Smart Auto Insurance Blog

Hurricane Sandy, aka “Frankenstorm”, is approaching the east coast of the United States and is expected to hit in the next few days.  As Americans make preparations for the storm by stocking up on food and water or even evacuating their homes, auto insurance companies are making preparations for Hurricane Sandy as well.  Reuters’ Ben Berkowitz talks about what they are doing in “Insurers prepare for impact of Hurricane Sandy.”  Insurers are ready for a storm of their own once the claims start filing in.  They prepare for big storms like this by prepping claims teams and sending adjusters to the locations they believe will be hit the hardest.

A spokesman for Travelers Insurance said that they have employees and other resources positioned so that their clients will get help as soon as possible after the storm hits.  They are the second largest personal home, auto, and commercial insurer in Connecticut and the third largest in New York.  Customers in both of those states are expected to be hit hard by Hurricane Sandy.  Travelers has also had to put plans in place to keep their business running smoothly across the country since a large number of employees will be working in those two states.

Lucky for insurance companies, 2012 hasn’t been too bad of a year for financial losses.  With billions of dollars of losses forecasted for Hurricane Sandy, the industry is braced to handle the claims and doesn’t expect any delay in processing because of the storm.  State Farm is the leading insurer in New York and New Jersey.  They said that they have catastrophe teams waiting to respond when the storm hits.  Allstate has teams waiting in North Carolina, Virginia, and Pennsylvania.  Private insurance companies think that the majority of their claims will be from wind damage to autos and roofs.  They also worry about business losses if businesses are out of power for a prolonged time.  Insurers are pleading with Americans to heed evacuation orders before it is too late to reduce some claims.

The continuous stream of auto insurance commercials on TV bragging about their lower rates may have consumers believing rates are down.  Unfortunately, this is not the case.  Auto insurance rates have increased about 10% between 2008 and 2010 based on smartmoney.com’s report from the Insurance Information Institute.  It doesn’t stop here.  Rates are expected to rise further this year by around 4%.  In the last 10 years, rates have risen by 30% causing financial strain on millions of Americans.

The executive director of advocacy group Consumer Watchdog, Douglas Heller, points out that this is a very different picture than what is painted in the media.  Many consumers don’t even realize they are paying so much more for their auto insurance coverage.  Larry Thursby, vice president of personal auto insurance for Nationwide Mutual Insurance says it’s cost-based pricing and as costs increase for the insurers, price hikes are passed on to the consumer.

The article “Auto Insurance Rates On the Rise” by Jason Collazo on Forbes.com talks about how increasing medical costs are making auto insurance rates higher.  Exorbitant medical bills auto insurance companies have to cover for injuries due to auto accidents are making rates increase.  This is in addition to more expensive parts and more expensive labor.  These high rates are pushing more drivers to go without auto insurance even though that is against the law.  About 16% of drivers are currently unemployed, and this number could increase as rates go up further and the economy continues to struggle.

Written by Sara Smart

Follow me on Twitter: SaraSmart55

With the economy remaining somewhat stagnant, it’s always great to hear about major promotions at big companies.  Founders Insurance has recently promoted two outstanding employees to new positions with the hope of making the insurance company stronger.

Sharon A. Poradzisz was promoted to vice president of personal lines claims.  Poradzisz has over 16 years of experience in the insurance industry and joined Founders Auto Insurance in 1997 and quickly was promoted to claims customer service manager.  She then was promoted to senior claims manager and then commercial claims manager.  She is actively pursuing the Chartered Property Casualty Underwriter (CPCU) professional designation to further her experience.

Wade D. Rankin has been promoted to commercial claims manager at the Founders Insurance Co of Des Plaines, Illinois.  Rankin has been with the company since 2010 as a senior claim analyst in the commercial division of the insurer’s claims department.  He has valuable previous experience in the legal and insurance industries.  Previously, he was a law clerk at an insurance defense law firm.  Before coming to Founders he worked in the excess casualty unit of another insurer.

This information was obtained from the Insurance Journal website, notifying the public of these newly promoted employees, recognizing all of their hard work.

Written by Sara Smart

Follow me on Twitter: http://twitter.com/#!/SaraSmart55

A recent press release from Business Wire announces that Progressive Auto Insurance has been recognized for excellence in online auto insurance assistance.  In today’s online environment, more and more consumers are turning to the Internet to compare auto insurance quotes and benefits.  ProgressiveAgent.com offers a wide variety of services making the user experience easier and more straight forward and this has been recognized through receipt of the Standard of Excellence award from the 2011 Web Marketing Association’s WebAwards competition.

Progressive’s Agency distribution business leader, Karen Barone, says this website was specifically designed to make it easier for consumers to use a local agent and also help agents grown their businesses.  They feel honored to receive this award and feel good that they are doing things right.  ProgressiveAgent.com helps consumers find quotes, find a local agent, and also research insurance options.  You can learn more about Progressive’s variety of insurance options including boat, commercial auto and motorcycle insurance.

The judges at the online awards competition say ProgressiveAgent.com is useful and easy to navigate.  Many websites are looked at and seven criteria are considered.  This includes design, copywriting, innovation, content, interactivity, technology, and ease of use.  Websites across the nation are considered and 96 industries were reviewed by judges.  This is a great opportunity for websites to compete and show off their best practices through the competition.  Overall, it should make user experience better for all consumers turning to the Internet for their shopping needs.

Written by Sara Smart

Follow me on Twitter: http://twitter.com/#!/SaraSmart55

Even though auto insurance quotes are quick and easy to obtain, and almost every state requires coverage, 1 in 7 people still choose to go without auto insurance.  This surprising number has increased slowly over the years, probably due to the economic downtown that is affecting so many Americans.  According to industry experts, 13.8% of motorists are uninsured and these causes higher rates for everyone who follows the rules and remains insured.

The article “One In Seven Drivers Have No Insurance” by Larry Copeland on USA Today, points out that insured drivers end up paying more because of uninsured drivers.  This came out to around $10.8 billion in 2007 based on recent data from the National Association of Insurance Commissioners.  David Corum, vice president of the Insurance Research Council, a non-profit group, says the number of uninsured drivers has been studied closely.  The consequences for not carrying coverage do not appear effective even though most states do require insurance coverage.

Loretta Worters, vice president of the Insurance Information Institute says auto insurance is compulsory in every state but New Hampshire but laws have proven ineffective in reducing the number of uninsured drivers on the road.  The state with the lowest uninsured rate is Massachusetts at 4% and the highest is Mississippi at 28%.  This huge difference is also surprising.  Obtaining auto insurance quotes has never been easier with the Internet instantly comparing multiple quotes, but this isn’t powerful enough to combat the fact that many Americans simply cannot afford the rising costs of auto insurance.  It will be interesting to see if these statistics change as the economy repairs itself.

Written by Sara Smart

Follow me on Twitter: http://twitter.com/#!/SaraSmart55

Hurricane Irene has devastated many areas of the US and its estimated that at least 18 people have died as the storm moved from the Caribbean all the way up to New England.  The article “Hurricane Irene’s Damage, State by State” by Drew Armstrong on Bloomberg.com states that about $3 billion in damages have occurred and power was out in over 6 million homes and businesses throughout the east coast.

State Farm Mutual Automobile Insurance Company is the largest US home and auto insurance company in the nation and they’ve reported about 1600 homeowners insurance claims and about 500 auto insurance claims in just North Carolina and Virgina.  The number of claims will surely increase over the coming weeks.  State Farm received reports of siding and roofs blown off of houses and much destruction from the falling of trees.  There have even been claims for loss of food since the power outages have made food in refrigerators spoil quickly.

In the New York area, where the storm had weakened, claims are standing at about 360 homeowners’ claims and 60 auto insurance claims, but this is only after a few days.  People are still getting settled and assessing damage before calling their insurance company.  Storms such as Irene can cause slight increases in auto insurance quotes to account for all of the claims, but this generally happens over time.  Insurers across the nation are working hard to fulfill claims as efficiently as they can to ensure costs do not soar.  Sometimes, when there are heavy claims filed, insurers are quick to give out money to save time.  Hopefully insurance companies were prepared enough for this storm that it will not happen this way across the board.

Written by Sara Smart

Follow me on Twitter: http://twitter.com/#!/SaraSmart55

Auto insurance quotes in Florida continue to rise and this is causing some serious concern for consumer advocate groups in the state.  According to the article “Fla. Consumer Advocate Focusing on Auto Insurance” by The Associated Press on MiamiHerald.com, Florida’s insurance consumer advocate is forming a solid group to address the issue of increasing auto insurance rates.

Robin Westcott, appointed by Chief Financial Officer Jeff Atwater, points out that one of the main reasons rates continue to soar is because of the no-fault coverage for personal injuries layout of Florida auto insurance law.  Westcott is encouraging those who have stake in the personal injury protection system including lawmakers to considering these groups and join to show support.  This would be a huge move in the industry to work towards bringing rates down for the residents of Florida.

Westcott says she hopes to submit the group’s research to Atwater and the Florida Legislature by November of 2011 and make serious strides towards a solution.  Florida’s rising rates have been an issue for many years now and the way the law is set up is encouraging rates to keep rising.  Something needs to change to protect Florida drivers from experiencing some of the highest auto insurance quotes in history.  The time and effort it will take to implement changes is huge, so the more support they can rally the better.  Florida residents need a voice to ensure rates are kept affordable.  Times are tough enough without the rising costs of auto insurance.  Since auto insurance costs are necessary for most Florida residents, it should be a top priority for lawmakers.  Time will tell if their efforts will pay off in the end.

Written by Sara Smart

Follow me on Twitter: http://twitter.com/#!/SaraSmart55

Missouri auto insurance regulators have updated the public with some storm data about claims throughout the state.  According to the press release found on WiredPRNews.com, Missouri residents have collected approximately $750 million from insurance companies from claims filed throughout the storms that hit Joplin back in May.

John M. Huff, who is the director of the state Department of Insurance encourages consumers to contact their department or their insurance company if they believe they may be eligible to file a claim.  Huff and other officials believe the department and insurance companies have done an excellent job helping the people of Missouri who needed it most through the quick fulfillment of claims.

Area regulators previously announced in June that Missouri insurers of auto insurance as well as other coverages, had paid out around $500 million in claims with auto claims specifically making up over $34 million.  This number has steadily increased throughout the summer as claims were filed and insurers met their needs.  About $250 million was paid out in early July alone says the Department of Insurance.

Altogether, almost 17,000 claims have been submitted as a result of the disastrous tornado that devastated the area.  Huff believes that total claims could hit up to $2 billion altogether.  The claims that are still pending at this point will be difficult to resolve and may take some more time.

Written by Sara Smart

Follow me on Twitter: http://twitter.com/#!/SaraSmart55

New Jersey auto insurance consistently ranks as one of the highest states for auto insurance rates and regulators are looking to curb some of the rising costs through new regulations.  The article “What the New Car Insurance Rules Mean for NJ” found on NECN.com answers some of the top questions New Jersey residents have about how the new regulations will affect them.

New Jersey auto insurance is looking at a big overhaul from the proposed regulation changes for the personal injury protection component of auto insurance policies.  The changes will essentially change how and what physicians can charge for treatments and there will be a restructuring of the process for appealing a denied claim.  This is all in hopes that rising premiums will be slowed down and New Jersey auto insurance will become more affordable.

The article is very useful in answering questions many residents have.  It answers some details about personal injury protection and outlines why the system needs a makeover at this time.  The changes to medical services are discussed and gives an understanding of the changes being made to the approval and dispute process that New Jersey has long known.  Insurers will be benefiting from these changes in addition to the consumer so hopefully this encourages auto insurance companies to support the proposed changes and regulations are put into place quickly.  The regulations are not quite a done deal since the public has until the end of September to comment and a decision will be made at that time.

American Commerce Insurance, which offers auto insurance, has received an A+ rating from the rating agency Satndard & Poor.  According to the press release on the American Commerce website, the financial strength rating from increased from an A on MAPFRE USA’s subsidiaries - Commerce and Citation - and the outlook is promising.  They consider the companies to be strategically important and because of this their credit rating has been raised from BBB to BBB+.

AM Best also continues to rate MAPFRE companies as A+ Superior.  These high rating are truly key in the success of companies such as American Commerce.  Standard & Poor’s report says that the decision reflects their capitalization and states that their future is very strong.  The rating agency also says in their report that MAPFRE USA continues to have a strong competitive position in Massachusetts and they have a strong market presences in auto insurance specifically.  They carry about 29% of the personal auto insurance market and about 12% of commercial auto insurance products.

This report is a huge success for the company.  American Commerce and MAPFRE companies pride themselves on offering superior products and top notch customer service.  With their solid book of business, this continues to be the case.  The report also highlights the strength of their underwriting discipline and the strong management behaviors.

Written by Sara Smart

Follow me on Twitter: http://twitter.com/#!/SaraSmart55