.................

[kadaten]

There are a number of factors involved in determining auto insurance premiums, including where you live, the cars you drive, your driving record, how you use the car(s), who drives the car(s), etc. Auto insurance is a rather competitive market and it pays to shop around for the best deal. It also pays to ask about discounts for having multiple cars covered under 1 policy, safe driver discounts, safety equipment discounts (anti-lock brakes, multiple airbags, anti-theft devices, etc.). Rates can vary greatly between companies for the exact same coverage. A final way to reduce your premiums somewhat is to increase your deductible, especially if you are a safe driver.

Done. That premium includes discounts for safe drivers, multiple cars, anti-lock brakes, passive restraint systems, airbags, and anti-theft devices. Also low mileage discount on my van as I don't use it to commute (SAHM) and low vehicle injury rating discount. Living in Hillsborough county kills us, even though we're 20-25 miles from Tampa proper. Includes deductibles of $500 per car per incident. (Admittedly, this could be higher, but since our homeowner's deductible is extremely high due to being in a hurricane prone area, we only want to gamble with one of them. )

We won't shop around for insurers, though. We've had great experience with ours (USAA) and as long-time policyholders, they promise to ALWAYS write us policies no matter where we live, as long as we are continuously insured with them. With us frequently getting stationed in FL and other disaster-prone areas (VA was upgraded to high hurricane risk while we were there) we won't take the chance of being denied coverage. The few claims we've had in 10 years (2 auto, 1 home/hurricane) were handled professionally and expeditiously, which is more than many will say for their company. I'll be staying put.

 

[MizBlu]

We actually got a check from our auto insurance company earlier this year. I I can't recall the eaxct working of the letter, but they had a "good year" and were rewarding their "best customers" with a rebate.

At any rate, insurance companies make money in two ways. One is premiums, and the other is investment income. They invest premiums into a variety of markets, and then use that income to fund reserves. That's where catastrophic claims payments come from. Theoretically, the reserves should equal policy's written, but it doesn't always work that way.

If you want to systematically make money from an insurance company, become a stockholder with that company. A few have had some great results this quarter, even with cat losses.

Anne

No insurance company investments for me. I'm a utilities person.

And if the insurance companies are having great years in spite of cat losses, doesn't it beg the question of why are the rates being increased and why are insurance companies threatening to leave Florida?

 

[ducklite]

So in comes the last 2 years in Florida and suddenly the insurance companies are running around crying poverty and "oh my God, we have to pay claims". My point is, isn't that the business of insurance companies? Don't the good years and the bad years even out at some point?

You are wrong. Lots of companies aren't whining about losses in FL. In fact the one whining the most is Citizen's, who IMHO shouldn't exist anyhow. For the right price, anyone can get insurance on anything. (Chubb insured the DIRT on a race track in Puerto Rico at one point, and AIG carried "Millenium Risk" on Computer Associates.) People just don't want to pay the market rate premiums associated with insuring homes in high risk areas, and thus turn to Citizen's, which in turn charges rates that are too low to adequately fund reserves, so in turn find the need to try to pass their losses off to everyone in teh state, even those who are not their insured.

Anne

 

[ducklite]

No insurance company investments for me. I'm a utilities person.

And if the insurance companies are having great years in spite of cat losses, doesn't it beg the question of why are the rates being increased and why are insurance companies threatening to leave Florida?

Not all companies are increasing rates or leaving the state. Those with prudent underwriting practices and rating have no problem keeping a prescence here. Insurance is a "you get what you pay for" industry.

Anne

 

[bicker]

My observation has to do with the fact that it seems to come as a shock to the insurance companies when they have to deliver the service, in the form of paying claims, to people who've been paying for that service.

I disagree. The insurance companies I've worked with have often gladly paid claims. From my research as an investor, I know that insurance companies pay thousands of claims each day, without incident.

This really shows the problem that stems from the sensationalistic "journalism" we're subject to, these days, where people figure that one or two news stories about some person claiming that they're being treated unfairly not only means that they actually are being treated unfairly (it doesn't) but that being treated unfairly is actually common (it isn't).

 

[Tigger_Magic]

So in comes the last 2 years in Florida and suddenly the insurance companies are running around crying poverty and "oh my God, we have to pay claims". My point is, isn't that the business of insurance companies? Don't the good years and the bad years even out at some point?

For decades insurance companies went through underwriting cycles -- there were "good" years when they made money and "bad" years when profits were marginal or in some cases nonexistent. These cycles were, to a degree, fairly easy to predict. Companies invested money during the "good" years to carry them through the "bad" ones.

In the late 80's and through the 90's, the underwriting cycle didn't follow the predictable pattern insurance companies came to know and love. Some companies began suffering serious losses, both from paying claims, but also from investments that weren't performing as anticipated.

Since the late 90's, property & casualty insurers have been paying out more and more claims in less income (both from premiums and investments). Many homeowners have policies with guaranteed replacement cost coverage, which can inflate the cost of the actual loss.

Insurance companies like to whine -- it's almost genetic . Like any company, they hate to lose money and over the past few years, given all the losses from fires, tornados, hurricanes, etc., plus the fact that investments don't perform like they did in the boom years, some companies have taken a real beating.

 

[MizBlu]

I disagree. The insurance companies I've worked with have often gladly paid claims. From my research as an investor, I know that insurance companies pay thousands of claims each day, without incident.

This really shows the problem that stems from the sensationalistic "journalism" we're subject to, these days, where people figure that one or two news stories about some person claiming that they're being treated unfairly not only means that they actually are being treated unfairly (it doesn't) but that being treated unfairly is actually common (it isn't).

Whoa, stop right there, pilgrim. If you think it's uncommon for folks to be treated unfairly by insurance companies, I suggest you leave MA and take a little trip to "Charley country", Florida. It'll be an eyeopener.

 

[skiwee1]

We live in MD and our homeowners went up around $50. Same with my mother who has a different company. We both got letters stating it was being raised because of all the hurricanes that had to be paid out on. They raised ours 2 months ago.

 

[skiwee1]

Whoa, stop right there, pilgrim. If you think it's uncommon for folks to be treated unfairly by insurance companies, I suggest you leave MA and take a little trip to "Charley country", Florida. It'll be an eyeopener.

ITA. In MD we had a tropical storm two years ago called Isabelle. There are still folks living in trailers because the insurance companies don't want to pay what needs to be done to get those folks back in their homes. Our governor is looking to pass a bill that will force insurance agencies to pay up. I have yet to hear of an insurance company that happily pays a claim!

 

[MizBlu]

For decades insurance companies went through underwriting cycles -- there were "good" years when they made money and "bad" years when profits were marginal or in some cases nonexistent. These cycles were, to a degree, fairly easy to predict. Companies invested money during the "good" years to carry them through the "bad" ones.

Saving for a rainy day, like any prudent individual.

In the late 80's and through the 90's, the underwriting cycle didn't follow the predictable pattern insurance companies came to know and love. Some companies began suffering serious losses, both from paying claims, but also from investments that weren't performing as anticipated.

In other words, risky or just plain old bad investments. So how comes there's no outcry here about taking taking folk's premium money and unwisely investing it? How come the "accountability and responsibility" afficianados aren't up in arms over the bad investments?

Let me venture a guess: it doesn't fit the political agenda or philosophy. Just my opinion.

Since the late 90's, property & casualty insurers have been paying out more and more claims in less income (both from premiums and investments). Many homeowners have policies with guaranteed replacement cost coverage, which can inflate the cost of the actual loss.

Back to the bad investments: in other words, an insurance company takes someone's premium money, invests it unwisely, and then blames the one who paid them the premium for not giving them enough money.

This is starting to sound like the classic definition of chutzpah which is killing your parents and then throwing yourself on the mercy of the court because you're an orphan.

Insurance companies like to whine -- it's almost genetic . Like any company, they hate to lose money and over the past few years, given all the losses from fires, tornados, hurricanes, etc., plus the fact that investments don't perform like they did in the boom years, some companies have taken a real beating.

If they can't bear the thought of paying claims, maybe the insurance people should consider a change of career. Just a thought.

Some premium payers have taken a real hit also.

My sister took her insurance company to court. She won and was awarded $135,000 over what the insurance had tried to peddle as a settlement.

My neighbor has his insurance company in court because he's had to fork over $40,000 of his own money just to make his house livable.

My guess is the problem with the insurance companies isn't paying claims for disasters, but the gradual loosening of standards regarding reserves and investments for insurance companies by politicians in the backpocket of the insurance companies.

 

[MizBlu]

ITA. In MD we had a tropical storm two years ago called Isabelle. There are still folks living in trailers because the insurance companies don't want to pay what needs to be done to get those folks back in their homes. Our governor is looking to pass a bill that will force insurance agencies to pay up. I have yet to hear of an insurance company that happily pays a claim!

Honestly, I can say we had no problem with Tower Hill.

Allstate, State Farm, and Nationwide were a disgrace.

 

[ducklite]

Whoa, stop right there, pilgrim. If you think it's uncommon for folks to be treated unfairly by insurance companies, I suggest you leave MA and take a little trip to "Charley country", Florida. It'll be an eyeopener.

Again, you get what you pay for. If you don't want to pay market rates and go with Citizen's, then too bad, you didn't pay enough to fund reserves to begin with. If you have State Farm or Allstate or any number of other "mass market" insurance companies, again, you get what you pay for. And if you have AIG--I pity you, because everyone knows they are a PITA when it comes to paying claims HAHAHAHAHA!!!

If you have Chubb, you had a check three days later. Same thing with Fireman's Fund. You'll pay higher premiums to be with these companies, but if you have a loss you'll be glad you are.

I have Tower Hill, and haven't had a claim with them, but have heard from several people on these boards who have that their claim was handled uickly and to their satisfaction. Of course you pay more for Tower Hill than you would for State Farm.

You can't get champagne when you want to pay for beer.

Anne

 

[skiwee1]

I've never heard of Towerhill. Is that a local Florida company? We have mostly Allstate, State Farm, and a few other major insurance companies. We have never had any claims but those that had the tropical storm damage had a lot of problems. Personally I don't think it is fair that the rest of the US has to pay by higher insurance premiums for damages they did not incur. My mom and I both have clean claim records yet have to pay more because of the damage suffered in Florida. I have a major insurance company but my mom has a smaller one that is much more expensive to begin with.

 

[Tigger_Magic]

In other words, risky or just plain old bad investments. So how comes there's no outcry here about taking taking folk's premium money and unwisely investing it? How come the "accountability and responsibility" afficianados aren't up in arms over the bad investments?

Hope you don't injure yourself too badly leaping to these conclusions. Maybe you know something about each companies' investments that you'd care to share with the rest of us? There may be no outcry because there's no fire, just the smoke screen you are attempting to invent?

Back to the bad investments: in other words, an insurance company takes someone's premium money, invests it unwisely, and then blames the one who paid them the premium for not giving them enough money.

This is starting to sound like the classic definition of chutzpah which is killing your parents and then throwing yourself on the mercy of the court because you're an orphan.

You should be careful with your axe-grinding -- keep it up and you're going to grind the entire axe away.

If they can't bear the thought of paying claims, maybe the insurance people should consider a change of career. Just a thought.

Got humor (as in "sense of")?

Some premium payers have taken a real hit also.

My sister took her insurance company to court. She won and was awarded $135,000 over what the insurance had tried to peddle as a settlement.

My neighbor has his insurance company in court because he's had to fork over $40,000 of his own money just to make his house livable.

Ah, litigation... lawyers have hungry families to feed and clothe, too.

My guess is the problem with the insurance companies isn't paying claims for disasters, but the gradual loosening of standards regarding reserves and investments for insurance companies by politicians in the backpocket of the insurance companies.

Yes, the insurance industry is definitely not regulated enough.

 

[ducklite]

I have yet to hear of an insurance company that happily pays a claim!

Check out Chubb, Allianz (Fireman's Fund) and Amica. Non-quibble, fast payment of claims. Chubb was the first company to come out and state publicly that they would not invoke "act of war" clauses in their policies and would pay claims related to September 11th. They made the announcement that they would pay claims less than eight hours after the occurence. That says a lot about the integrity of that company. Alianz made a similar statement shortly later, although as their corporate headquarters are in Germany, it was dated the next day.

Anne

 

[MizBlu]

Again, you get what you pay for. If you don't want to pay market rates and go with Citizen's, then too bad, you didn't pay enough to fund reserves to begin with. If you have State Farm or Allstate or any number of other "mass market" insurance companies, again, you get what you pay for. And if you have AIG--I pity you, because everyone knows they are a PITA when it comes to paying claims HAHAHAHAHA!!!

If you have Chubb, you had a check three days later. Same thing with Fireman's Fund. You'll pay higher premiums to be with these companies, but if you have a loss you'll be glad you are.

I have Tower Hill, and haven't had a claim with them, but have heard from several people on these boards who have that their claim was handled uickly and to their satisfaction. Of course you pay more for Tower Hill than you would for State Farm.

You can't get champagne when you want to pay for beer.

Anne

You're really sure you know exactly what someone paid for?

While your crystal ball is working, could you please tell me the winning numbers for tonight's Fantasy 5?

So the discussion is now moving in the direction of "you may've paid your premium, but you dumb ***, you paid it to the wrong one".

As Rodney Dangerfield said: Tough crowd.

And the fact is, whether you had Allstate, State Farm, Nationwide or any other insurance company, you paid your premium for a service. And that's the issue, not who you paid it to.

And just as a side discussion, can someone please answer why people are so willing to make excuses for bad service from the insurance companies and bad service from their government, but can't wait to place the blame on the poor ******* who did everything right and got screwed?

I used to see this all the time in the aerospace industry. People would bend over backwards to placate an incompetent, less-than-honest supplier, but would then turn around and curse the customer upside-down for demanding a decent product.

What's wrong with this picture.

 

[MizBlu]

I have Tower Hill, and haven't had a claim with them, but have heard from several people on these boards who have that their claim was handled uickly and to their satisfaction. Of course you pay more for Tower Hill than you would for State Farm.

You can't get champagne when you want to pay for beer.

Anne

Actually, in the case of Tower Hill, you did get champagne at a beer price. When we went with Tower Hill in 2000, their rates were lower than the mass marketers and still are in this area.

Be careful of the logical fallacy.

 

[ducklite]

In other words, risky or just plain old bad investments. So how comes there's no outcry here about taking taking folk's premium money and unwisely investing it? How come the "accountability and responsibility" afficianados aren't up in arms over the bad investments?

Chubb just reported third quarter net income of $246 Million, and a good chunk of that was investment income rather than written premium.

Anne

 

[MizBlu]

Hope you don't injure yourself too badly leaping to these conclusions. Maybe you know something about each companies' investments that you'd care to share with the rest of us? There may be no outcry because there's no fire, just the smoke screen you are attempting to invent? You should be careful with your axe-grinding -- keep it up and you're going to grind the entire axe away. Got humor (as in "sense of")? Ah, litigation... lawyers have hungry families to feed and clothe, too. Yes, the insurance industry is definitely not regulated enough.

Let me know when you want some new smilies. I have some non-mass-market varieties.

And lest I forget..........

 

[MizBlu]

Chubb just reported third quarter net income of $246 Million, and a good chunk of that was investment income rather than written premium.

Anne

Take it up with TM. He's the one who brought in the "bad investment" angle.