Insurance Commissioner
California Car Insurance - OMG!
- Thread starter dogememe
- Start date
Yes, the new normal maybe.
We had esurance, great company, its really AllState online insurance.
Anyway, we recently moved from South Carolina to North Carolina. Only a couple miles over the SC border.
When I called to get the address changed I was informed that even though they insure people in North Carolina they are no longer writing new policies in any state.
Meaning if I moved within the state I was insured they would continue to insure me but being I was moving to a new state they could not. I am very well insured and always get super low rates, no claims, no tickets good credit.
Anyway, Jeff in here mentioned Costco Insurance. I always get MANY quotes, Costco was best, even a little better than esurance. Its worth a try, even if you have to sign up for a basic annual membership If you dont have one) you might save a lot, thing is you have to sign up to get a quote. You maybe able to check to see if you can cancel membership if you dont like the quote.
Ah. In FL some of the press was blaming the guy.
It's california. Everything is expensive. Buy a car within the current average price? Pay $600 for registration.
JHZR2
Staff member
I cringe a bit saying this, but I have to wonder how much of this is due to any sort of for profit insurance?
Like other industries (medical for example) ripping off the public, how much goes to CEOs and administration, and bonuses, versus doing the right thing? 20%? 50%?
I find it dubious that most of these insurers really set their rates at 95%+ of their policy intakes, and restrict profitability. And I get it, why should they, they’re a business and often have shareholders or some other mutual arrangement.
Couple that with profitability on repairs performed, ever increasing costs to perform repairs, ever increasing costs on fancier and more complex vehicles, and it’s tough to limit cost growth. Who isn’t going to get theirs?
And then irresponsible uninsured and poorly driving people… increasing risk that they don’t pay for.
Horrible situation. And the attempt to pull costs out of auto repair - direct referral, third world substandard parts, etc. are all sub-optimal.
Buy stock in insurance companies?
Mine too (also with Erie.)
Didn't go up a cent.
However, there is no way in a hot, intemperate climate, that Erie would even consider writing in such an environment as Cali.
That's how they keep the rates low.
I bet it has more to do with how crappy the average person in the US is today. It seems so many people are clueless, so many are playing on their phones while driving and no one seems to care. It looks like the insurance companies have made you care.
There's also a huge number of people always looking to shaft a company, lie, etc., to a "big company" because they think it hurts no one.
IOW, look at the character of the US today, the ethics and behavior....do you really question why these companies that sell policies that have to pay money out when "mistakes" happen are ramping up their revenue??
BTW, I am NOT a fan of insurance companies. But I know I have to have it in some cases and I am very protective of them when it comes to scumbags trying to deceive them, which affects my rates.
Get lots of quotes and possibly reduce coverage if its significantly and you can carry the risk. I don't carry collision on my car or comprehensive, as windshields are reasonably cheap as are body panels at the wreckers. Keeping your driving record clean helps too.
So far our insurance has held pretty even as our personal risk is the same, with simple cars, mostly safe roads, and no claims, no accidents, and low numbers of uninsured drivers.
In theory the insurance fee is covering you, and your car, in your area. Not the unrepairable 100k cars driven by other people in other cities.... Maybe write a letter to your elected representatives if you feel you are paying to insure other peoples vehicles...
So far our insurance has held pretty even as our personal risk is the same, with simple cars, mostly safe roads, and no claims, no accidents, and low numbers of uninsured drivers.
In theory the insurance fee is covering you, and your car, in your area. Not the unrepairable 100k cars driven by other people in other cities.... Maybe write a letter to your elected representatives if you feel you are paying to insure other peoples vehicles...
JHZR2
Staff member
Don’t disagree. But I’m not protective of the insurance companies. They’ll pick my pocket as much as the scumbag trying to defraud them, or the idiot who isn’t paying attention while driving.
Blame goes far and wide.
And the auto situation isn’t the same as say, the roofing companies in TX going to neighborhoods that “may” have seen hail to look for damage. For autos, either you hit or didn’t. Either a repair is needed or it’s not. Don’t get me wrong. Lots of idiots not paying attention or ignoring the rules out there. And lots of big money vehicles getting damaged. But at the end of the day it can’t be looked at by the consumer that everyone can just endlessly profit at someone else’s expense. Unfortunately when it is both best practice to be insured, and mandated to be insured, the consumer is the looser.
JHZR2
Staff member
But the decisions of others to buy them means that somewhere in the calculation of YOUR rates is an assumption of some probability that you’ll cause a loss of such a valuable vehicle. And thus it’s built into the price however small a fraction of overall pricing. The insurer has a level of loss they’re anticipating. Those $100k vehicles are part of the pool of losses.
True in places without no fault insurance like California. In Ontario and lots of other "no fault" states your insurance does cover you and your car, so hopefully I'm no paying too much for my neighbors expensive cars! We also have a separate line for liability insurance for covering property damage and injuries caused by your car.
- Joined
- Jun 8, 2022
- Messages
- 5,566
Don't take this as me defending insurance companies. The people running them are some of the worst people in business. However there is a lot of mis-information being dumped out here.
I'll start with most insurance companies are actually loosing money currently. Its for a number of reasons.
First, what we know as an insurance company is the retail end of the insurance business. The companies we know write individual policies. They then actually buy insurance themselves from re-insurance companies - who are more the wholesaler insurers. They want to make big investments in insurance bets - without the work of the retail end. So a lot of these re-insurers won't write policies in places that have big risks - so no policies in California due to wild fires and earthquakes, no policies in Florida due to hurricanes. It doesn't matter if your nowhere near a fault line or a hurricane area - re-insurers are simply getting out of these states completely for every kind of insurance - home, auto, etc. Some are getting away from any coast all together. This means the retail insurers can't afford to write policies there anymore.
Another reason is insurance companies actually make a lot of their money by investing. They take in $10B in premiums. They pay out $9B in claims. However while there sitting on that $10B they don't just put it into their mattress, they buy bonds and such. With the latest fed hiking cycle bonds have been loosing lots of money. Now that bonds pay more they should catch up in a while, but they lost a lot over the last couple years. This is the same cycle that bankrupted SVB which was all over the news.
How does this help you - it doesn't. You just need to keep shopping around. But the current insurance cycle issues aren't completely about some Gordon Gecko guy in the ivory tower trying to mess up your life. I think its a huge understated risk in the economy right now. If a few big insurers went under, it would be a giant crisis.
I'll start with most insurance companies are actually loosing money currently. Its for a number of reasons.
First, what we know as an insurance company is the retail end of the insurance business. The companies we know write individual policies. They then actually buy insurance themselves from re-insurance companies - who are more the wholesaler insurers. They want to make big investments in insurance bets - without the work of the retail end. So a lot of these re-insurers won't write policies in places that have big risks - so no policies in California due to wild fires and earthquakes, no policies in Florida due to hurricanes. It doesn't matter if your nowhere near a fault line or a hurricane area - re-insurers are simply getting out of these states completely for every kind of insurance - home, auto, etc. Some are getting away from any coast all together. This means the retail insurers can't afford to write policies there anymore.
Another reason is insurance companies actually make a lot of their money by investing. They take in $10B in premiums. They pay out $9B in claims. However while there sitting on that $10B they don't just put it into their mattress, they buy bonds and such. With the latest fed hiking cycle bonds have been loosing lots of money. Now that bonds pay more they should catch up in a while, but they lost a lot over the last couple years. This is the same cycle that bankrupted SVB which was all over the news.
How does this help you - it doesn't. You just need to keep shopping around. But the current insurance cycle issues aren't completely about some Gordon Gecko guy in the ivory tower trying to mess up your life. I think its a huge understated risk in the economy right now. If a few big insurers went under, it would be a giant crisis.
There are plenty of middle class and rich drivers operating a motor vehicle and being distracted on their phone........I see it ALL THE TIME!
I can't tell you how many fatalities have been on the news that come down to either entitlement (not obeying red lights) or distracted driving.
Hopefully when EVS are mandated they will also be fully autonomous and accident rates will be a very small percentage of what they are now.
Or driving without insurance. Though I never have done that, and have no plans of ever doing it, automobile insurance policies discuss uninsured motorists, and there are plenty of them out there driving without insurance and without inspection or maintenance or a driver's license.
Don't worry, there will be enough new perverse incentives baked into the cake by then to drive insurance rates even higher.
Let's take this bit by bit.
Here is some good data on trends over the last few years:
Social inflation is a real issue.
If you study the expense ratios of publicly traded insurers, you will find that most hover between 25-35%. Loss Ratios are running 50-70% nowadays and investment income is minimal.
Not sure if I follow.
Yes, claim severity has sharply increased in the last few years and in a number of states, rate changes have not increased fast enough to contemplate this issue. However, while it is true that PD claims have increased, keep in mind that they take a backseat to the liability payouts.
Here is some good data on trends over the last few years:
Social inflation is a real issue.
Always an issue, but hardly the main drivers.
Retention will vary depending on the structure of one's book and every carrier has some form treaty reinsurance in place. Reinsurance costs have definitely risen but they are only part of the overall issue. Fundamentally, reinsurance is a risk management strategy for the carrier but it requires both parties to have "skin in the game."
IF you buy a $20,000 to $100,000+ car, motorcycle or boat in South Carolina the max sales tax is $500.
But you will local pay yearly county property tax on it. Dont know how it works in CA
*LOL* Registration would most likely be $40
Similar threads
