Over 30% of people surveyed in a 2011 MSN Money-Zogby survey, rate Progressive’s customer service “poor.” Progressive has been around for over 8 decades and is the nation’s 4th largest auto insurer. They have an aggressive marketing campaign buying millions in on and offline advertising, direct sales, innovative customer options and competitive rates.

But Progressive Insurance has been alleged to make customers discuss use low-cost auto shops, get inadequate repairs, or low ball reimbursements. Progressive responded with a Forrester Research award for the company’s customer feedback.

In the J.D. Power 2010 customer-satisfaction index, Progressive won a 775 score, below the average score of 777 out of 32 US auto insurers. Progressive profited over $1 billion profit in 2010.

By Jeff Jeffrey

Metropolitan Direct Property and Casualty Insurance Co. has withdrawn its request for a 5.8% increase to its automobile insurance rates in California after a consumer advocacy organization challenged the filing. Consumer Watchdog, the California-based organization that challenged the rate request, estimated the rate increase would have generated $6 million for Metropolitan Direct.

If the rate request had been approved, it would have affected roughly 78,000 California drivers. Metropolitan Direct is a subsidiary of MetLife Auto & Home Group.

Todd Foreman, a staff attorney at Consumer Watchdog, who led the organization’s challenge, said his organization had concerns with how some of the data Metropolitan Direct included in its filing were presented. He said the company did not properly include data on loss trends and the data that were included had “considerable inconsistencies.”

“The Department of Insurance granted our request to intervene, and two days later the company withdrew its application for a rate increase,” Foreman said. “It was definitely a victory for Consumer Watchdog and for consumers in California.”

A company spokesman said in an email Metropolitan Property and Casualty “has observed some changes to its loss experience, and is going to make a new filing with data as of the end of the first quarter of 2011.” The filing will be made by June 1.

Consumer Watchdog’s challenge to the proposed rate increase was made under California’s insurance reform law, which allows any individual or organization to challenge proposed rate requests. That law, known as Proposition 103, does not cover health insurance requests.

Consumer Watchdog is working in support of a newly introduced bill that would create a similar rate regulatory scheme for health insurance rate requests, Foreman said. A.B. 52 is scheduled to be considered by the California Assembly’sHealth Committee on April 26.

Insurance Commissioner Dave Jones, who has been a leading voice in support of A.B. 52, has been stepping up the pressure on insurers making rate requests in recent months, particularly on the health insurance side of the market. Earlier this year, Jones asked four health insurance carriers to delay any rate increases for two months while the Department of Insurance reviewed their requests.

In March, Anthem Blue Cross Life and Health Insurance Co. slashed its rate increase from 16.4% to 9.1% and delayed implementing increases to co-payments and deductibles by 10 months from the effective date the company had originally requested. That cut was expected to save Anthem Blue Cross individual and family plan health insurance policyholders at least $40 million (BestWire, March 22, 2011).

Also in March, Blue Shield of California Life & Health Insurance, another of those companies, withdrew its request to raise premiums on any members in its individual or family health insurance plans for the rest of this year after Jones called its request excessive (BestWire, March 17, 2011). Another company that Jones asked to hold off on rate increases, PacifiCare of California, agreed to defer its premium increases by 60 days beyond their anticipated effective dates (BestWire, Jan. 31, 2011).

Metropolitan Direct Property and Casualty Insurance Co. currently has a Best’s Financial Strength Rating of A (Excellent).

By KATE FORGACH

There ought to be required reading in school to prepare us for buying auto insurance. We need training for reading insanely confusing policy details, imagining worst-case scenarios for ourselves and our loved ones, and weighing the cost of this future doom against a monthly premium payment.

Instead, we find ourselves shopping for insurance with no idea of what we’re about to do. No wonder people hate it. No wonder people throw up their hands in frustration and just shell out as much as cash they can afford, and never review the policy again. In what other arena do we seriously consider our own destruction and possible death?

So here’s help for you to decide if you still need full-coverage auto insurance, along with a tips on reviewing your current policy. Insurance is a product. You can save money on it just like anything else.

1. Do you drive a car?

You must have minimum insurance coverage as required by your state. Full coverage auto insurance generally refers to a policy that includes comprehensive and collision insurance, in addition to the state minimum.

2. Have you paid off your car loan?

You should know up front that, unless you have paid off your car loan, you won’t be able to drop full coverage. You may play with the deductible to make this more affordable, but you do need full coverage until you’ve paid off your car loan

3. Do you already have auto insurance?

After the purchase price, auto insurance can be the most expensive aspect of owning your car.. Adjusting your policy can lead to substantial savings and more affordable auto insurance. It’s absolutely worth reviewing your policy and comparison shopping every year.

4. What is your car worth to you?

Comprehensive insurance covers you if your car is stolen and not recovered, or damaged by anything other than a car accident (e.g. fire, flood or act of God). This will pay for your car to be fixed or replaced for the amount your insurance determines to be the car’s actual cash value, minus your deductible. For a general estimate of your car’s worth, consult the Kelley Blue Book.

5. What is your car worth to the insurance company?

Get out your calculator and do the math on the last question. Look up your car’s value in the Kelley Blue Book. Subtract your deductible. Don’t forget to also subtract the amount of your car loan. This is what you will receive if your car is totaled.

6. What is your car worth to someone else?

Before you decide to write off comprehensive coverage based on the results of your math, consider the 10 most commonly stolen cars in the United States are more than a decade old. So even if you drive an older car and can’t replace the car yourself, you might want to keep your comprehensive insurance.

7. Are you a careful driver?

Collision coverage pays for repair or replacement (minus your deductible) in the case of a crash. Some people think, “I drive like granny and will never crash, so why bother?” The idea is to pocket the money you’d otherwise send to insurance. However, when you are hit by the teenager who mistakes the gas for the break, you may reconsider the wisdom of this. Are you really driving a junker?

8. Is your car European, or an “old reliable” Honda or Toyota?

In this case, it may not make fiscal sense to keep collision coverage because the price of parts could be through the roof. Damage to a single part can “total” a low- or mid-value car, even if it’s otherwise drivable. A fender-bender could result in a total loss. Look at your math from question five. Would it be difficult to buy a replacement with the Blue Book value, minus your deductible (and car loan if you have one)? Your money is better spent in saving for a new car.

9. Where does your car live?

Urban drivers face many more automobile hazards than suburban or rural drivers. If you’re carrying full coverage and do little to no city driving, consider changing your auto insurance policy.

10. Is your car new?

A newer, more expensive car ought to carry full coverage. Just review your policy as the car ages. You may even have a point in mind to begin switching over from insurance to saving for a new car. Overall, the one that is best for you is the plan that will give you enough money to put you back on the road after a loss.

Premiums for nine driver profiles were calculated across four California insurers. All of the profiles were unmarried females of different ages who live in Los Angeles. OAI compared the prices for the same policy when the driver was 16, 17, 18, 19, 25, 35, 45, 55 and 65 years old. The results showed that:

- The average cost of coverage for a 16-year-old was about 184% higher than the average for a 65-year-old.
- Average prices made their first big drop between the ages of 18 and 19, when they went from $4,888 to $3,500 — a 28% decrease.
- Average premiums declined from 16 until the driver was somewhere between 35 and 45 years old, when they began to rise slowly.

To anyone who has had to purchase coverage for a teenager, these results are likely not a surprise. Teens are regularly regarded as a high risk car insurance group because of their higher-than-average accident rates. According to the Centers for Disease Control and Prevention, “Per mile driven, teen drivers ages 16 to 19 are four times more likely than older drivers to crash.”

But then why such a big price-break for 19-year-olds? In the 1980s, California voters approved Proposition 103, which dictated the types of factors insurers in the state could take into account when setting rates. Since its passage, auto insurance providers in the state have been required to give a policyholder’s years of driving experience the third-largest weight out of all eligible factors.

In addition, it instituted a mandatory good-driver discount that ensured motorists who have been driving for three years without any major violations or accidents get a 20 percent discount on rates. Since all of the driver profiles had no accidents, this could at least partially account for the drop, since it is only at the 19-year mark that the driver would have had 3 years behind the wheel and that the discount would kick in.

Note on methodology: Rates were calculated for liability, comprehensive and collision coverage with $500 deductibles for a 2009 Toyota Corolla LE. All driver profiles were unmarried females who live in the 90010 ZIP code, have no accidents or violations on record and drive about 12,000 miles a year.

According to a recent online study conducted by Harris Interactive, 16% of American drivers say they have driven without any form of auto insurance. Nearly half of these drivers (44%) cited not being able to afford their premiums for the reason behind why they did so.

However, 2% of drivers surveyed took this even further, noting that they’re currently driving without auto insurance.

Looking at the demographics, 28% of American males aged 18 to 34 and 45 to 54 led the list in terms of driving without insurance. According to the survey data, percentage of women who drove without insurance is about half that of men, as just 15% of women aged 18 to 34 said they have driven without insurance—the highest of any of the age ranges.

Overall, men and women combined, drivers aged 45 to 54 were the most likely to have ever driven without insurance (22%), pacing just ahead of the 18 to 34 range (21%). Just 8% of drivers aged 55 and older admitted to having driven without insurance.

Regionally, 20% of drivers in the West region said they’d driven without insurance, followed by the Northeast (16%), South (15%) and Midwest (13%).

The survey revealed that 24% of the drivers who have gone without insurance said the reason for their lapse was that their policy had expired before they had a chance to renew them. Nineteen percent said that a gap in their coverage occurred when switching from one insurer to another, and another 12% said that their insurance company had canceled their policy.

The study, conducted in late February 2011, polled 2,366 drivers aged 18 and older.

USAA, an auto insurance provider has created a list of vehicles that are considered to be the best valued cars in the market today. This is due to the fact that at a time when gas prices are increasing, it is essential to be aware of the vehicles that offer good values in a number of areas, and that also includes car insurance.

The USAA list has taken into account a different number of aspects of car ownership in order to determine what kinds of vehicles provide the best value. The company considered list price, depreciation, safety ratings, ownership costs and auto insurance.

The 2011 best value cars in the list are as follows:

Large Sedan: Dodge Charger
Small SUV: Kia Sportage
Midsize Sedan: Hyundai Sonata
Large Luxury SUV: Audi Q7
Small Sedan: Chevrolet Cruze
Midsize Luxury SUV: Lexus RX 450h
Large Luxury Sedan: Hyundai Genesis
Large Pickup: Chevrolet Silverado 1500 Hybrid
Midsize Luxury Sedan: Audi A4
Small Pickup: Suzuki Equator
Large SUV: Chevrolet Traverse
Sports: Ford Mustang
Midsize SUV: Toyota FJ Cruiser

If one’s car is not on the list, it is advised that one should look for discounts since auto insurance companies offer discounts for a number of reasons. Another is to consider pay-as-you-drive programs for customers who travel fewer miles or have a good driving record. Another advice is to adjust the deductible, which is a good option for people who are considered safe drivers.

The price of insuring U.S. autos continues to rise slowly, according to the latest report from the Bureau of Labor Statistics (BLS). The BLS’s latest edition of its monthly Consumer Price Index (CPI) indicated that the price of the average auto insurance policy rose by about 0.3 percent between January and February. The costs of coverage is rising at a slower rate than the price of goods overall.

Eleven out of the past 12 month-to-month changes in the price of vehicle insurance have been increases. As a result, the BLS says that the price of a policy in February 2011 was 4.2 percent higher than it would have been in February 2010.

Source: http://bls.gov/cpi/cpid0211.pdf

According to the most recent data from the National Association of Insurance Commissioners (NAIC), the average premium for an American car insurance policy in 2008 was about $903. After factoring in subsequent price changes documented in the CPI, the same policy would cost around $989 today.

But the upward trend in costs does not necessarily mean that consumers are spending more on policies. This is because motorists have the option of shopping around and maximizing savings by adjusting coverage, finding competitive providers and utilizing discounts.

The Bureau of Labor Statistics bases its price-change estimates on a sample of more than 700 policies from all over the country. Changes in insurer rate calculations and state law are reflected in the monthly reports.

Statistics show that teenagers are four times more likely to get into a crash than older drivers, and car insurance companies routinely charge younger drivers more for coverage in order to compensate for the increased risk. Parents and teens should ensure that beginning motorists get plenty of experience behind the wheel under low-risk conditions in order to minimize the chance of getting into an accident.

The new legislation introduced to both houses of Congress would make it a requirement for younger motorists to get a substantial amount of experience by setting a national licensing standard that, among other things, delays the issuance of permits until 16 years of age and of non-restricted licenses until the motorist is 18 years old. It would also call for passenger and nighttime driving restrictions, as well as a prohibition on non-emergency cell-phone use for those in the early stages of the licensing process.

If the legislation is eventually signed into law, states would face gradual reductions in federal highway funding if they did not adopt licensing systems that meet the law’s standards.

This type of licensing process, known as a graduated licensing (GDL) system, has been touted as an effective way to reduce the crash rate for the youngest on the road. “If every state had a strong GDL policy, we could save 175 lives and prevent about 350,000 injuries each year,” according to the Centers for Disease Control and Prevention.

A survey recently released by a major insurance company reported that a majority of teenage respondents were supportive of passenger, nighttime-driving and cell-phone restrictions for those just beginning to drive.

Americans could pay over $80,000 for car insurance over their lives, according to a report by ICOM on auto insurance quotes.

ICOM based its analysis on quotes from drivers who first purchased insurance at age 21, married at 27, briefly insured two teens and stopped driving at age 75. The average premium includes drivers with all types of claims, accidents and other driving histories.

The lifetime cost of car insurance stacks up against other lifetime costs (ages 16 to 75) as follows:

* Shoes at one pair annually (ages 16-75): $2,700 for males, $2,600 for females
* Four years of college: $30,000
* New car every 7 years (ages 22 to75): $150,000

All of the costs are in 2011 dollars and unadjusted for inflation.

Reduce your lifetime car insurance premiums: Paying over $80,000 in car insurance will motivate you to save: A good rule for keeping down your lifetime car insurance costs: Obey traffic laws and don’t get tickets. Carriers classify you as lower risk and give you lower auto insurance rates when you remain accident and ticket free.

Increasing deductibles also reduces lifetime car insurance costs. But don’t that unless you can pay the deductible in an accident. Paying deductibles with high-interest credit cards can be a lot.
Other ways to save:

Get pay by the mile auto insurance if you do not drive much and your state allows it.

Don’t add teens to your auto insurance policy, if you can help it! Make them pay their own insurance and maybe they will slow down.

Drop collision and comprehensive coverage on older cars. Esp. if your car is worth less than $2,000. Car insurers are experts at giving you minimal money for your stolen or totaled car. The higher premiums will just not be worth it.

Comparison shop for auto insurance quotes. Some carriers will surprise you with their different rates.

The annual list of the lowest and highest cost cars to insure, the Kia Sedona is cheapest.

10 least expensive to insure:

1. Kia Sedona
2. Mazda5
3. Ford Escape
4. Hyundai Santa Fe
5. Mercury Mariner
6. Chrysler PT Cruiser
7. Ford Explorer
8. Subaru Outback
9. Kia Optima
10 Chevrolet Equinox

10 most expensive to insure

1. Acura ZDX
2. Audi TTS
3. Audi A5
4. Cadillac Escalade
5. Chevrolet Corvette
6. BMW Z4
7. Lexus SC
8. Jaguar XF
9. Cadillac STS
10. Dodge Challenger

Insuring your new car can add a big, and sometimes unexpected, chunk to your monthly auto costs. That’s why it’s worth taking a few minutes to get insurance quotes on the models you’re considering to help you weed out models that cost more to insure than you want to pay.
The Kia Sedona was the cheapest car to insure in 2010

The Kia Sedona was the cheapest car to insure in 2010

As you can see, the least expensive list is dominated by moderately priced, underpowered cars and family vehicles, while the most expensive list consists mostly of high-powered luxury and sports cars.

True, the cars on the most-expensive-to-insure list may look more appealing, especially for car guys and gals, but if you’re envious of your old Aunt Myrtle’s insurance bill, think about what she would drive.

Would she choose a car with a huge engine that’s costly to repair, or would she choose a slower car that’s cheaper to repair?

The Kia Sdeona minivan is going to save you not only on the list price but also on the insurance.