**Head for the end of this tirade for an UPDATE on how the Minnesota Department of Public Safety and the Insurance Industry MUST be working together to SCREW US!!
Drive a car? Then you've got auto insurance. At least, you're suppose to by law. Ask yourself this question: How do you feel about your auto insurance? Do you feel you're paying to much? Do you feel discriminated against? If you're one of the few who are thrilled with your auto insurance, you won't be after you read this.
From the moment you first started driving, you've been discriminated against. Sure, insurance companies will call it either "demographics" or "statistics". Lets say you started driving at 17, and were living at home, and used Dad's car for a date once a week, and to pick up your sister from confirmation class on Wednesdays. That's it. Your Dad's auto insurance premium just doubled. Even if you're 17 live at home and DON'T DRIVE the insurance doubled, because someday you MIGHT drive! Even though you're doing 2% of the driving, you now account for 50% of the new insurance bill. Why? Because you're a teenager. According to insurance companies, teenagers have lots of accidents. Sure they do. I don't argue with that. But not ALL teenagers do. Some are very careful, considerate drivers. Do they double the rate for the 85 year old driver with bad eyes and no reflexes? No. In fact, he'll get a DISCOUNT as a "mature driver" with many companies. But you don't get a decent rate again till you're over 25 and MARRIED! Now you're discriminated against based on your AGE and your MARITAL STATUS! Imagine if someone did a study and decided Catholics had 8% more accidents than Methodists, or Germans were better drivers than Icelandians, and this was reflected in your insurance rate. How about, since there are more blacks in jails, they are more likely to use their vehicle in a crime, hence their insurance should be higher! Nope, they'd never get away with this! I'd like to point out that I was the exception. I never had an auto accident as a teen ager. My first and only accident happened when I was 26 and MARRIED! Beat the stats myself! One reader of this column suggest an answer for this. Charge the younger drivers extra, but if they make it to, say, 25 with no accident, tickets, etc, then GIVE THEM A REBATE of the EXTRA the company collected during their youthful years. Never happen. You're asking insurance companies to be reasonable!
Oh, but it all gets much worse. I'm just getting started. Your insurance rate is also based on your driving record. If you've got a speeding ticket on your record, your rate goes UP! How many people speed? Everyone does. Everyone should have increased premiums. I've done my own study on this. For the past month, I've made it a point to go exactly the posted speed limit. My day involves driving in 30, 40, and 65 zones, every day. When the 65 turns into a 40, everyone continues go fly right by. Then, when that 40 turns into a 30 most people are finally down to 40. Now, if I continue at 30 the rest of the way to work, I'm tailgated and have people speeding around me in RESIDENTIAL areas. Try it yourself. Make it a point to go EXACTLY the posted speed EVERYWHERE for a week. You'll be darn near run over. Speeding CAN'T be used as a measure of one's accident likelihood, or EVERYONE would have higher rates, and we'd have to reset the standard! Where it transitions from 40 to 65, most people are already going at least 55 a half mile before it's 65! Now, if the police were to set up a speed trap, think of the increased revenue for the insurance companies! I'm surprised the insurance folks haven't already found a way to have their own "insurance cops" out there. Can't give you a ticket, just raise your rates. Now, obviously, if someone has 30 speeding tickets in a month, and a couple reckless or exhibition driving citations, that may indicate a hazard. But speeding? No. In fact, here in Minnesota (and most other states) the freeway speed limits increased from 55 to 65, even 70 or 75 in some areas, but the accident rate has DROPPED. So you're getting discriminated against for being exactly like everyone else. Have you ever noticed that when someone DOES get a speeding ticket, they're not concerned about the fine, they're PO'ed because their insurance will DOUBLE! It's not the courts, or the laws punishing them, it's their own insurance companies! Ahh but the worst is yet to come!
Ever think of this: You have a speeding ticket on your record. You're paying extra already. You have an accident. Then your insurance rate goes UP because you've had an accident. WAIT JUST A DING DONG MINUTE!! According to the insurance guys you've already been paying EXTRA because you have had a ticket, and now you've had the accident they say they KNEW you were going to have. Why does your rate go UP after the accident, when you've been paying a higher rate all along because they say they KNEW you would have an accident?
While we're at it, riddle me this, Batman. I recently had a hunk of road debris crack my windshield. This was not covered by my insurance. (Glass, apparently is not part of the car, like a fender, or bumper, but rather, something that requires it's own insurance, sort of like how health insurance doesn't cover your eyes or teeth, like they're not part of your body..but I digress). So, I had to fork out the dough to fix it myself. I called about 10 different auto glass replacement outfits and asked for a price. Every place I called asked if it was covered under insurance. Well, at the time I was calling, I wasn't sure, so I asked for the insurance price and the cash price. In every case the insurance price was at least double the cash price. Same glass. Same guy installing it. Same van coming to the house to do the job. Cost me $250. Cost my insurance company $500 or MORE depending on the outfit. Who is sleeping with who here?
So, if you're a teenager, your Dad's rate goes up because you exist. If you have the accident the company says you will have, the rate goes up. Then if you get the ticket they say you will, the rate goes up. Remember, you already had a higher rate, because they've predicted these things will happen. Then...well, read on...
Many insurance companies are now determining your rate based on your CREDIT RATING! Here in Minnesota the Attorney General has mentioned that he's out to make this practice illegal. Here's how it works. You've got a crummy credit rating? You pay double. Even if your driving record is spotless. This is the particular discrimination to which I've been victim. I've bought insurance 4 times from various agents, differing companies, paid the agent whatever he needed in cash, up front, only to receive a couple weeks later either a cancellation notice or new bill with over double the premium, based on my credit rating. In fact, it all started when I had parked my Suburban for a season due to mechanical troubles, and drove my Dad's Escort thru the winter while my folks were in Arizona. Naturally, I let the insurance lapse on the Suburban since it was no longer on the road. In the spring, I traded it off, and bought a newer model station wagon. When I went to insure it, I was told my rate would be DOUBLED for the first year, as I didn't have a record of a full year of previous coverage on the Suburban! So, since, we've been battling the insurance gods trying to keep ourselves covered. What sparked this entire tirade is that in between being canceled or screwed, my wife was in an accident, and we weren't covered. We're still waiting to see how that entire mess turns out. (Head for the bottom of the page for an UPDATE!) Even then, the damage to her NEW '98 model car is cheaper to fix out of my own pocket than I would have paid for a years insurance.
The insurance people say they have statistics that show low income people, or people with less that exemplary credit have more accidents. The Attorney General says this is a load of bull. Lets think about it. Who can afford the most expensive automobiles? Who can afford to travel the most? Whose car will be more expensive to repair? The rich guy with the new Lincoln Navigator? Or the poor guy with a 78 Cordoba? They total the Cordoba and give him $500 bucks, and they spend $8,000 repairing the Navigator! But if he's got bad credit, or a ticket, it costs the Cordoba pilot more for the insurance! Who is more likely to be tired, stressed..alcoholic? The low income dude working at the Convenience Mart, or the busy executive with a bottom line to worry about, business meetings to rush to, and a cellular phone to keep in touch with the office while he's zig zagging down the freeway! Hmmm.
Oh..and don't forget, they also sell you insurance in case you're creamed by someone who isn't insured, and they sell you coverage in case you're creamed by someone who is UNDER insured. Odds are, if the guy is uninsured, it's because the whole system is so skewed he can't afford it. But that's OK, the insurance companies made up for it by selling YOU more insurance. Read ANY agents manual or ANY insurance trade publication. The whole idea is to sell you the MOST insurance for the HIGHEST rate possible. Then get you to renew year after year after year.
And why oh why do you pay MORE for coverage for a newer car? I just seems to me an probably to any other thinking animal on earth that the largest portion of cash put out by insurance companies go to medical costs, not car repair. Just ponder that for a moment. So, it costs MORE to insure my "safer" newer car. Everyone tells me it's safer. The car maker. My insurance company. The ads on TV. So, if my new 1999 Ford Aerostar is so gosh darn safe why does it cost four times as much to insure as my 1988 Plymouth Reliant? Does the collapsed lung, three broken ribs and broken leg cost more to fix if you're in an Aerostar?
I'm not sure what the answer is, but as we know, anytime the law requires you to buy something, those selling it are going to do all they can to take advantage of the situation. Maybe minimum auto insurance coverage should be provided by the State for a fee when you get the plates for the car. Base it on the value of repairing the vehicle and a fixed amount for injuries nothing else. Maybe a system can be set up where the constant traffic offenders pay more. Like reckless drivers, exhibition drivers, etc. Then anyone who wants coverage beyond the legally required insurance can get it from their agent. I don't know, but this policy of screwing the average guy to entice the rich has got to stop.
I urge you to contact the Attorney General or Insurance Commissioner in YOUR State and tell them sweeping changes are needed in the industry, or by gosh, one of these days the people will REVOLT!
To anyone wondering if there is a GOD, yes, there is. He goes by the name of the Minnesota Department of Public Safety. They MUST be GOD, as they can make their own rules. To briefly summarize our experience with this fine agency in the months since my wife's fender bender when the car wasn't insured:
1. She went to court. Was fined. End. Period. Fine'. Until...
2. Months later she received a notice from the Minnesota Department of Public Safety that the license plates on the car were being REVOKED, as a condition of having the car registered is that it is insured, so she must RETURN them to the nearest Minnesota license bureau. If the car is now insured, she must re-register the car, and pay for replacement plates. So, off we went to the DMV, where she handed them her perfectly good plates, which they threw out. They handed her new ones, charged us like, $15, and out the door we went. Wow. This was efficient.
3. About a month after the license plate fiasco, she receives another notice from the MDPS telling her that HER license will be revoked for 30 days for driving without insurance. (Note that the judge said nothing about this during the court appearance). To regain her license she must 1. prove the car is insured. 2. Retake the written drivers exam. 3. Pay a fee for a new license.4. Pay a fee for the test. Now, she has to drive to and from work, so they give her a work permit, that allows her to ONLY drive to and from work. The details of this are to complex to relate, lets just say the rules that come with the work permit are impossible to really follow when you work varying hours as a nurse, on call 24 hours a day. She pays all the fees, passes the test with flying colors, and obtains the work permit ALL BEFORE the revocation even goes into effect. NOTE: One of the conditions of getting her drivers license back was that our insurance COMPANY would provide the State with our insurance information. I brought the form to the office where we carry our insurance. The Form CLEARLY STATES: "To be filled out by a representative of the company NOT the AGENT" Our insurance man says he'll have it handled.
4. She get a notice that her driving license is reinstated after the 30 days.
5. She then receives a notice that her license plates are being revoked as she didn't have insurance. WAIT A MINUTE...we ALREADY DID this! Now they want to revoke the NEW plate she got to replace the ones that were REVOKED! A fast firm letter to their office results in no further action on this insanity.
NOTE: Keep in mind that thru all this we are paying TWICE the going rate for our car insurance since we haven't been with the company for over a year, and are being SCREWED based on our CREDIT with the company ONLY!
6. The latest! We receive a note July 16, 6 months after the accident, 4 months after her license is reinstated that her license is being revoked AGAIN beginning August 13th because, and I'm quoting now "Previously certified insurance denied". As near as I can figure, our AGENT filled out the form and sent it in way back when, when it clearly stated the COMPANY must do it, NOT the agent. A check with the agent (who is no longer with the company) shows the form in the file, filled out by the AGENT not the COMPANY like it's suppose to be. He took care of it alright! The MDPS won't trust the agent, won't consider a paid policy as evidence that you have insurance, it must be filled out by a COMPANY rep. The new agent passed the form on to the COMPANY and we'll see what happens. Apparently WE get punished for the AGENTS screw up. AND the Minnesota Department of Public Safety has the power to inflict punishment with NO DUE PROCESS! They really are GODS!
Interesting highlight! Thru all this I made a discovery. Lets say, for example, you wreck your car. You don't have insurance. You decide NOT to purchase another vehicle. Pay attention now. You NO LONGER OWN a vehicle. You HAVE NO car. But you want to be able to drive. Maybe borrow your Mom's car to go to work, or whatever. To get your license back you MUST prove that YOU HAVE auto insurance. EVEN if YOU don't OWN a CAR!! Get this!! On the form that the insurance company has to fill out from the MDPS it says if you need a license and don't own a car to check with your agent about AUTO INSURANCE for people who don't have CARS!! WHAT?!?!?! You have to prove, that even as a NON-AUTO OWNER, you have PURCHASED auto insurance!! It just boggles the MIND!