud” is just a slang term for the male genitalia but, did you know, in Punjabi “pud” means “fart”?

    Fascinating…

  • September 4, 2008 at 3:00 am
    k says:
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    I hope that the IRC takes a close look at the age relationship. I’ll bet a large percentage of youthful drivers are behind the wheel of light-weight vehicles.

  • September 4, 2008 at 3:19 am
    Rush says:
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    A parody of the Elvis song ‘In the Ghetto’.
    In a Yugo
    As the snow flies

    At a used car lot on the edge of town
    A liberal guy and a liberal gal
    Buy a Yugo

    And they drive with pride

    Cause if there’s one thing that this world needs
    It’s environmental friends who’ll take the lead
    In a Yugo

    They say, “people don’t you understand
    Those suburbans are ruining the land”
    But they’ll wish they had a full size van one day
    They point fingers at you and me
    They say we’re too blind to see
    But do we simply use our heads
    And choose another way?

    As those small wheels turn
    Fifty miles to the gallon
    And their knees on their chest
    They’re gonna save enough gas
    For all of the rest
    In a Yugo

    Then one day on the interstate
    They suddenly lose control
    They swerve to miss a baby duck
    They’re squashed beneath a produce truck

    But they drove with pride…

    And as the crowds drive past a little flat car
    You know they saved a lot of gas
    But they didnt get far
    In a Yugo

    And as they’re trapped inside
    At a used car lot on the other side of town
    A liberal guy and a liberal gal
    Buy a Yugo….

    And they drive with pride…

    ——————————————————————————–
    Performed by Paul Shanklin. Song and recording copyright Paul Shanklin. Paul has done tons of really funny song parodies. Visit his site to buy CDs of them.

  • September 4, 2008 at 3:29 am
    Kristine says:
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    I read the article regarding insurance costs associated with lighter private passenger vehicles than with hearvier vehicles. With the rising cost of gas prices and no reflief in site of prices going down, there is no choice for Americans to opt for smaller, lighter vehicles which provide better gas mileage (and should have been on the roadways long before the energy crisis!). I am not sure if the data derived from this report would support the need for higher insurance rates. Since more people will be utelizing smaller vehicles and, assuming the over the road exposure would be reduced to save on gas, I think data/statistics should be drived for a period in the future to make a more accurate determination of injuries from lighter vehicles. Also, it is common sense damage and injury to person(s) in an SUV or truck would typically be less if they were in an accident with a car, especially a lighter car. Was data collected regarding damage and injury to similar vehicles? I don’t think it is fair to prematurely raise rates for lightweight vehicles. With less and less SUVs and trucks to be on the roadways, it may very well be damage and injury will not be as severe to lightweight vehicles colliding. Send a message out for people to encourage reduced rates for accident-free “arrive alive” policies – I’d rather be late than dead!!



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