Auto Insurance
Pages (29) : « First ... « 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 [19] 20 21 22 23 24 25 26 27 28 29 » ... Last »VANDERBILT LOYAL TO A.A.A. INTERESTS; Informs President Hotchkiss That He Will Not Withdraw as Director. FACTS ON NEW AUTO BILL Important Changes Predicted at Automobile Club’s Annual Meeting Next Month – New License Fees. Novel Test in Rebuilding Cars. Reduced Auto Insurance by A.C.A.
It was learned yesterday from several members of the Automobile Club of America that the recent action taken by the Governors in forwarding the resignation of the club from the New York State Automobile Association, which carried with it withdrawal from the American Automobile Association, is not regarded with favor by a number of the members.
Source : query.nytimes.com
Auto Insurance Rates Declined Last Year
Auto insurance rates declined by 2.8 percent nationwide last year, the first drop in 25 years, and could fall further in 1999, an industry group said this week. The Insurance Information Institute said that the rate decline reflected competition among insurers, more skilled drivers on the road, safer vehicles and less tolerance for drunken driving.
The institute, based in New York, said it expected a further drop of 4.5 percent this year, adding that ‘’motorists with good driving records may see even bigger savings.'’
Despite the decline in rates, premiums rose slightly in 1998, the institute said. Robert P. Hartwig, its chief economist, said the average amount spent on auto insurance increased five-tenths of 1 percent last year, largely because of higher vehicle prices and their premiums. ‘’New cars are more expensive than old ones and so is the insurance,'’ he said. He added that a larger proportion of new vehicles being sold were expensive sports utility vehicles.
The institute predicted that buyers, on average, would spend $702 in auto insurance this year, down from $709 in 1998 and $706 in 1997.
Source : query.nytimes.com
THE 1997 ELECTIONS; Whitman and McGreevey Disagree Over the High Cost of Car Insurance
Following are excerpts from last night’s second debate between Gov. Christine Todd Whitman, her Democratic opponent, State Senator James E. McGreevey, and Murray Sabrin, the Libertarian candidate.
On Auto Insurance
McGREEVEY – This Governor is on the side of the auto insurance companies, as opposed to us, the motoring public. I set forth a very clear plan, a plan that devised a 10 percent rollback, but most importantly the need to prosecute fraud and not pay for it. One hundred sixty dollars out of every $1,000 we spend on auto insurance today is just that: fraud. We need to prosecute that fraud, and a public advocate, we need to have someone represent our interests. Now when there are rate increases, there are two people in the room: the insurance companies and the Department of Insurance. And we lose. Under Republican and Democratic governors, we’ve had a public advocate. We need someone on our side. My solution is to be on the side of the driver. The Governor’s plan practically asks us to give up 25 percent of our coverage. That’s the wrong approach. The Governor’s approach should be to ask the insurance companies to level out their profits.
WHITMAN – First of all, let me say that the only fraud in auto insurance right now is within the Senator’s proposal, because he knows a 10 percent rollback simply can’t happen. If it were that easy I would have done it, Tom Keane would have done it, Jim Florio would have done it and Brendan Byrne would have done it. And to say the public advocate is going to make a difference is just layering on big government. We had a public advocate and our auto insurance rates were the highest in the nation. The public advocate didn’t help. What we need is a plan that I have before the legislature now that would enable voters, drivers, to drop their rates 25 percent.
SABRIN – My plan for auto insurance is very simple: freedom. More freedom. Everyone in this room knows that deregulation works in industry after industry after industry. Long-distance telephone service is down 50, 60, 70 percent because of deregulation. What we need is to get government out of micromanagement. You know it if you’re in the business world, the government cannot manage your business, it can never manage your business, and under my administration rates will come down for consumers as we open and free up the markets.
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Mayor Seizes Car Insurance As Hot Issue
Mayor Rudolph W. Giuliani has taken a sudden interest in recent weeks in the policies of automobile insurance companies, a subject not normally within the purview of the city’s chief executive. But the Mayor’s focus on the companies may have less to do with his interest in the intricacies of their practices and more to do with his effort to keep the spotlight on what he considers perhaps the finest accomplishment of his tenure: lower crime rates.
He has railed against insurance companies at a variety of public appearances, contending that the companies have treated New York City residents unfairly because insurance rates have not kept pace with the 51 percent decline in car thefts that the city had between 1990 and 1995.
‘’It is time to ask why New Yorkers have not benefited from declining auto theft rates,'’ Mr. Giuliani said.
Because the industry is under state regulation, the answer to that question typically would be grappled with in Albany, not City Hall. In making his attacks, Mr. Giuliani has indicated that he is trying to translate his crime-fighting gains into dollars-and-cents rewards for residents. After tackling car insurance rates, he said, he will go after homeowner insurance rates, because home burglaries have also fallen in recent years.
While the Mayor says that this is not a politically motivated tactic, its political benefits are inescapable. By criticizing the companies and even announcing the creation of an investigative task force that he vowed would hold hearings to get to the bottom of the auto insurance rate conundrum, the Mayor has assured that the issue will stay fresh for weeks to come, perhaps even into next year, when he must win another election to keep his seat.
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Berkshire Hathaway Faces A Tough Insurance Market
The insurance businesses at the core of Warren E. Buffett’s financial empire suffered heavy losses last year, reflecting tough competition in auto insurance and the difficulty of making money in reinsurance – the business of insuring other insurance companies.
But Mr. Buffett said in the annual report of his company, Berkshire Hathaway, released this weekend, that earnings from the investment of premiums exceeded insurance losses of $1.02 billion by at least $934 million, contributing to the company’s overall earnings of $3.3 billion.
The earnings that derive from investing insurance premiums before claims must be paid – which Mr. Buffett refers to as ‘’the float'’ – are a key part of his strategy for Berkshire. In the report he said that while he has taken on several reinsurance contracts that are likely to lead to higher insurance losses in the next few years, the contracts will generate large premiums and likely deliver handsome investment profits.
Mr. Buffett’s reinsurance businesses lost more than $1 billion before taxes on their insurance transactions for the second year in a row, largely because of inadequate pricing and losses on coverages of medical malpractice, business liability and natural disasters. But Mr. Buffett said he was confident that the reinsurance businesses would be able to obtain rate increases this year that would improve results.
The picture was more complicated for Berkshire’s auto insurance company, Geico, which hit a wall last year after several years of rapid growth had made it the country’s sixth largest auto insurer. New sales fell 11 percent to less than 1.5 million policies, despite heavy spending on advertising. Geico said its pretax insurance losses were $224 million compared with a gain of $24 million for the previous year.
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SOAPBOX; Insurance Relief, Under Your Nose
ALL eyes are on the state Assembly in the expectation that it will pull a legislative rabbit out of its hat and give New Jersey drivers a reduction of at least 10 percent in their annual auto insurance premiums – infamously the highest in the nation – without reducing the level of coverage.
While it is probably unwise for us to hold our breath on that one, drivers here should take note of two little-known ways to reduce their premiums, without affecting coverage, that are already in place and just waiting for us to take advantage of them.
One is purchasing auto insurance as a group through an employer. This enables insurers to reduce premiums by 5 to 15 percent, sometimes more, because of the administrative efficiencies of serving a group rather than individual drivers one at a time. Premium payments are usually deducted automatically from an employee’s paycheck. Coverage can also be tailored for groups like trade organizations, professional societies or unions.
Group coverage has produced real savings in other states. Since the early 1990’s, the number of group auto plans in Massachusetts, for example, has gone from about 100 to more than 2,000, says Jason Adkins, a consumer advocate and founder of the Center for Insurance Research. Drivers with group coverage save an average of 15 percent, he says, but the discount can be as high as 40 percent.
The group auto insurance option, around for years in New Jersey under the name of mass marketing plans, seems tailor-made for a state with a large number of corporations whose employees commute by car and would be likely to regard the savings of a group auto plan as an important job perk. The program places no cost burden on employers because it is administered by the insurer. But the concept has never caught on. Why?
One reason may be that it is not an option you are likely to hear about from your insurance agent. Group plans bypass agents. Group insurers deal directly with the employer and avoid agent commissions, which is, in part, why they can pass savings along to drivers. Currently, 10 carriers offer group policies in New Jersey.
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RESTRICT AUTO INSURANCE.; Eastern Underwriters Will No Longer Cover Theft of Parts.
The eastern Automobile Underwriters’ Conference adopted a new policy clause yesterday, providing that after Oct. 1 neither new policies nor renewed policies will be issued in New York City, Philadelphia, Jersey City, Hoboken and Newark, covering the loss of parts separate from the car itself, or the so-called removable parts.
Source : query.nytimes.com
The Auto Insurance Albatross
Readers were asked what they would change to lower automobile insurance rates. Some offered reforms; others said they would not change a thing.
Let Me Out, Now
I would eliminate mandatory insurance in exchange for $150. I would then reinstitute fault. Accept that the current system is controlled by a select greedy few.
Fraud rules the current system. The system should be voluntary.
P. JOHNSTON
Jersey City
Peace of Mind
I wouldn’t be willing to give anything up for lower rates. Granted I wouldn’t mind having lower rates. But right now, high rates and all, I have the peace of mind knowing that, should an accident occur, I will not only be fully covered should I cause the accident but I also will be able to try to get back what was lost (minus loss of life) if someone else causes the accident.
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The Auto Insurance Fiasco
Post-mortems on the recent Legislative session at Albany should not be closed without comment on the shameful refusal of the State Senate to remedy shortcomings in compulsory liability insurance of automobiles
Source : select.nytimes.com
Determining the Cost of Auto Insurance
In the June 10 article ‘’Changes Readied for Auto Insurance,'’ the new auto insurance laws were said to create ‘’objective criteria that will define a good driver'’ and thus help determine fair premiums. The plan calls for 75 percent of the drivers falling into a ‘’standard'’ (good driver) category, 15 percent into a ‘’nonstandard'’ category and 10 percent into an ‘’assigned risk'’ class.
In the June 10 article ‘’Changes Readied for Auto Insurance,'’ the new auto insurance laws were said to create ‘’objective criteria that will define a good driver'’ and thus help determine fair premiums. The plan calls for 75 percent of the drivers falling into a ‘’standard'’ (good driver) category, 15 percent into a ‘’nonstandard'’ category and 10 percent into an ‘’assigned risk'’ class.
In analyzing these regulations, the question arises: How did lawmakers arrive at these percentages?
With any product or service - be it houses, groceries, dry cleaning or medical services - the prices vary depending on many things, including where we live and how much it costs to deliver to the consumer. These variables change every year and cannot be arbitrarily predetermined.
The cost of auto insurance is no different. Insurance companies estimate prices based on a variety of factors that help them determine what it will cost to deliver the service of insurance based on the customer’s level of risk.
The new auto insurance plan will allow insurance companies to use only safety records, driving experience, miles driven and type of car when setting rates. While that might sound fair, it ignores the basic cost differences of providing insurance in different areas, and it will really cause rates to go up for many low-risk drivers, especially in rural areas.
More : query.nytimes.com