The insurance industry has become predatory

[Cole Trickle]

Nice timing on this thread, added my 16 year old daughter today. 800 a month for 3 cars, I have 1 ticket , she has the good grade discount and a defensive driving class for discounts. More than double, guess what I’m doing tomorrow. Geico can suck my balls. 3 cars, 2 homes, 2 boats and a jet ski. Lots of policies if someone can be competitive, no claims ever. Looking for advice if there is a better solution.

If you quote apples to apples I think you might be surprised to find what others may quote. Or not quote in todays market.

Report back It might help someone out.

 

[EmpirE231]

How true is something like this, considering the economic conditions we face right now?

I mean if they can't make returns off premiums in the market, it seems like that would be a major catalyst to rate Increases?

View attachment 1225968


Yes, we take calls multiple times a day from people that want to use insurance for sub $5k jobs. We try our best to educate them on the long term issues they will have by going that route. I have gone as far as to offer 90 days same as cash to help some people. We understand how important loss ratios are and do whatever we can to not file a claim, but some people just don't get it.

The market sort of works in that rotation… but there are some other major factors at play. One is reinsurance (this is the insurance that insurance companies purchase to cover large catastrophic losses over predetermined thresholds) reinsurance is a global market and dueto large events globally and even locally (think CA fires and Florida hurricanes)… there are less reinsurance players in the game. Those that remain are raising their rates … meaning the insurance everyone is familiar with has to raise theirs as well.

Another thing I’ve been thinking about that nobody is talking about… not even higher level reps at the companies… is the Silicon Valley bank type situation. Most insurance carriers invest their premiums into bonds and treasuries (safe investments) and due to the rapid fed rate hikes… they are most likely taking significant losses on their investment side. So not only are they taking huge underwriting losses (claims) at this time…. But they are most likely being hammered on their investment portfolio as well. It’s a mess currently.

 

[OldSchoolBoats]

That seems crazy high. I have older vehicles so IDK.

I know!! We are literally scratching our heads trying to figure out what's going on. The agent that I had quote to try and beat AAA said that it is a California problem, especially with auto. Trying to figure it out because there is no way that this is sustainable.

 

[HOOTER SLED-]

Damn....baller tears are loud when they hit the ground.

 

[HTTP404]

I know!! We are literally scratching our heads trying to figure out what's going on. The agent that I had quote to try and beat AAA said that it is a California problem, especially with auto. Trying to figure it out because there is no way that this is sustainable.

Have you shopped it around? I've never used AAA.

 

[Cole Trickle]

Have you shopped it around? I've never used AAA.

Aaa has had a recent rate increase but are one of the few main line carriers that seem to be welcoming new business.

Auto rates have always been ok. Home rates have historically been lower than most.

 

[OldSchoolBoats]

Another thing I’ve been thinking about that nobody is talking about… not even higher level reps at the companies… is the Silicon Valley bank type situation. Most insurance carriers invest their premiums into bonds and treasuries (safe investments) and due to the rapid fed rate hikes… they are most likely taking significant losses on their investment side. So not only are they taking huge underwriting losses (claims) at this time…. But they are most likely being hammered on their investment portfolio as well. It’s a mess currently.

This is kind of what I was getting at regarding the premium investments. These companies always invest in bonds as they have always been a safe haven for return. Obviously that has changed dramatically.

What a great time to be alive.......

 

[Orange Juice]

At some point, the court system will be too messed up to process any kind of liability claim.

When that happens, you’ll need just enough insurance to cover just you.

 

[OldSchoolBoats]

Aaa has had a recent rate increase but are one of the few main line carriers that seem to be welcoming new business.

Auto rates have always been ok. Home rates have historically been lower than most.

Maybe it is a regional thing but we left AAA for HOI on 2018. They were ridiculously high. We saved $1200 / year by switching and that even takes into account our multi policy discount.

 

[bonesfab]

I have AAA for my other cars and home owners. All my shit is old so its actually reasonable home owners isnt bad.

 

[BUDMAN]

I’ve been saying it for years. “INSURANCE IS LEGALIZED CRIME!” The government says you have to have it and the insurance companies know it and charge you up the ass for it. Just don’t use it for a claim or they will drop you or increase your rates to recover their loss. I’m so insurance poor it’s not even funny.

 

[EmpirE231]

I’ve been saying it for years. “INSURANCE IS LEGALIZED CRIME!” The government says you have to have it and the insurance companies know it and charge you up the ass for it. Just don’t use it for a claim or they will drop you or increase your rates to recover their loss. I’m so insurance poor it’s not even funny.

Pay off your home and there is no law forcing you to carry insurance on it. Pay off your cars and you are only required by law to carry minimum state liability… which is still fairly cheap.

 

[BUDMAN]

Pay off your home and there is no law forcing you to carry insurance on it. Pay off your cars and you are only required by law to carry minimum state liability… which is still fairly cheap.

Great idea. I’ll send in a check to pay off the house & car tomorrow. What do I do about workers comp, general liability, my garage keepers, the boat and auto policies for work? However I like how you think.

 

[530RL]

Many carry minimum insurance. As a result those policies don’t cover a typical loss and your insurance has to pay the difference.

We are not paying for only our driving but for the driving of those who carry just the minimum and our insurance pays the difference.

In Arizona that is 15/30. 15 grand will not fix even the most minimum of damage to a newer vehicle.

 

[Wheeler]

Damn....baller tears are loud when they hit the ground.

You and your responses might be the only reason I participate at this dump.

 

[kevin1988]

Geico raised my rates $500 over 6 months on this last renewal. Shopped Allstate, State Farm, Connect by Costco. All said not writing polices in CA. Progressive gave a quote, came in $1200 more every 6 months than Geico.

Fiance and I on the policy. She has one at fault accident 2 years ago and I have a speeding ticket from a year ago. 21 f150 and a 18 ford fusion.

New 6 month premium is $2900

 

[NicPaus]

My commercial auto went up another thousand this last renewal. I price shopped and nobody will beat it. My personal auto went up a little.

My General liability went up 50% last 2 years in a row.

No claims ever on either. I started calculating and stopped at 2k a month on insurance. Not including the waverunner, golf carts or can am.

 

[OCMerrill]

Yes… all the sub 30 crowd do is use the phones while driving and crash into each other. I don’t think they for the most part are even car people it’s just a needed way to get from point a to b.

Used to be sub 24 year olds that mashed up cars. Now about all segments are bad.

Fines could go to a million bucks and stupid ass drivers would still text and hold the phone in their lap at every stoplight. Nearly have to honk at everyone to get them off the fucking light.

 

[OCMerrill]

My commercial auto went up another thousand this last renewal. I price shopped and nobody will beat it. My personal auto went up a little.

My General liability went up 50% last 2 years in a row.

No claims ever on either. I started calculating and stopped at 2k a month on insurance. Not including the waverunner, golf carts or can am.

My employees non-owned auto portion of my commercial auto policy tripled this last renewal. Never an issue.

 

[Mototrig]

75% of my client base called and advised they were working from home during Covid change it to pleasure usage and reduce the annual mileage.

3 years later not a single client has called back to update the usage and raise the price even though most people are back to commuting.

Car that was supposed to be driven 5k a year goes into body shop and has 35k more in a 2 year period. Company runs carfax for service records and can see they are averaging 15k a year.

Also people are flat out fraudulent about how much they drive as they have figured out it’s one of the biggest factors in the premium.

Another issue is the types of cars young drivers now have access to. Kids no longer drive 15+ year old shit boxes that just have liability. Lots of leases and most have payments so they need physical damage coverage.

I don't feel bad one bit if people are finding ways to reduce their insurance premiums. It's not like any insurance company has my best interest in their heart, they don't want to pay out on a claim anymore than I want to pay my full coverage premiums.

COVID hit and I kept working on site with the 70+ mile round trip to the refinery. The beauty of ride share vanpool and my wife working close to home means all 5 of my vehicles tic ridiculously low mileage per year. So ya, I'll take the discounted low milage premiums.

My 16 year old daughter is going for her license test this month in her car that is older than she is, and my son will be doing the same.

Sorry man, I have no sympathy for the insurance company's and their woes.

Edit: Sorry for shitting on anyone who works in insurance. Not my intention to offend anyone.

 

[LargeOrangeFont]

Just wait a minute here! Why are we listening to the insurance brokers in this thread? They don’t know anything about the insurance market or industry from the decades in their careers. They are just here to tell you anything to get your money and justify their higher profits!

Just like the Real Estate and mortgage brokers in the real estate threads that have spent their careers in the RE industry and we constantly and consistently dismiss their knowledge and experience in RE.

 

[HgH Vltg]

I can't see how some of these insurers are going to make it?

USAA is jacking rates 40-50% this year on people that have been with them for decades and not a single claim. WTF? Their customers are leaving in droves...

Greaaaattttt….I’ll have to double check my stuff. USAA has always been so affordable.

 

[monkeyswrench]

As 530 pointed out, the minimum requirements here in AZ won't really cover much. Even my cheap ass carries more.

Reading all these above, I'm very happy to not have employees, an expensive home in a flood or fire zone, and all my cars and toys are old shit boxes.

 

[NicPaus]

I was told commercial policy doesn't care about mileage per year. My 2015 work truck is about to hit 16k miles and my Plumbing van is driven less than 2k miles a year. And my $5k + commercial premium covers no tools. Only good thing about my commercial policy is you can pay for the year and save $800 compared to monthly.

 

[RitcheyRch]

Would also assume the insurance companies are losing money with all the catalytic converter thefts. Seeing they are $2-5K for the average car and taking 6+ months to get would be a huge cost to the insurance companies.

 

[Echo Lodge]

USAA jacked up my cost 50% this month by increasing the miles we drive each car by 5x over. They did it without being prompted by me. When I called yesterday the operator was nice enough to explain to me that USAA was doing this to customers who didn't update the milage for the renewal. She also explained that she's been fixing everyone's mileage all week when customers call.

I've missed the milage update a few times over the last 23 years but never have they so blatantly overcharged like this.

Thanks for explaining this. I did my mileage update recently. I don't ever remember having to do one. I thought I gave the milage when I first got a policy and that was it. Been with USAA for 30 plus years.

 

[was thatguy]

So reading this thread made me curious.
I went into my USAA home page and checked all my insurance data.
Zero increase, no change in stated mileage, no nothing.
I have 3 vehicles on there, including the corvette, all full coverage. I just added a homeowners policy as well.
My annual premium bundled is a FRACTION of the numbers you guys are throwing out.
I got a damn criminal speeding charge in CA in the Vette (106 mph) and USAA didn’t even flinch.
When I lived in CA Val was on our car insurance. It barely went up at all. When she moved out I tried to remove her and they said they automatically keep minors on the policy for a year or whatever it was. That’s when she was in that accident that killed her friends. She was a passenger. USAA paid her $100K unsolicited and without even a claim as an injured passenger in an underinsured crash.
My new homeowners policy is less annually then some of you guys stated dinner outings. On a brand new never lived in home in a brand new neighborhood.
USAA has never done a single negative thing as my primary insurer for over 20 years.
Is all this gloom and doom about CA only?
My shit is all AZ.

 

[J&k beer can]

It's a necessary evil..

Aren't they always in the 100's of million if not billion dollar profit every year?

 

[OldSchoolBoats]

So reading this thread made me curious.
I went into my USAA home page and checked all my insurance data.
Zero increase, no change in stated mileage, no nothing.
I have 3 vehicles on there, including the corvette, all full coverage. I just added a homeowners policy as well.
My annual premium bundled is a FRACTION of the numbers you guys are throwing out.
I got a damn criminal speeding charge in CA in the Vette (106 mph) and USAA didn’t even flinch.
When I lived in CA Val was on our car insurance. It barely went up at all. When she moved out I tried to remove her and they said they automatically keep minors on the policy for a year or whatever it was. That’s when she was in that accident that killed her friends. She was a passenger. USAA paid her $100K unsolicited and without even a claim as an injured passenger in an underinsured crash.
My new homeowners policy is less annually then some of you guys stated dinner outings. On a brand new never lived in home in a brand new neighborhood.
USAA has never done a single negative thing as my primary insurer for over 20 years.
Is all this gloom and doom about CA only?
My shit is all AZ.

Definitely seems to be a regional issue. If insurance companies are leaving California or choosing not to write certain policies in California, then that obviously creates a "supply and demand" issue that favors the insurance carriers.

 

[CarolynandBob]

In TN our auto insurance on a 21 Lexus NX is 1600/yr with 300/500 and 1K deductible. Boat is $369/yr yeah its a pontoon 2020, Polaris is 177'yr. Home owners is 1050/yr and we are in tornado alley. Boat and Polaris went down this year.

 

[JL95]

Man this thread is doomer as hell. I was pissed at a $80 premium increase on my homeowners this past month. Now i gotta get the hell out of CA before my children can drive

 

[TBulger]

Ye be warned! It’s going to get a lot worse in CA

but honestly though…. Look around and see how many accidents are happening on the daily. You run a resto company…. How many slab leak home claims are you seeing the in the 50-80k range. That one claim just wiped out 66 home polices with no claims. How many of your friends / family / people on this site have claims ? Just last week there was a thread about a pretty generous payout on a “totaled RZR” that only needed 5k worth of repairs.

I’m in the insurance biz… been here going on 23 years and I’ve never seen anything like it. Everyone likes to think that carriers are making so much money… in reality making 3 cents on the dollar is considered a profitable year. The last 2 years on average most carriers have been losing 15-20 cents on the every dollar they take in premium. Some way higher. Everyone wants their car “totaled out” or a kitchen remodel when something happens and they need to use their insurance. In CA the other party is always “injured” in a 2mph rear end collision. Body shops are taking 40 days for a average repair.

I’d say now more than ever there are more people driving around uninsured due to having no options or will not pay the crazy premium for a new policy. Almost all auto insurance carriers currently heavy restrictions (aka do not want new business). Home insurance has been fairly tight the last year or so and it just got worse. I cannot imagine how many deals will be falling out of escrow due to not being able to find someone to insure the property.

I wish it wasn’t like this… but the #’s don’t lie. I think culture has changed from people taking pride in having zero claims, to now thinking “well this is what I’m paying for” and the people with no claims get caught in the crossfire. A lot of people are always looking to “come up” when a claim arises these days. To my understanding State Farm has stopped new biz in socal, wawanessa and farmers both recently got approved for 40% + rate hikes, progressive 18% ,lots of carriers have 10-20 day holds on new business, some have just left the state. Most carriers that just received approval for rate hikes have already filed their next rate hike Etc etc. I can’t wait to get “good news” from the carriers, but I’m not holding my breath. rates are gonna get a whole lot higher before things level out.

Also the CA department of insurance is a huge cause of all of this. They did not review or approve any rate hikes for the last 2 years… which has caused the scenario we are in today. Rather than small gradual increases… we now have carriers needing so much rate… it’s causing them to shut down business in the state. Just incase you’re wondering… the CA insurance commissioner is a major lib as well, look for him to be running for governor soon.

Thank you.

 

[Shlbyntro]

Damn....baller tears are loud when they hit the ground.

The Replacements comes to mind

My insurance went up as well, Not enough to cry about but a noticeable amount none the less.

 

[monkeyswrench]

Man this thread is doomer as hell. I was pissed at a $80 premium increase on my homeowners this past month. Now i gotta get the hell out of CA before my children can drive

It also helps if your kids aren't ballers...
Just sayin'

 

[zhandfull]

Must have that senior discount

And no teenagers in the house.

My bill doubled when daughter received her drivers license. Premium is very close to yours with vehicle that are approaching 10years old.

 

[LargeOrangeFont]

Since moving out of CA my home and auto insurance bills were cut in half for the same coverages.

 

[MonkeyButt70]

Crazy reading this thread. My friend is an insurance agent and he was just telling me about these problems last week. From what I retained, most of these issues are cultivating from California. Many companies are not writing new policies and a minimum 7 day waiting period if they accept your business. He basically said hold on to your current policies and do not fuck up, things are about to get real ugly in the insurance business.

 

[JD D05]

I pay about 6k a year for home and 4 autos with one of them being a teenager that increases by about 2k a year. I also have an earthquake policy that's 600 a year.

 

[DrunkenSailor]

We are seeing massive increases in home owners premiums nationwide on our portfolios. Premiums are increasing by multiples in some markets. It's nuts.

 

[JD D05]

For anyone reading this with a business paying over a 100k a year in workers comp and or over a 100k a year in GL & autos you need to consider self funding with a captive. We saved a client 108k last year that owns a few grocery stores. Feel free to reach out to me if that sparks any interest.

 

[brgrcru]

Sub 35 year old caucasians are the worst. The entitlement is very very high.

Thank the parents

 

[monkeyswrench]

We are seeing massive increases in home owners premiums nationwide on our portfolios. Premiums are increasing by multiples in some markets. It's nuts.

With the extremely high housing costs, I could see this being a major issue. I know we had mentioned the cars being more costly to repair in a fender bender, but the cost of basic remodels skyrocketing, it has to effect home insurance as well. Then add in all the people who take advantage of the system...not good for those who don't.

 

[bk2drvr]

I’m moving to my river house permanently in 2 months. I just switched my auto insurance from Irvine to Mohave Valley, Az. When they told me my new premium I thought they had made a mistake. I have a 2021 Tesla and a 2018 GMC Sierra and the 6 month premium for both cars is $700. Or $49/month for the GMC and $67/month for the Tesla. I was paying triple that in CA. Your insurance premium is closely tied to your zip code. If you live in SoCal there is simply no way around high premiums. I agree with the OP, I don’t see how families are making ends meet these days.

 

[zhandfull]

Aaa has had a recent rate increase but are one of the few main line carriers that seem to be welcoming new business.

Auto rates have always been ok. Home rates have historically been lower than most.

Always had great service with AAA auto. So I stay even when I think I should be shopping.

 

[Racey]

I'll tell you right now Liberty Mutual can go fuck themselves.

The fucking worst most sneaky little fucks, They took my shop and business insurance and basically doubled it with no warning. They send the policy packet with no price, then about a month later send you the renewal, 14 days before it's due, so you are pigeon holed from shopping around. I told my agent they can shove it, he hunted around and found me better coverage for like 25% of the price from Sedgwick, Liberty wanted almost 8k a year up from 4k, and Sedgwick was less than 2k....

Plus their commercials are fucking annoying.

 

[King295]

Feel your pain here, but I've got a bunch of toys and I can't complain about that. Just yesterday my street legal golf cart insurance for CA jumped from $75 a year to $235. Agent said new CA requirements and due to influx of claims on these policies which isn't surprising in light of the people buying these things over the past few years.

 

[Sportin' Wood]

Damn....baller tears are loud when they hit the ground.

Thank you, that was awesome.

[Insert snarky remark here]
"Go Be Poor Somewhere Else"

The irony of a person who owns a business that primarily gets paid from insurance claims complaining about insurance costs is pure poetry.

 

[C-Ya]

Serious question……. Does Arizona have the same insurance problems that California and Florida currently have?

 

[GreenEnergy28]

Paying out about $9,000/yr in health insurance, $8,000/yr in home & auto insurance, $700/yr for self defense insurance.
I haven't had a claim since around 2010 when an uninsured motorist decided to drive through me while I was stopped at a red light on my street bike. I only claimed the bike damage and sucked up the physical damage. No broken bones so I said fuck it, I'll be fine.

 

[bk2drvr]

Serious question……. Does Arizona have the same insurance problems that California and Florida currently have?

Zip Code. Live in a small town pay little. Live in largely populated areas, hold on.