Archive for the ‘Auto Insurance Rates’ Category

Will Ride-Sharing Companies Drive up Auto Insurance Rates for Everybody?

Monday, April 21st, 2014

Transportation network companies, also known as TNCs or ride-sharing companies, are popping up in more cities across the U.S. With names like Uber, Lyft, and Sidecar, these entities allow a person to set up and pay for a ride using a smartphone app or computer. But TNCs don’t maintain their own fleets of cars; instead, they allow regular drivers to “rent” out their personal vehicles to those who want to earn more as ride-sharing drivers.

It’s this latter aspect which is drawing the ire of some people in the insurance business. They claim that ride-sharing services are effectively driving up the rates of personal auto insurance policies for all other drivers in the areas in which they operate.

 

Auto Insurance Rates

 

Claim: Everyone Pays More Because of Ride-Sharing Drivers

Last month, the Association of California Insurance Companies issued a statement concerning what it claims will be an increase in auto policy premiums due to TNCs. The ACIC alleges that the method by which ride-sharing companies insure their drivers has a negative effect on the entire pool of drivers in its region. ACIC vice president Armand Feliciano said, “The TNC model shifts the risk and cost to their drivers and all other California drivers by putting the risk on all personal auto insurance policies. The TNCs are trying to force a square peg into a round hole, and it does not fit because TNC drivers present a higher risk than personal drivers.”

This announcement comes less than three months after a high-profile accident involving a TNC driver. On New Year’s Eve, a driver for Uber X was between rides in San Francisco when he struck a family in a crosswalk and killed a young girl. At the time, there was a question as to whether the Uber X driver was insured by the TNC, since he was not carrying a passenger at the time of the accident.  This is important, because almost no personal lines carriers will cover vehicles when they are used for hire.

But are the claims made by ACIC accurate?

Are Ride-Sharing Drivers Really More Dangerous?

 

Auto Insurance Rates

 

There is some truth to the idea of spreading the TNC drivers’ risk among the general population. That’s how most auto insurers determine how much to charge a given driver for a policy. These insurers assess the overall risk of drivers in certain geographic areas, age groups, levels of driving experience, etc. and charge a premium based on how likely these drivers are to file an insurance claim. So it would follow that if TNC drivers were a higher risk classification, then some of that risk would filter over into all of the drivers in the same geographic area.

However, there’s no evidence to indicate that ride-sharing drivers are any less or more dangerous than any other driver. While there have been some anecdotes in the media about collisions involving TNC drivers, no research has been conducted specifically to determine how safe or unsafe ride-sharing drivers are. In fact, an argument could be made that these TNC drivers are actually less of a risk than the typical driver simply because they spend more time behind the wheel in different parts of a city (and practice makes perfect). This is one reason why truckers tend to be safer drivers than those of passenger vehicles.

 

Auto Insurance Rates

 

You Can Lower Your Auto Insurance Rates

The bottom line? It’s too early to tell whether the ACIC claims are true. But if you are a driver who is concerned about your auto insurance premiums going up due to ride-sharing companies or any other reason, you should consider shopping around for a lower rate. Auto Insurance Specialists have been saving drivers money on their premiums for over four decades. So if you think you’re paying too much for your coverage, visit the AIS website today to get multiple quotes on other auto insurance policies.

Written by Chris Martin

The information in this article was obtained from various sources. This content is offered for educational purposes only and does not represent contractual agreements, nor is it intended to replace manuals or instructions provided by the manufacturer or the advice of a qualified professional. The definitions, terms and coverage in a given policy may be different than those suggested here and such policy will be governed by the language contained therein. No warranty or appropriateness for a specific purpose is expressed or implied.

Why Are L.A. Insurance Rates the Highest in the State?

Monday, November 4th, 2013
city of los angeles sign

Auto Insurance: Higher in L.A.

According to the LA Times, a recent study has proven what Californians already knew to be true: that auto insurance costs more in both the city and county of Los Angeles. Exactly how much more costly is it?

The study revealed that people who live in Los Angeles county pay premiums that are 18% higher than the state average. For people who reside within the city limits of Los Angeles, that rate jumps to 32% higher than the California average.

Does Your LA ZIP Code Matter for Auto Insurance?

Actually, it does. The amount of money you pay for auto coverage can differ widely even within the city or county of Los Angeles. Here’s an example: drivers who live in West Hollywood (with a ZIP code of 90038) tend to pay a whopping 51% more than the state average for auto insurance. And premiums are 47% higher for residents of downtown LA (90015) and Pico Heights (90006). Conversely, drivers with a ZIP code of 90045 in the Westchester area pay just seven percent more than the state’s average.

Some consumers might wonder why this is the case given that voters passed Proposition 103 back in the 1990s. This legislation minimized the impact of ZIP codes when setting auto insurance rates. But here’s the rub: people in certain parts of the LA area tend to drive vehicles that are more expensive than their neighbors in the county or city, and vehicle type is among the permitted determinants of auto insurance rates, largely based on estimated cost to repair said vehicles.

In other words, your ZIP code is still related to how much you pay for auto insurance. And because Los Angeles is so densely populated, there are more drivers on the roads there than anywhere else in the Golden State — which tends to mean more collisions and auto insurance claims.

How to Cut Auto Insurance Costs in LA

So if you don’t want to move away from LA, how can you keep those auto insurance premiums from devouring your household budget? Here are a few suggestions:

• Invest in an anti-theft device. In addition to the added security against auto theft, these devices will likely get you a break on your auto insurance premiums.

• Drive less. Fewer miles driven per year will typically translate into a lower auto insurance premium. So look into carpooling to work or school, or use your bike or public transportation when possible.

• Drive safely. It’s one of the major factors in how companies determine your rates. An absence of collisions or tickets on your record will help keep your auto insurance premiums low.

• Look for discounts. From multi-line policies to driver’s education courses to trade group membership, insurers will often offer discounts on auto insurance for a long list of reasons. Find out which ones you qualify for.

map of los angelesAuto Insurance Specialists can help Californians like you in your battle against high auto insurance rates. By providing you with quotes from multiple insurers, AIS makes the insurance companies compete for your business and helps keep costs low for you.

This content is offered for educational purposes only and does not represent contractual agreements. The definitions, terms and coverage’s in a given policy may be different than those suggested here and such policy will be governed by the language contained therein. No warranty or appropriateness for a specific purpose is expressed or implied.

Who Can We Blame for High Car Insurance Rates?

Friday, November 1st, 2013

Why does everything cost more than it used to?

image of cash moneyThis is the question that is frequently asked by Americans; but usually, the answer is pretty complicated. Certainly, it would be easier (and more satisfying) for us to be able to point to one single factor as the cause for higher prices.

The reality is that high costs are usually the result of many different factors, causes, and components. The same phenomenon is true when it comes to auto insurance rates.

finger pointingSo instead of blurting out a quick retort to the question as to why auto insurance is so expensive, let’s examine the elements which tend to boost premiums and how much impact they may actually have on rates.

Factor: Auto insurance providers

Believe it or not, the profit margin for insurers is much lower than many other industries (like oil and gas, medical equipment, Internet services, and communications equipment). Also remember that insurance markets are highly regulated by individual states, namely the respective Department of Insurance, which add significant cost to insurance companies.

Factor: Auto manufacturers

It’s true that automakers have made their cars safer with a large number of safety features and equipment. However, the computerized and technological nature of modern vehicles makes them more costly to repair both inside and out, which tends to boost auto insurance claim payouts in the event of covered losses or claims.

Factor: Inexperienced drivers

It has been said that practice makes perfect. And since teens and young adults are less experienced at driving than their more seasoned counterparts, they tend to get into more accidents, often resulting in more insurance claims.

Factor: Health care costs

Medical costs related to auto accidents can be costly. Medical costs associated with injury claims increase the overall cost of insurance and may often result in higher rates.

Factor: Uninsured motorists

If everyone had auto insurance, then those responsible for accidents would be able to pay (via their policies and up to the limits purchased) for the vehicle damage and bodily injury they may cause. But when someone without insurance causes damage to someone who does have insurance, the victimized policyholder ends up paying for it, and, over time, the costs are often passed on to every driver who has auto insurance.

Factor: People who file fraudulent claims

Some experts believe that as many as one of out every three auto insurance claims involves fraud. As a result, insurers pay out money to people who don’t need or deserve it … and the costs get passed along to the law-abiding insurance customers.

Unfortunately, you can’t do much about most of these cost-raising factors. But you can lower your individual premiums by reducing your risk of being in a collision (by driving more safely or fewer miles). You can also look for discounts on your auto insurance policy.

Auto Insurance Specialists has been helping drivers secure affordable auto insurance coverage for many years. So instead of wasting your breath playing the “blame game” with regard to high auto insurance rates, why not channel your energies into finding a lower rate for you and your family?

This content is offered for educational purposes only and does not represent contractual agreements. The definitions, terms and coverage’s in a given policy may be different than those suggested here and such policy will be governed by the language contained therein. No warranty or appropriateness for a specific purpose is expressed or implied.

5 Jobs That Can Save You Monday on Auto Insurance

Monday, October 28th, 2013

the executive washroom  and auto insurance discounts

Everyone seems to be searching for their dream job. For many, it is about more than just making a nice salary. It is about perks such as having their own office, gourmet coffee service in the break room, a pool table in the recreation area, monthly complimentary chair massages, or a key to the executive washroom.

Even if you have not yet found an employer who offers all of these goodies, there is still one perk you may be able to take advantage of wherever you are currently employed. What is the benefit in question? Cheaper auto insurance.

One of the best-kept secrets in the world of auto insurance is employer-sponsored discounts. Here are five ways in which your occupation or where you work can result in significant savings on your car insurance premiums:

5 Ways to Save On Your Auto Insurance

1. Occupation-related discounts. This category provides discounts on what your actual job duties are as opposed to who signs your paychecks. Some insurers offer lower rates to people employed as firefighters, law enforcement personnel, physicians, registered nurses, engineers, scientists, and educators. These discounts are not necessarily motivated by altruism; research has shown that people with these occupations are statistically better drivers, and therefore, they present a lower risk to insurers.

guys eating hotdogs

2. Benefits programs management companies. Many companies, both large and small, prefer to outsource their benefits management tasks, which range from health insurance and pension investment plans to wellness and retirement initiatives. Companies hire outside firms to handle all of these time-intensive programs. Many outside benefits management companies offer reduced rate auto insurance as one of the provided benefits. This is how employees at educational institutions from Harvard in New England to the University of Arizona in the western hemisphere get auto insurance rate discounts.

3. Subsidiary-related discounts. The whole idea behind reducing auto insurance rates is about sharing the risks of driving as much as possible. Therefore, the larger the pool of insured drivers, the lower the premiums may be for each individual. In this manner, corporations and conglomerates can pass on auto insurance savings to employees in every one of their subsidiary companies. For example, Berkshire-Hathaway helps workers at subsidiaries Fruit-Of-The-Loom and See’s Candies get access to discounted car insurance programs.

4. Labor unions. Speaking of strength in numbers, labor unions were organized on that very premise when it came to dealing with companies concerning compensation and working conditions. Today, many groups that are affiliated with labor unions can leverage their strong membership into discounted car insurance for their members. Union Plus, a program which traces its origins back to the AFL-CIO, offers substantial premium savings to drivers who wear the union label.

5. Public sector employees. State governments are among the largest employers in the nation, so it stands to reason that these workforces can band together to receive lower auto insurance rates. Idaho for example, offers insurance discounts not only to current state employees, but also to employee dependents and state retirees.

So tomorrow when you go to work (or now, if you are already at work), check with your human resources manager or benefits liaison about possible auto insurance discounts you may be eligible for. You can also contact Auto Insurance Specialist to see about getting a free auto insurance quote that may be lower than your employee discount!

Image credit #2 & #3: SIUE, paraflyer

This content is offered for educational purposes only and does not represent contractual agreements. The definitions, terms and coverage’s in a given policy may be different than those suggested here and such policy will be governed by the language contained therein. No warranty or appropriateness for a specific purpose is expressed or implied.

Why You Don’t Want to Lie About Your Address to Get Lower Auto Insurance Rates

Friday, October 18th, 2013

Whether or not you think this is fair, where you live has tangible effects in some industries — including auto insurance. But it’s not because of any perceived status of a policyholder. Since addresses are often used as a determinant for auto insurance rates, two drivers with identical ages, vehicles, and driving records could pay drastically different premiums if they have different ZIP codes.

Which sometimes leads to some drivers lying about his or her address on an auto insurance application in order to secure a better quote.

Lying in Detroit

This has been observed most recently in and around Detroit, Michigan. Because Detroit has high auto theft rates (and partially because Michigan’s auto insurance laws result in costlier payouts to claimants), coverage for drivers within Detroit city limits costs substantially more than for people who reside in the city’s suburbs. One analysis revealed that a middle-aged owner of a safe car who possesses a good driving record can pay around $4,500 a year for auto insurance in Detroit — but that figure drops by over 50% in many of the surrounding suburbs.

This consequence of this disparity leads many drivers who live in Detroit to set up an address — often with a post office box — which can be used solely to renew their auto insurance. So even if someone spends a few hundred dollars a year on a P.O. box, they’re still paying less than they would be if they were truthful on their auto insurance application.

Which begs the question: is this practice just a little white lie, or is it a bad idea?

What Happens if You Get Caught Lying to Your Auto Insurance Company

girls nose growing - be honest when applying for auto insuranceWhile lying about your address on an auto insurance form isn’t a crime, it can have serious consequences if you are found out (and companies have ways of finding out). Insurance companies call this “material misrepresentation of the risk,” which is more commonly referred to as fraud. And if your insurer discovers the inconsistency, it has the right to cancel your policy and/or refuse to pay a claim if you are involved in an auto accident. Furthermore, if/when you start looking elsewhere for auto coverage, the “news” of your fraud will be made available to other insurers, and you’ll likely either be denied coverage or pay higher premiums.

The Truth Will Set You Free

So the takeaway from this story is clear: don’t lie about your address on your auto insurance application to get a cheaper quote. There are plenty of other ways to legally reduce the amount you pay for coverage using discounts, policy tweaks, and other methods. For more information on these options, contact Auto Insurance Specialists. They have a long track record of finding affordable auto insurance coverage for customers, without anyone having to tell a lie!

This content is offered for educational purposes only and does not represent contractual agreements. The definitions, terms and coverage’s in a given policy may be different than those suggested here and such policy will be governed by the language contained therein. No warranty or appropriateness for a specific purpose is expressed or implied.

10 Easy Ways to Get the Best California Auto Insurance Quotes

Monday, June 3rd, 2013

Follow These 10 Tips and Find the Best California Auto Insurance Rates

Do you know someone who is paying less for auto insurance than you are? Is there no obvious reason for the price disparity? Are you suspicious of how this person obtained his or her low rate?

The reality is probably simpler and a lot less sinister: the person knew the tricks for getting a lower auto insurance quote. But there’s no reason that this important knowledge should be kept secret. Here are ten “tricks of the trade” that could save you money on auto insurance.

1. Drive fewer miles. For many insurance companies, the threshold for lower premiums is 7,500 miles per year. If you currently drive 9,000 miles annually, carpooling or taking public transportation to work once a week could drop you below the 7,500 level. So make a pledge to do this, and your quotes will likely be lower.

2. Trade cars with your spouse. In the above example, if your spouse only drives 5,000 miles per year, swapping cars two or three times per week would allow both of you to drive fewer than 7,500 miles annually. Then you could benefit from lower rates on both vehicles.

3. Opt for a higher deductible. When you get a quote from an insurer, it is often computed on the assumption that you will pay a certain deductible in the event of a claim. But you can adjust that deductible upward if you like (say, from $250 to $500 or $1,000) and pay less in premium for your policy. Just be sure you fully consider that the higher deductible means that your out of pocket expense will be higher in the event of a covered loss.

4. Offer to pay up front. Almost every business likes to get money in its bank account sooner rather than later — and insurance companies are no different. If you are willing to pay for six months or a year’s worth of insurance in advance, you’ll likely get a lower quote than for a policy with monthly payments as you’ll avoid the typical installment fees that most carriers charge due to the additional paperwork and processing costs.

5. Bundle your policies. Consider your entire insurance coverage portfolio (homeowners, flood, earthquake, boat or RV, etc.). If you can purchase your auto insurance from a company you’re already doing business with, chances are good that the insurer may be able to offer you a price break in the form of a multi-policy discount.

woman standing in kitchen getting insurance quotes online6. Take an online drivers’ course. Insurance companies offer discounts of anywhere from 2% to 10% if you just complete a driver’s education course. Since these classes are widely available online, allocating four to eight hours (which can be spread over several days) for this type of instruction is definitely worth your time.

7. Invest in a security system. If your vehicle doesn’t already have an anti-theft system or vehicle theft locator device installed in it, consider having one put in. Auto insurance companies will give you a discount for vehicles with these types of systems.

8. Mention your vehicle’s safety features. When insurance companies assess your vehicle for its safety, they may not know about any additional safety features you may have opted for when buying it (like a reverse camera, anti-theft devices, or additional airbags). Pointing out these features may lower your auto insurance quote.

9. Study hard and excel in school. Full-time high school or college attendees are often eligible for good student discounts (usually an A or B average). So if you’re hitting the books, you’ll qualify for a cheaper insurance quote.

10. Ask about lower rates. It’s so simple, yet far too many people forget to do it. Simply asking how you can pay less for auto insurance may allow an insurer to find a discount or coverage arrangement that you hadn’t considered. After all, insurance companies want your business — and they’ll try to find ways to keep it.

This content is offered for educational purposes only and does not represent contractual agreements. The definitions, terms and coverage’s in a given policy may be different than those suggested here and such policy will be governed by the language contained therein. No warranty or appropriateness for a specific purpose is expressed or implied.

Auto Insurance Discounts with AIS

Monday, July 23rd, 2012

When it comes to auto insurance, it can be difficult to find the best deal. At AIS, it’s important to us that you get the best deal on auto insurance. So whenever you buy a policy through us, we may be able to offer the discounts below, depending on eligibility:

  •  Anti-Theft Discount: If your vehicle is equipped with an approved anti-theft device, you can save up to 2% on your auto insurance premium.
  • Good Driver Discount: Drivers who have no or minimal recent history of traffic violations or insurance claims can qualify for the California Good Driver insurance discount. With it, you can save  20% on your auto insurance.
  • Good Student Discount: Full-time students who maintain a “B” average or higher get rewarded with cheaper auto insurance! With the good student discount, you may get up to 30% off certain coverages.
  • Mature Driver Discount: If you are 55 years of age or older and  complete an approved driver safety course (such as the Mature Driver Improvement Course through the California Department of Motor Vehicles), you can receive the mature driver discount. This can get you up to 5% off of your premium.
  • Multiple Car Discount: Save when you buy in bulk! If you insure two or more vehicles through AIS, you can save up to 15% on your premium.
  • Professional Group Discount: Teachers, scientists, engineers, attorneys, and medical doctors can receive 5-15% off auto insurance. To find out if you may qualify for a group discount, contact AIS.
  • Cycle Safety Discount: Even if you are not insuring a car, you can still get a discount. By passing an approved motorcycle safety course, you may receive the cycle safety discount and save up to 5% on your motorcycle insurance premium.

 On top of all those potential discounts, AIS periodically re-shops your auto insurance policy to see if we can get you better prices, coverages, or even more discounts. With AIS, you’ll always get the best prices no matter what insurance policies you’re after.

 This content is offered for educational purposes only and does not represent contractual agreements. The definitions, terms and coverages in a given policy may be different than those suggested here and such policy will be governed by the language contained therein. No warranty or appropriateness for a specific purpose is expressed or implied.

Are Hybrid Cars More Expensive to Insure?

Tuesday, June 12th, 2012

Since their inception into the mainstream market, hybrid vehicles have been growing in popularity among consumers. Their main appeal is that they help drivers save money in fuel costs. But is that just a trade-off for more expensive insurance premiums?

 The answer is yes and no. Every insurance company calculates their customer’s premium payments differently. That’s why AIS shops multiple insurance agencies to give you the best quote for auto insurance. Some things about your hybrid may make it cheaper to insure than other cars, while other factors could make it more expensive. In general, here are some factors your insurance company may think about when determining the insurance rate for your hybrid:

 Model specifications: While hybrids don’t really have a reputation for tearing up the roads, many are designed in such a way that your insurance company may classify it as a sports car.  Many hybrid models are small, light-weight, and low to the ground. Your insurance company may charge more if your hybrid has such sporty features.

 Replacement costs: Hybrid cars are advanced vehicles. Repairing any parts of the drivetrain can be much more expensive than the same repairs would be for a comparable, non-hybrid model. Since the repairs may cost more, the insurance may cost more. On the other hand, the unique build of hybrids can make them more difficult targets for thieves; the ignition system is usually different from common cars. Because of that, you might get a discount.

 Your driving record: Having a longstanding, safe-driving record may negate any potential insurance risks that are exclusive to hybrids. Always be sure to ask your AIS representative if you are eligible for safe driver, or other discounts.

 This content is offered for educational purposes only and does not represent contractual agreements. The definitions, terms and coverages in a given policy may be different than those suggested here and such policy will be governed by the language contained therein. No warranty or appropriateness for a specific purpose is expressed or implied.

More Auto Insurance Myths

Tuesday, May 22nd, 2012

We’re back, busting yet another set of auto insurance myths. All of these myths have to do with the amount of your premium. Insurance companies all have different ways of calculating a premium, which may have lead to consumer confusion that caused the following myths.  If you want to keep things simple, request an insurance quote from AIS. We provide rates from multiple California insurance companies to make sure you get the one that’s best for you. Now, on to the myths:

 Myth: Insurance rates are higher for smokers
Truth: This myth may have come from the fact that smoking can be a factor in determining rates with other insurance types, such as health, and life insurance. Auto insurers, however, don’t examine smoking habits. 

Myth: Bad credit won’t affect auto insurance rates
Truth: Some states do not allow the use of credit history to determine auto insurance rates, and California is one of them. But laws may change, so it’s in your best interest to keep your credit in good standing. Not only can you get the best insurance rates, but you’ll be eligible for other preferred rates or types of financing outside of insurance. 

Myth: Senior citizens pay more for auto insurance
Truth: Age can be a ranking factor in determining insurance rates, and its importance can vary between insurance providers. However, being older is not always a disadvantage. Special accident prevention and driver safety courses are available for those over 55. Taking one can decrease your auto insurance premiums. Contact AIS for more information about this and other types of discounts you may be eligible for.

 This content is offered for educational purposes only and does not represent contractual agreements. The definitions, terms and coverages in a given policy may be different than those suggested here and such policy will be governed by the language contained therein. No warranty or appropriateness for a specific purpose is expressed or implied.

Common Auto Insurance Discounts

Thursday, November 3rd, 2011

Discounts are an important part of insurance. However, they can vary widely by state, policy type, and provider, thus it can be difficult to get a definite impression of which insurance discounts you may be eligible for. Luckily, there are some consistencies across the system. In terms of auto insurance, contact your AIS representative today to see if you qualify for discounts such as these.

  • Anti-theft Discount – Cars that are eligible for an anti-theft discount are models equipped with a theft recovery system, such as OnStar or LoJack. Chances are this discount (if applicable) was applied when you first purchased your car. However, if you have added any aftermarket security features to your vehicle since buying it, you may qualify to receive this discount.

 

  • Good Driver Discount – This is a relatively new discount you’ve probably been hearing about in many insurance advertisements. Like the name implies, drivers who have no recent history of traffic violations or insurance claims can receive a discount. “Recent history” varies among providers, so confirm with your AIS representative to see if you’re eligible.

 

  • Multi-car discount – This is one of the most common discounts you can obtain for auto-insurance. It’s based on the “buying in bulk” savings concept. The more policies you buy from a single provider, the less the policies will cost. If you are considering purchasing a new car, be sure to check if you qualify for a multi-car discount.

 

  • Mature Driver Discount – Do you know how younger drivers usually have to pay higher premiums for auto-insurance because of their lack of driving experience? It’s usually the opposite for older drivers. If you take a Mature Driver Improvement Course that is approved by the California Department of Motor Vehicles, you could receive an insurance discount for successfully completing the course. However, you should confirm with your AIS representative first that a discount will be applied before you enroll in the course. Please note there are similar courses available for young drivers that may garner a discount as well.

 

This content is offered for educational purposes only and does not represent contractual agreements. The definitions, terms and coverages in a given policy may be different than those suggested here and such policy will be governed by the language contained therein. No warranty or appropriateness for a specific purpose is expressed or implied.