Auto Insurance News Archive for February, 2010

• Mistake in Credit Scoring Could Lead to Higher Premium Rates

  by Jeanny Hopper
  

  A credit score is basically a statistical analysis representing a person’s credit files. Banks and credit card companies use this as a tool to determine the following: those who are qualified to take a loan; the interest rates that may be charged; and, the credit limit which may be given to an applicant. Few people know that credit scores are also being used by auto insurance companies. But these three numbers, which could also be prone to mistakes, may eventually lead to paying higher premium rates because of instances when insurers mistakenly interpret credit reports. According to Mississippi Insurance Commissioner … (more) February 11, 2010

• Numbers Reveal Continuing High Incidence of Auto Insurance Fraud in New York

  by Jeanny Hopper
  

  Amidst the introduction of a bill seeking to cut auto insurance costs and minimize fraudulent acts relating to motor insurance, new information which was released by the New York State Insurance Department would confirm that fraud cases have indeed soared these past few years. The fraud is usually a two-step scheme. As in reported cases before, the strategy employed by fraudsters involve corrupt medical clinics and “staged accidents.” After arranging for a fake mishap, dubious medical clinics would produce excessive and unnecessary treatment fees and medical expenditures. These, in turn, would be presented to insurers for indemnification. Industry insiders have … (more) February 11, 2010

• Pizza Owners Need to Check Their Auto Insurance Coverage

  by Jeanny Hopper
  

  Pizza delivery “time guarantees” used to be prevalent among pizza shops as well as other fast-food restaurants. Being used mainly as a promotion tool, pizzerias would often incorporate or promise delivery within a pre-determined period. However in 1993, this practice was stopped primarily because of different lawsuits which arose from accidents that pizza drivers figure because of the time limit for delivery. But nonetheless, customers are still attracted by how fast a pizzeria could bring their orders. Auto insurance experts estimate that there are thousands of pizza delivery drivers who ply the road on an everyday basis. On occasions such … (more) February 10, 2010

• Toyota Recall Stirs Auto Insurance Companies and Consumers

  by Jeanny Hopper
  

  The recall of an estimated 5.2 million Toyota vehicles due to floor mat problem and a pedal entrapment is causing a stir in the auto insurance industry. Add to this figure a 2.3 million recall of the same brand of vehicle because of problems on the gas pedal, and we have insurers and consumers wondering what long term impacts the incident would have on premiums and claims. According to a recent report, many insurers are currently piling-up paperwork in order to make Toyota accountable for millions of dollars which may be attributed to the company’s faulty design. In legal parlance, … (more) February 10, 2010

• Insurance Company in Hot Water Over Allegations of ‘Illegal Practices’ in California

  by Jeanny Hopper
  

  State and federal legislators are urging a closer examination of an auto insurance firm which may have involved itself in illegal practices. Mercury Insurance Group was mentioned in a California state report which suggests that the company engaged in discrimination against customers serving in the military (and individuals from other occupations) and ‘deceptive pricing.’ Steve Poizner, State Insurance Commissioner, reported that the Mercury may have ‘repeatedly violated’ Proposition 103. This proposition was passed in 1988 providing legal consumer protections. The state report said that the insurer did not grant coverage immediately to certain applicants. These application included customers serving in … (more) February 9, 2010

• Insurer State Farm Claims That They Foresaw Toyota Crisis in ‘07

  by Jeanny Hopper
  

  DETROIT – The Toyota recall problem may have been averted much earlier, according to U.S. private insurer State Farm. In last 2007, State Farm claims that they noticed ‘worrying trends’ of accidents caused by vehicles involving Toyota car models. They said that they informed a U.S. government regulator, the National Highway Traffic Safety Administration, about their observations. Company Spokesman Kip Diggs said that they saw significant activity and trends on Toyota-related insurance claims back then, which are indicators that should be taken seriously. The Insurance Information Institute reported that State Farm is the largest auto insurance provider in the country, … (more) February 9, 2010

• $702 is the Current National Median Auto Insurance Rate

  by Jeanny Hopper
  

  The median auto insurance rate, for a 6-month policy, is presently $702. This was reported by InsWeb, a premier insurance comparison provider online. The rate has dipped by about 0.5% in the last six months. The Insurance Provider has also provided statistics which break down the median rate data according to specific demographic categories. These categories include women, men, teens and senior citizens. InsWeb said that women shell out a median auto insurance rate that is 5% lower compared to men. For a six-month policy, instead of $720, women pay about $683. Drivers who are 19 years of age (and … (more) February 8, 2010

• Bill In The Works In Iowa To Protect Auto Insurance Rates From ‘Extraordinary Events’

  by Jeanny Hopper
  

  Bill in the works in Iowa to protect auto insurance rates from ‘extraordinary events’ Iowan lawmakers are discussing a bill that would come to the aid of residents who discover that their insurance rates have spiked due to ‘having a personal financial crisis’ Story City Democrat Rich Olive, who is also an insurance agent, said that many families have been adversely affected by the recession, and many falling victim to unemployment. Olive said that it is during these dire times that insurance companies and several financial institutions investigate their clients’ credit scores. Insurers are most likely to increase their rates … (more) February 8, 2010

• Voter Initiate Set To Evaluate Auto Policy Discount System In California

  by Jeanny Hopper
  

  A voter initiative in California is set to appear on the June 8, 2010. This initiative will evaluate the continuous discount in auto policies offered by providers in the state. Authorities are trying to find out if the current regulations on discount offering are still fair for both drivers and insurers. According to the California Department of Insurance, ballot aims to reward motorists who have been insured for a long period of time by making them eligible for what they call a “persistency discount”. The Department adds that for drivers can still be qualified of the said discount even if … (more) February 6, 2010

• A New York Legislation To Cut Insurance Cost

  by Jeanny Hopper
  

  Senator Charles E. Schumer on Friday announced that he is introducing the cheaper car insurance Act of 2010, legislation that would institute new federal penalties for auto insurance fraud. This bill comes on the heels as a new report revealed the increasing incidence of auto insurance fraud in New York, along with the drivers’ insurance rates. Suspected fraud cases have increased by 33% since 2006 in New York alone, leading to an average rate hikes of 6.3% in 2009. Schumer’s legislation would go after criminals who are committing the fraud, and that they should pay the bill. It would also … (more) February 6, 2010

• Virginia Speed Limits to Increase by as much as 70mph

  by Jeanny Hopper
  

  Speed limits on certain portions of rural interstate highways in Virginia will be raised to 70 miles per hour due to bills passed by both the House and Senate last February 2. Senate voted 29-11 in favor of the bill while the House voted 71-26. Virginia Gov. Bob McDonnell was part of the leading initiators in the recent bill passage since this was one of his priorities to increase the speed limits as a component in his transportation proposals from his campaign last year. The House and the Senate passed bills to raise the speed limit from 65 mph to … (more) February 5, 2010

• Auto Insurance Costs in Florida are Going Up

  by Jeanny Hopper
  

  State Farm, the biggest auto insurance provider in Florida, has reported an average auto insurance rate increase of 9.2% which includes 2.7 million clients in the state. Chris Neal, State Farm spokesman, explains that the trend of spiking rates excludes their company since they have reduced their rates for several years in a row. He admits that there has been an increase in the filing of auto claims. State Farm controls 20% of the state auto insurance market. In January, Allstate Fire and Casualty clients had to deal with a 16% rake hike. On average, their customers deal with an … (more) February 5, 2010

• Massachusetts Toyota Owners May Appeal Their Auto Insurance Surcharges

  by Jeanny Hopper
  

  The Massachusetts Division of Insurance has ruled that Toyota owners who are involved in accidents due to gas pedal problems can appeal their recent or even old auto insurance surcharges to have a re-hearing. The regulators decided late last month that drivers who are covered by the massive recall by Toyota may request to have their surcharges reversed if proof can be provided that shows that auto acceleration was the cause of the accident. Toyota decided to recall some 4.2 million vehicles with gas pedal mechanisms which are potentially dangerous. This also covers the Pontiac Vibe and several Lexus car … (more) February 4, 2010

• Mercury Insurance Funded ‘Prop 17’ May Usher Higher Surcharges in California

  by Jeanny Hopper
  

  The Mercury Insurance fully funded initiative which aims to increase auto insurance rates was assigned Proposition 17 on the ballot for the June 8 California elections, announced Debra Bowen, Secretary of State. The Campaign for Consumer Rights, campaign affiliate of Consumer Watchdog, said in a press release that the proposition would penalize drivers, including seniors and soldiers, with surcharges if they are found to have a lapse in auto insurance coverage for ‘virtually any reason’ in the last five years. The proposal will compel drivers to pay hundred of dollars more for auto coverage, especially when they stopped driving for … (more) February 4, 2010

• Cal State Low Cost Auto Insurance Sees 18.9% More Participants in ‘09

  by Jeanny Hopper
  

  Participation in the California Low Cost Automobile Insurance Program (CLCA) in 2009 increased by about 19% compared to 2008. Steve Poizner, California Insurance Commissioner, said that the 18.9% increase was due to the efforts of the commission’s outreach program as well as the dire economic situation in the country. The program, established in 1999, has been offered to every county in California since 2007. The Commissioner explained that the law requires every single driver in the state to carry automobile liability insurance. However, he admits that the dire economic situation at the current time causes citizens to cut costs. The … (more) February 3, 2010

• Fair Auto Insurance Rates Up For Grabs in June 8 California Ballot

  by Jeanny Hopper
  

  By June 8 this year, California residents will be able to vote for an auto insurance persistency discount. Consumer watchdog group Californians for Fair Auto Insurance Rates (CalFAIR) was able to gather enough clout to place a voter initiative on the June ballot. The Secretary of State certified that the initiative intends to reward drivers who possess car insurance for a certain period of time to be eligible for a persistency discount even if they switched to another insurer. The Continuous Coverage Auto Insurance Discount Act gained the financial support of Mercury Chairman George Joseph as well as other company … (more) February 3, 2010

• Things to Remember When Applying for Car Accident Insurance

  by Jeanny Hopper
  

  The moment you buy a car, first thing to think about is not getting a new set of mufflers, rims or spoilers. Think first of getting insurance because that may be the best thing you can get for your car at the moment. There is no limit to benefits you get from availing of a car accident insurance early on. You have decided to get covered by an indemnity policy; first thing to do is to look for a reputable insurance provider. Normally, a car dealer will attempt to sell you insurance, whether for a profit or not. This is … (more) February 2, 2010