Auto insurance rant

WTF is up with auto insurance rates?

Here's the story. I've been a licensed motorist in NYS since 1986. I have never had an accident, and have used the same insurance agent since I was 18 (I'm 37 now). About three years ago I developed some health problems which affected my ability to work and thus my ability to pay for some basic things. So, I gave up my car.

Well, now I'm in much better health, working again and am purchasing a very low mileage '95 Mercury Sable which I've been trying to get insurance on. The rates I'm being quoted are outrageous! The friendly little insurance agency I've used for all of my adult life is quoting me up to $1,000+ for six months. The lowest rate I've been quoted is $507 per six months. Folks, this is on a 10 year old car worth $3,000 max.

When I asked friendly small-town insurance agency what was going on, the woman said, "Things are expensive now." OK, I'm willing to believe that rates have gone up over three years but I was only paying $408 every six months in 2001, and that's with comp. and collision.

Here's what I think is going on. When I became ill, I very quickly racked up massive hospital bills. I was uninsured and my credit very quickly went to hell. Add in another three years of virtual unemployment and my credit rating is utter crap. However, since I began working again I've paid off a lot of debt and even a couple of credit card companies seem fit to send me plastic again (albeit with really low limits). Quite honestly, I think what is happening with the auto insurance is that they're running my credit report and assigning me into a high risk pool based on bad credit; i.e. deadbeats == bad drivers.

Am I out of my mind here? Should I get myself fitted for a tin-foil hat? Ant advice?

P.S.: Don't recommend Geico. They've quoted the highest rates of all.

There should be some kind of advocacy group for people in your situation. Insurance companies suck! I wish I had something better to tell you.

However, GEICO quoted me very low rates compared to other companies. I'm very happy with them. :shrug:

I live in Kansas and our state insurance commissioner made a big stink over this last year. Apparently, it's perfectly legal. But I agree it sux.

We have two kids. The 21 year old doesn't drive. Our 25 year old is trying to find insurance and is getting ridiculously high quotes because there is an unlicensed driver in our household. Now does that make any sense? What do they think, that unlicensed drivers are more likely to have accidents? I wonder if we agreed to lock him up and not let him near his brother's car??

For a while my father was getting charged about $1200 a year because both my brother and I were "unlicensed drivers." This was back in like 1984.

...and not just a little bit more likely but a great deal more likely.

Is there any way you can deal with whatever issue is causing your 21 year old not to be able to get a license? Failing that, assuming he is blind or something and can prove he doesn't drive, maybe there is a way to document this for your insurance agent?

Unfortunately, even blindness might not convince them. I have a blind relative (macular degeneration) and she drives -- I don't expect a happy ending to that story.

I had insurance with AmericaFinancial (Hanover). I was hit headon by an uninsured driver in NH (where you can legally drive uninsured). Hanover paid my medical bills ($10,000), fixed my Subaru, which should have been totalled ($17,000 in repair on a car worth $23,000 and 2 years old.) When it came to making a settlement nearly 2 years later, Hanover dug deep into my past, claimed that an accident I had 12 years ago was the cause of my recent migraines, neck pain, etc. $7500 was their first offer. Months later, they offered $10,000, then finally $15,000. My lawyer got 1/3 of that settlement. I found out afterward that they are a badfaith insurance company, meaning they will do everything in their power to not pay up.

Go to http://www.badfaithinsurance.com and find out if your company is one of the bad ones. Read the info provided on that site. It's an eyeopener to realize that insurance company own your state.
And yes, they do run your credit.
And, call Geico several times. I got one rediculous quote for an older car, but when my husband called, he got a rate of almost $300 cheaper.
Hope this helps.

Fortunately, I'm not looking at dealing with any of those companies!

Was that the insurance companies invested heavily in the stock market. When it dived, they all took a hit and raised the rates on everything to keep their profitability up.

In effect, you're paying for their poor judgment and eternal greed.

Might be that they figure if you were too sick to drive, you're probably still a risk.

Or, maybe something automatic, like the computer presuming that time spent not driving is time spent in prison or whatever...

It could be that if you get back on insurance and drive for a year or so with no tickets or accidents, you might be able to renegotiate a lower rate at that point.

Of course, if you were paying $408 a few years ago and are getting a new quote of $507... that sounds like a pretty standard rate of increase. I bet mine's gone up close to $200 a year in the past three years or so.

The insurance racket is a license to steal.

I don't see the issue like you do :shrug:

I think you left out some words, or included a word that wasn't needed, or something...

"Your rates are you $40 a year, with a likely newer car"

:shrug:

"Your rates are up $40 a year, with a likely newer car"

In 2001, I was paying $408 every six months on a three year old car requiring comp. and collision.

In 2004, the lowest rate I have been quoted is $507 every six months on a 10 year old car without comp. and collision. That's a $200 a year difference on a much older car, for much less insurance. That's just the lowest rate quote.

I've had them for almost 10 yrs and they have always come through and are very reasonable. You have to be 25, have good credit and a good record.

I had my son on my policy until he was 21 and then he got his own. The lease was up on his car and it was returned in February, '03. He didn't get another car until June, '03. He called around and had trouble getting insurance because he didn't have it for those months that he didn't have a car. He is paying several hundred dollars more because of the 'lapse of insurance' as they call it. He's with Progressive but is considering going to Geico.

Thanks everyone for your input. What companies are able to get away with today is truly obnoxious.

Just thought I'd let you know that I finally found a reasonable quote utilizing a small, local Central NY insurance company, New York Central Mutual. With comp. and collision the total came to $357 per 6 month period.

I'm overjoyed!

Yes, if you have bad credit, you are also likely to be put in the high risk pool.

You start out in the high risk pool anyway, any time you let your insurance lapse. Too late now, but once you have re-established a good driving record, shop around again, but do not get rid of your old insurance until you have new insurance, or you'll be running into the same thing.

I'm surprised Geico offers to insure you at any price if you're in the high risk pool. A gap of three years in your driving record is pretty huge to insurance companies, I thought in some instances they were only allowed to go back three years.