JW in California a good driver has no more that one point on their record in the last three years. That can be a minor cite or a no BI accident. The discount is a mandatory 20%. A DUI takes away the discount for 10 yrs.
Being a good driver over the short term does not necessarily translate into being a good insurable risk over the long term. I believe that is related to the intent of this rule. Essentially they are forcing a classification based on a single rating variable.
The insurer is being forced to rate that risk, but can’t they still use other factors when calculating the rate? In other words, are the insurers losing money because of this rule?
In CA, personal auto is based on driving record, years of experience, miles driven (annually), type of usage (commute/pleasure/business). Physical damage rates can be based on garaging territory, repairability, anti-theft devicies, etc.
Prop 103 set out a specific set of criteria and the order in which rates were to be promulgated. What they didn’t say…. is areas where rates in CA were very low, rural areas, small towns, etc. saw significant increases when the changes went in to effect while urban areas saw decreases as the primary factors were applied to a statewide base rate.
A fundamentally fatally flawed study put forth by a person who has made many deliberate misstatements about the insurance industry before. The study does not take into account each state’s type of auto insurance or the liability limits that are unique to each state. In inflation since 1998 is running at 88.9% but auto rates are only up 43% since then despite a much higher rate of medical inflation, I’d say auto consumers are doing pretty well with the current system and don’t need California’s onerous one.
In reading the study in its entirety it has now become clear that it was simply an effort to justify the existence of the CFA and to help it get donations. It also is an attempt to justify the existence of publicly funded intervenors to protest insurer rate filings, which are completely unnecessary and drives up regulatory costs, which then get paid by policyholders. The impact of added regulatory costs on the cost to provide coverage is completely ignored in the report.
“take all good drivers who apply for insurance”
Could someone please explain the definition of good drivers for me?
I thought insurers preferred to get good drivers (in my mind, that’s people w/o moving violations). I’m just a little confused.
JW in California a good driver has no more that one point on their record in the last three years. That can be a minor cite or a no BI accident. The discount is a mandatory 20%. A DUI takes away the discount for 10 yrs.
That’s a pretty steep discount. Would they also lose the discount if the insured had additional points on their license?
Being a good driver over the short term does not necessarily translate into being a good insurable risk over the long term. I believe that is related to the intent of this rule. Essentially they are forcing a classification based on a single rating variable.
The insurer is being forced to rate that risk, but can’t they still use other factors when calculating the rate? In other words, are the insurers losing money because of this rule?
In CA, personal auto is based on driving record, years of experience, miles driven (annually), type of usage (commute/pleasure/business). Physical damage rates can be based on garaging territory, repairability, anti-theft devicies, etc.
Prop 103 set out a specific set of criteria and the order in which rates were to be promulgated. What they didn’t say…. is areas where rates in CA were very low, rural areas, small towns, etc. saw significant increases when the changes went in to effect while urban areas saw decreases as the primary factors were applied to a statewide base rate.
A fundamentally fatally flawed study put forth by a person who has made many deliberate misstatements about the insurance industry before. The study does not take into account each state’s type of auto insurance or the liability limits that are unique to each state. In inflation since 1998 is running at 88.9% but auto rates are only up 43% since then despite a much higher rate of medical inflation, I’d say auto consumers are doing pretty well with the current system and don’t need California’s onerous one.
In reading the study in its entirety it has now become clear that it was simply an effort to justify the existence of the CFA and to help it get donations. It also is an attempt to justify the existence of publicly funded intervenors to protest insurer rate filings, which are completely unnecessary and drives up regulatory costs, which then get paid by policyholders. The impact of added regulatory costs on the cost to provide coverage is completely ignored in the report.
The intervenors part of this tale really bothers me. It really sounds like a cash cow.