Auto Insurance

Progressive Insurance Monthly Profits Remain Relatively Stable

Progressive monthly profits dipped slightly last month, dropping 1.7 percent between December 2011 and January 2012.

January profits for the insurer were $75 million, down from $76.3 million the month before.

Those are pretty good results considering the fact that losses and loss adjustment expenses for the company were up 30 percent for the period. Investment income was also down 4.7 percent.

Buoying the results were growth in premiums written and the performance of securities. Premiums grew 44 percent, going from $1.01 billion up to $1.46 billion. And securities performance went up from a $22.7 million loss in December to a $11.9 million gain in January.

The year-to-year results, however, were not as favorable.

Compared with January 2011, monthly profits were down 33.4 percent, or $37.6 million. Two of the factors contributing to that development were declining gains on securities (they fell $20 million between the first month of 2011 and January 2012) and increases in underwriting, loss and loss adjustment expenses (they grew by a total of $97 million).

Still, net premiums written grew by 6 percent ($83.3 million) between January 2011 and January 2012.

Progressive, which specializes in selling policies to consumers who compare car insurance quotes online through their website or over the phone, remains one of the largest private passenger auto insurers in America. According to the latest data released by the National Association of Insurance Commissioners, Progressive is the fourth-largest auto insurer in the country in terms of market share.

It has seen significant growth as consumers are increasingly opting to research and purchase coverage through direct channels rather than through agents.

According to the most recent financial release, Progressive had about 8.58 million personal auto policies in place in January 2012. Of those, 45.3 percent were serviced directly through the company. In January 2008, only 37.3 percent of the company’s policies were serviced directly.

To read the experiences of current and former Progressive policyholders, readers can find user-submitted Progressive auto insurance reviews online.

High Risk Car Insurance Costs

The cost of auto insurance can fluctuate for many reasons, but primarily premiums are based on risk. Automobile accidents, insurance claims and moving violations are recorded on a motorist’s driving record, which is used by insurers to calculate coverage costs. Vehicle owners who maintain clean driving records and demonstrate a small chance of filing a claim in the near future typically encounter lower rates. High-risk drivers, however, are usually charged more for vehicle coverage.

When a motorist is statistically more likely to file a claim in the future, insurers raise premiums to compensate for the possibility of economic loss. There are many different reasons why a motorist would need to purchase high risk car insurance instead of low cost coverage, but while in the non-standard market, drivers can often take advantage of several adequately priced options. Although many insurers specifically target motorists in the preferred or standard markets, higher-risk insurers or state run programs may offer affordable alternatives.

Insurance companies often rely on unique methods for rating motorists. As a result, prices can fluctuate significantly between insurers. For higher-risk drivers, this can translate into lower rates or more reasonably priced options. To efficiently shop around, motorists should compare quotes online. The Internet can produce dozens of estimates from one website, giving vehicle owners the ability to quickly search for the lowest prices available.

Options for Motorists with High Risk Auto Insurance Read more…

Buy and Maintain Proof of Auto Insurance

When a motorist is required to buy vehicle coverage to legally drive, it is also often necessary to demonstrate proof of financial responsibility as well. Verifying that an adequate amount of car insurance has been purchased requires motorists to find a licensed insurer and purchase enough coverage to meet any minimum coverage limits. If a vehicle owner cannot meet their financial responsibility requirements through alternative means, drivers are urged to shop around and only purchase coverage from a legitimate insurer.

In most states vehicle owners are given the option of meeting their financial responsibility requirements by acquiring a certificate of deposit or a liability bond. In each of these situations, a sum of money is set aside to demonstrate that the motorist in question can adequately pay for at-fault damages after an accident. Because most people are unable to set aside large sums of money, the majority of motorists purchase vehicle coverage.

With the added conveniences of modern technology, many vehicle owners can get instant proof of auto insurance by taking advantage of online resources. Insurers that offer their services over the Internet can usually provide motorists with policy verification over email, or in a downloadable Portable Document Format (PDF) that lists all of the necessary information. Alternatively, some online coverage providers may mail motorists their policy verification.

Avoid Consequences for Driving Without Proof of Auto Insurance

When a motorist buys vehicle coverage, their proof of financial responsibility should list specific details about the motorist, their automobile and the policy. For the majority of vehicle owners, adequate insurance evidence includes the names of the insured, name of the coverage provider, insurer contact number, policy number, policy effective and expiration dates, vehicle identification number and details about the insured automobile. It is important for motorists to ensure that all of the listed information is accurate and thoroughly updated. An insurer that does not provide policyholders with a certificate of insurance, or lists incomplete information may be unlicensed and/or unlawful. It is essential that motorists report any fraudulent activity, or contact local officials if the legitimacy of a company is questionable.

To help reduce the number of uninsured motorists on the road, in addition to the the amount of fraudulent activity, many states have adopted online insurance verification programs, such as TexasSure in the Lone Star State, that track and verify when vehicle owners are adequately insured. Many of these systems create a digital link between local officials, the state Department of Motor Vehicles, and coverage providers who are licensed to sell auto protection. These systems allow local officials to periodically verify that residents are adequately insured, and lawfully prosecute those who operate an automobile while uninsured.

Court: Penn. Insurer’s Fine Print Negated Coverage Rejection

The Pennsylvania Superior Court ruled on Monday that some additional language included in a form that Unitrin policyholders sign to reject underinsured motorist coverage actually invalidated the rejection form, meaning that many of Unitrin’s Pennsylvania automobile insurance policyholders could be entitled to compensation under a type of coverage they chose to reject.

All Pennsylvania car insurance policies by default include uninsured/underinsured motorist (UM/UIM) coverage, which provides coverage when the policyholder is injured in a car accident caused by an uninsured, underinsured, or hit-and-run driver.

But drivers can reject this coverage by signing a form contained in the pages of their auto policies. The language of that form is dictated by law so that this section of all Pennsylvania policies reads the same way.

Unitrin, however, added an extra 20 words to the statement policyholders sign to reject the coverage.

The extra sentence seemed innocuous enough to Unitrin and the trial court that ruled in the insurer’s favor: “By rejecting this coverage, I am also signing the waiver on P. 13 rejecting stacked limits of underinsured motorist coverage.”

The opinion of both Unitrin and the lower court was that the additional sentence was “clarifying” language that did not affect the terms of the rejection.

But a majority of state Superior Court judges who reviewed one Unitrin policyholder’s appeal said the fact that the language deviated from what had been prescribed in the state’s financial responsibility law is enough to make the Unitrin UM/UIM rejection void.

The lower court’s decision was reversed.

Decision Could Be Significant for Unitrin Policyholders Who Have Made UIM Claims

The case originated in July 2009 when Unitrin policyholder Lee Jones was injured in an accident while riding as a passenger.

After being treated for injuries, it turned out that Jones’s damages exceeded the limits of the at-fault driver’s bodily injury liability policy–a scenario in which underinsured motorist coverage would kick in and cover the remaining damages.

But Jones had signed the UIM rejection form, meaning she would likely have to pay for the remaining damages out of pocket.

After Unitrin denied her claim, the two parties went to court over whether the rejection form Jones had signed complied with state statutes and, in effect, whether she was covered under the policy. The trial court said the language did not negate the policy and sided with Unitrin in the end, but the Superior Court ruling reversed that decision.

This may not be the end of the Unitrin case. But if the Superior Court’s decision is upheld, it could mean drivers who were denied UIM benefits because they had rejected the coverage may still be able to collect for their damages.

The Cheapest Insurance Companies Available

There is no single company that can offer the cheapest car insurance for every motorist. When coverage providers rate vehicle owners, they often evaluate an assortment of details to determine the driver’s level of risk. As a result, it is common for multiple motorists to receive unique quotes from the same insurer. The least expensive company for one driver may not be the same for another vehicle owner, making it essential to shop around before buying a policy.

When a vehicle owner is rated by an insurer, they are generally placed in one of three categories: preferred, standard and nonstandard. These markets reflect a motorist’s risk of filing a claim, and can influence how much they pay for vehicle coverage. Often the cheapest auto insurance companies cater to drivers in the preferred or standard market, but there are also coverage providers that specialize in insuring higher risk drivers.

Vehicle owners should look for the least expensive insurer in their specific market to reduce coverage costs. One of the best ways to do this is to make comparisons. In individual markets there are still some insurers who offer lower rates than others. Comparing quotes can help drivers find the cheapest rates available. Instead of contacting companies directly for pricing information, motorists should evaluate estimates online where dozens of quotes can be viewed at once.

Investigate the Cheapest Car Insurance Companies

The cheapest insurers generally offer different ways for drivers to cut coverage costs through discounts and other special offers. Often these savings are geared towards attracting new customers, but policyholders can frequently reduce their rates by taking advantage of multiple discounts at once. These savings are often awarded for insuring multiple vehicles on the policy, maintaining a clean driving record for at least three years, or for driving an automobile that is equipped with additional security features. Insurers frequently offer different opportunities, and to maximize savings, motorists are encouraged to compare the discounts that various coverage providers can provide.

A quality that is commonly overlooked when searching for a cheap insurer is the financial stability of an insurer. When motorists pay for premiums the money is often invested by the coverage provider. If an insurer has poorly managed their finances, paid out numerous claims or has suffered heavy financial losses, these expenses will likely be passed on to customers in the form of higher premiums. The process of Finding a Reputable Insurance Company should include research into an insurer’s financial background. Much of this information can be found online in the form of reports provided by independent businesses devoted to ranking insurers on qualities such as creditworthiness, investment history, and overall financial strength.

Cheap Auto Insurance Rates as a Young Driver

Newly licensed teenagers between the ages of 16 and 19 have a statistically higher chance of being involved in an accident than any other age group. Unfortunately, this can also translate into higher coverage costs when it comes time to purchase auto insurance. Policy prices are largely based on the likelihood that a motorist will be involved in an accident or file a claim, and multiple studies have concluded that young and inexperienced drivers are more likely to operate a motor vehicle without a seat belt, drive while intoxicated, speed and take unnecessary risks. Insurers often charge younger drivers more for coverage to compensate for accepting these additional risks.

Although younger motorists commonly encounter higher rates, getting cheap car insurance for teenagers may still be possible after a shopping around and taking advantage of various money saving opportunities. Although the majority of coverage providers prefer to insure low risk drivers in the preferred or standard market, there are multiple companies that are more than willing to provide coverage to higher risk motorists, including teenage drivers.

Shopping around and comparing quotes can give teenagers the opportunity to find out which insurers can provide the lowest rates. Evaluating estimates online can also allow motorists to see dozens of sample rates at once, increasing a driver’s chances of finding an adequately priced policy.

Cheaper Teenage Auto Insurance Prices

The high cost of vehicle coverage for teenagers is largely accredited to accident statistics surrounding younger motorists. The Congressional Quarterly states that Teen Driving has become a serious problem in recent years, as automobile accidents prove to be the leading cause of death for American teens. Studies have shown that roughly 10 teenage drivers were killed every day as the result of automobile accidents in 2003. While upholding these statistics by accumulating multiple moving violations or being involved in accidents is likely to increase a motorist’s rates, demonstrating responsibility behind the wheel can quickly lead to lower prices.

Maintaining a clean driving record and an exceptional grade point average while in school can often lead to discounts and lower rates for teenage drivers. While shopping for quotes, it is important to research the various discounts that may be available. These savings can often result in noticeably cheaper prices and a strong incentive to maintain a clean driving record.

Oftentimes insurers will reduce rates for a number of reasons. This can include discounts for maintaining a 3.0 GPA or majoring in a specific field of study while in school. Additionally, keeping and maintaining a good driver discount will likely lead to lower prices as a teenage motorist gets older. It’s important for younger drivers to shop around and explore their resources to find cheaper rates, and work towards reversing the poor accident statistics that generally lead to high-risk auto insurance for teenagers.

Car Insurance Community Rejects Consumer Group’s Conclusions

A new report released this week by the Consumer Federation of America (CFA) says that premiums have become an undue economic burden on low- and moderate-income (LMI) Americans and that state regulators should do all they can to reduce costs for this group.

“What is undeniable is that high auto insurance costs for LMI households either impose a substantial financial burden or greatly limit economic opportunity, especially access to jobs,” said the report’s authors, who are a former Texas regulator and the executive director of insurance at the CFA.

The CFA report makes three major recommendations to help right the situation: move to slice state-mandated minimum liability limits, create special programs for low-income Americans to get cheaper coverage and eliminate elements of the pricing process that hurt LMI households.

But members of the auto insurance community have been lashing out in response to the report, saying that placing more regulation on insurers would decrease competition in the marketplace, which could in turn actually end driving costs up for consumers.

“The most effective way to lower the price of auto insurance is reduce the costs of underlying factors” like the cost of health care and abuse of the system, said Robert Hartwig, president of the Insurance Information Institute (III). “Changing rating factors that have been shown to accurately project future losses will only distort prices and result in good drivers subsidizing riskier ones.” Read more…

Young Drivers with Compulsory Connecticut Auto Insurance

All motorists in Connecticut are required to carry automobile insurance. For teenage drivers in the Constitution State, vehicle coverage frequently involves higher premiums and more extensive comparisons. The risks associated with being an inexperienced motorist generally translates into higher coverage costs. Statistically, teens are at a greater risk of being involved in an accident than older drivers, and consequently insurers often charge more for auto protection. Finding an adequately priced plan usually involves extensively comparing quotes and researching alternative methods of meeting CT financial responsibility requirements.

Insurers generally set Connecticut automobile insurance premiums after determining a driver’s risk of filing a claim. Motorists who pose a greater risk are frequently charged more, while safe drivers usually encounter lower premiums. Statistically, younger motorists have a higher chance of being involved in an accident than any other age group. Although the Constitution State already enforces various restrictions on teen drivers, auto accidents are still the leading cause of death for residents between the ages of 15 and 19.

CT insurers are aware of the unfortunate statistics surrounding teenage motorists, and raise premiums for younger drivers to compensate for the risk of providing insurance to higher risk drivers. To find adequately priced coverage, younger residents should compare estimates from multiple companies. Individual insurers are likely to provide unique quotes, giving motorists the opportunity to find more affordable vehicle protection.

Getting Auto Insurance for Young Connecticut Drivers

Insurers in Connecticut often target different customer demographics. While the majority of coverage providers choose to insure motorists in the preferred and standard market, there are some companies that specialize in high-risk coverage for those in the non-standard market. Shopping around and comparing quotes can lead to cheaper insurance because it provides drivers with options.

A popular alternative for many younger motorists in CT is to join the policy of a parent or guardian. If a teenager is having difficulty locating an adequately priced plan, being added to an existing policy can be a cost effective way of remaining insured until the younger motorist can purchase their own coverage. However, motorists should note that when a high-risk driver is added to an existing plan, the premiums of every vehicle on the policy are likely to increase as a result.

Avoiding accidents and citations as a younger motorist can lead to cheaper vehicle coverage in the future. However, there are Safety Tips and Laws That Parents and Young Teen Drivers Must Know to avoid potentially serious consequences and higher coverage costs. Younger motorists in the Constitution State usually receive harsher punishments for texting while driving, speeding or driving recklessly. Most of these violations can result in a fine and a license suspension, and will likely result in higher insurance premiums as well.

Survey: Many Drivers Ignore Own Safety Advice

A new survey from the AAA Foundation for Traffic Safety provides the latest proof that most motorists talk a better game about driving safely than they actually put into practice.

According to the results of the national survey released this week, 86 percent of motorists consider it unacceptable to drive without a seat belt, yet 23 percent admit to doing so within the past 30 days, and 19 percent confess to committing the traffic violation more than once.

In another example of drivers’ actions being out of sync with their attitudes, 97 percent said driving after drinking alcohol is unacceptable—and 76 percent called it a very serious threat to their personal safety—but more than 14 percent of respondents said they had driven when they believed their blood alcohol content (BAC) was close to or over the presumptive limit of .08 on at least one occasion within the last year. And 21 percent admitted to doing so within the previous month.

AAA officials said the survey shows that more needs to be done to keep roadways safe, despite statistics from federal safety officials that show 2010 saw the fewest number of deadly vehicle crashes in six decades.

“Even one death on our roads is unacceptable,” Peter Kissinger, the foundation’s president and chief executive officer, said in a news release. “Something is terribly amiss in our traffic safety culture when, in the safest year since 1949, on average there is still one needless death every 16 minutes in motor vehicle crashes.”

The survey is just the latest to demonstrate the apparent disconnect between motorists’ beliefs about safe driving habits and how they actually drive.

According to another survey released by the foundation in November, 32 percent of respondents said they had driven within the past month while barely staying awake, despite the fact that 96 percent described so-called “drowsy driving” as unacceptable and 56 percent said they think those who engage in that risky behavior constitute a very serious safety threat.

Officials with the National Highway Traffic Safety Administration (NHTSA) say that drowsy driving contributes to more than 100,000 crashes, 40,000 injuries and 1,550 deaths a year.

But safety officials point out that those statistics are probably unrealistically low because driver fatigue—which leads to slower reaction time and information processing, as well as reduced vigilance—is consistently underreported as a cause of vehicle crashes.

NHTSA says the motorists most likely to drive despite being drowsy are males from 16 to 29, people who work at night or put in long or irregular hours on the job and those with untreated sleeping disorders.

Those findings bolster long-held views within the insurance industry, which has long considered teens a greater risk than other drivers to cover, a belief that makes it difficult for many families nationwide to fine inexpensive car insurance for teens.

Federal safety officials announced late last month that there were only 32,885 highway deaths last year, the lowest level since 1949, despite the fact that automobile traffic was up 1.6 percent over the previous year.

There was also a 4.9 percent reduction from the previous year in the number of people killed in crashes involving drunken drivers, with 10,228 people dying in such accidents last year.

But according to the foundation’s most recent survey, most motorists still fail to live up to their own safe driving standards.

The survey found that 94 percent of drivers consider texting behind the wheel to be a serious risk, yet 35 percent owned up to reading a text or email while in the driver’s seat during the past month and 26 percent said they had sent a message while driving within the preceding 30 days.

And whereas 74 percent of drivers thought it unacceptable for drivers to exceed freeway speed limits by more than 15 mph, 52 percent had done it anyway. Also, 96 percent of those polled said they thought it was unacceptable for someone to drive when they are so tired they can barely retain consciousness, but 32 percent said they had been guilty of that lapse in judgment.

“We are moving in the right direction when it comes to safety on our roads, but we need to do much more,” Kissinger said. “Changing driver behaviors is not rocket science… it’s harder. Take the first step and make a personal goal to be a safe driver in 2012.”

Rating Rhode Island Car Insurance Companies

In Rhode Island motorists must be insured to legally drive, but they also have the ability to choose their own coverage provider. Making that decision should involve careful research and rating. In the Ocean State there are over 740,000 licensed drivers and many different coverage providers to choose from. Not all companies are created equal, and some insurers may be more affordable, more helpful and more financially stable than others. Luckily the investigation of these qualities is a process that can be largely accomplished online.

Rating Rhode Island auto insurance companies based on coverage costs is a task that motorists are urged to complete individually. Insurers often use unique methods for determining premiums, and policy prices are likely to be different for individual vehicle owners. Quote comparisons can be completed online where dozens of estimates can be amassed at once. But before choosing an insurer based solely on price, RI motorists should also investigate and rate additional qualities as well.

Insurance companies in the Ocean State commonly provide unique services. Residents are encouraged to contact several potential insurers to find out about special discounts or features that can make maintaining a policy more affordable or convenient. Many companies provide rate reductions for a variety of reasons, but some insurers may also offer customers helpful additions such as online billing or accident forgiveness.

Additional Ways to Rate RI Insurance Companies

After purchasing a policy, many motorists stay with the same company for years. For this reason, it is essential to rate the financial stability of a coverage provider before buying a plan. As time has shown, no company is entirely exempt from financial ruin, and maintaining a policy with an insurer on the verge of bankruptcy can result in future complications. To help vehicle owners better understand the financial background of Rhode Island insurance companies, many businesses regularly rank insurers based on their creditworthiness, financial strength and investment history, then post the findings online for residents to evaluate. Read more…