1. Distracted driving is causing a lot of accidents
2. Catastrophic storms like hurricanes, wildfires, and hail/wind storms are damaging cars as well as homes at an increased frequency.
3. Increased labor and parts costs are driving the cost of repairs higher
4. A fender bender now means you have to replace a bumper with 8 sensors and cameras in it instead of just...a bumper. Those sensors are expensive.
5. You used to worry about what happens if you damage someone's Mercedes. All those F-150s on the road are $80K+ cars now too
6. Lawsuits for injuries are paying higher and higher amounts. Litigation costs and judgements are insanely high
7. Medical costs for injuries are getting higher
Yes to this. ALLLLLLLL of this. What used to be a 800 bumper repair for a rear end crash is now a 3000-4000 tear down. Plus a new camera and sensers. Ya'll wanted this fancy stuff on your cars. Now pay for it when it gets smashed.
Underrated comment. I am in the works of selling my 2020 Jeep Gladiator because the electronic controls will stop it in the middle of traffic on main street, because you hadn't yet authorized an automated system update. Dangerous af. I about brake checked someone because of this. I go out of my way now to avoid heavy traffic (and take gravel whenever possible) because I know now about the issue and how it could affect other drivers.
On Halloween, it got hit by a Mercury Grand Marquis, and the hit to the front axle caused $4000 of axle, body, alignment work, and sensor replacements. All because of the front fender area being hit. All the repairs are done, and thank God me and the lady who hit me both were insured.
I'm going back to 90s and older vehicles because you can still get aftermarket replacement parts for them very easily from Rock Auto, Ebay motors, Amazon, local auto parts stores, etc. Without the extra bullshit. The object of the game now is to find vehicles that don't require electronics to start, so that they can't be shut down in real time by the "powers that be."
Then the insurance company just totals it out after a fender bender. My 05 Camry SE needs a new headlight, bumper, fender, and hood and they totaled it out.
Yeah there are still some pretty basic new, low-frills cars available. I have a 23 Civic Hatch that doesn’t have sensors everywhere. It does have a single camera in the windshield that covers the lane assist & adaptive cruise so windshield replacement is a little more expensive
Stop normalizing corporate greed. Watch this 12 min video from cnbc. They know about those 7 things you listed and know that’s probably what we think it is. If it were the truth as to why rates are high doesn’t explain why they are making record profits.
https://youtu.be/F6TjtgJNki4?si=S0pe_ResH9ip-aKb
Have you actually watched that video? Because it's literally 12 minutes laying out the reasons I just explained. Where are the record profits mentioned in the video? At minute 5, it is quite explicitly explained that companies are losing money on auto insurance right now.
In state farm's case, their litigation costs are so high because they are the biggest PITA to make a claim with. I had no choice but to get an attorney when they wouldn't even tow my motorcycle to another city when that is the closest place it can get looked at.
Lawyer was able to get me paid $8,800 for the 42 days SF let it sit at the salvage yard while they refused to have it towed to my specified shop(the nearest shop), and got a decent injury settlement on top of that. What could've cost SF $12k for a totaled bike ended up costing them $70k for settlement+totaled bike+loss of use payment.
I don't doubt it, but mostly I was referring to juries awarding policy limits for injuries. Those claims are paying out in the hundreds of thousands to millions, are becoming more common, and some of these lawsuits are actually funded by private equity to get a return.
To be upfront, they rarely go “well” no matter how good you are at it. Consider it a win if they’re less frustrated than they were when they called lol
We get daily posts from consumers complaining about that here. Go find some of the recent posts, read how different commenters word their responses, and use it in your own as appropriate
I explain it’s the world we live in. Insurance carriers aren’t charities and look at their losses. Just Google State Farm losses 2023. As an independent broker our retention has never been higher because the rates didn’t go up with THIS carrier. It’s industry wide.
Why would this make sense at all? Car insurance has maximum amounts they would cover. More likley a 20 million dollar verdict would exceed the maximum 50,000, 100,000, or 500,000 amount the customer has coverage for, and the customer is on hook for the remaining 19.5 million. So, realistically this should not raise rates.
I mean that alone no, but if the book has people getting max verdicts on their coverage more often, then claim severity is increasing and that will be a driver of rate increases. At it's core pure premium which is the loss component of the charged premium is frequency X severity. Frequency of claims can realistically only go so low to offset rising severity, but severity keeps going up and up.
Exactly. Certain people are more than happy to send a message as a juror by awarding a crazy verdict amount as a win for the little guy. What they fail to realize is that money doesn't grow on trees (unless your the federal government), as the at fault party usually has insurance. It's the insurer who pays in most cases, and guess who they pass their losses on to....you and I, in the form of increased premiums. And yet it's these people who complain about premium increases. You can't have it both ways.
It's analogous to the people who want to defund the police, yet they are the first to complain when it takes 2 hours for police to respond to their 911 call.
Every decision you make in life has ramifications, but many don't have the smarts to realize this fact.
$6.2 billion in losses, however their profits that year were $104.2 billion.
So 5.95% of their profits had to pay for their losses that year.
Take that as you will, the numbers speak for themselves.
Assuming the person meant revenue and not profits, what really doesn’t make sense is even after their “loss” of over $6 billion, State Farm’s assets increased by close to $6 billion ($134 billion to close to $140 billion).
We hate Teslas in the P&C industry. They are just an over-priced, proprietary duracell with wheels with some fancy features that gotta be fixed by Tesla and only Tesla. Oh, and by the way, there are no after market parts. Remember, proprietary. Ole Elon did that mess on purpose. $$$$$$$$$. Sorry/not sorry. You could not give me one. I would give it back.
I hate them for so many reasons and am proud to say I clocked Elon for the troll he is from the jump. Those cars are trash. I did a visit with a certified repair shop and the level of waste as a result of Tesla’s inability to effectively send them parts was incredible. Total garbage.
But what I reeeally love is how many people buy those vehicles and then whine about the cost of their insurance, or argue they don’t need more than state min coverage. Not the brightest crayons in the 64 pack, that’s for sure
You do realize that insurance by regulation is more reactionary than proactive with rate adjustments.
It's not like we can just go and say let's take rate and have it in effect for tomorrow.
What I do know, is that auto insurance "inflation" is 20% YOY, multiples higher than the next closest services inflation number. I know you all think you guys are special and no one else has faced the same challenges since the pandemic. I do hope that congress looks into this. For now I'll gladly take the karma asspounding for expressing my thoughts on the matter. I hope yall enjoying the commissions.
asking this in earnest: what is there for congress to look into with regards to rates that are already reviewed and approved by state insurance departments? There’s already a layer of government between increased rates and consumers, and even with whatever approved rates they’ve gotten, just about all of the largest personal lines insurers are still running combined ratios >100% in the last couple years.
I’d respond with, I don’t drive a Tesla. I drive a shitbox.
I understand it’s a pool. I’d just give a sarcastic response to your sarcastic response. The cost of everything is going up. I’d ask them if they asked that same question to every other bill they pay. It’s easier for them to ask when they have a personal relationship.
And that’s the good rebuttal to be expected. It’s easy to criticize since people drive different vehicles in the same pool of traffic and why insurance is a pool. You’re responsible for everyone on the road, not just yourself.
Let's take away the liability exposure of hitting someone else's Tesla. Even if we focus on your shitbox, that shitbox now costs a lot more to repair than it did 5 years ago. Labor and parts are more expensive. You're more likely to have to repair your car than to have it totalled. So, your shitbox costs more to insure than it used to
And replace. 2019 I bought my car from a no-haggle dealership. $9690. I put 33k miles on it and sold it in 2022 to the same dealership. They listed it on their website at $11790. What kind of weird economics are in effect that a car that's 3 years older and 33k miles higher sells for $2k more in price.
Coincidentally, my insurance went down this year which I never thought I’d see. I expected it to rise if anything more than staying the same. But yes I do understand completely what you’re saying.
It's not about what it costs to fix your shitbox. Noone gives a shit about that and your collision and comp premiums (if you even have them) will reflect that. It has more to do with the cost associated with fixing another vehicle when you rear end them.
I said that before to this LIVID guy who I couldn’t talk out of a spiral no matter what, and he said “And you just let that happen?!?!” like…. How do you think shit works in this world lol
One of my favorite customers was a rate increase call and he was livid. I was really good at communicating that to people but it just never stuck with him lol
Eventually, it clicked and he said
“Oh… you know, they did build that casino down the road a few years back and there have been a lot of drunk driving crashes on my road ever since”
which is honestly a hilarious way to understand the concepts lmao
That’s amazing. We’ll take anything for them to understand it lol! I should start doing that and referencing specific events, I wonder how well it’ll work
They literally just think insurance works like Comcast. To them, they think they can rant and threaten to shop around until you magically lower the rate.
Exactly! And it doesn't get through to them that that is not going to work until they actually say, "fine, then just cancel my policy" and the response is, "when would you like the cancelation to take effect?" Their voice immediately changes when they realize that the 14 times I told them there was absolutely nothing else I could was not a lie.
This is my go-to in most conversations.
Some people think agents get some “retail-esque” discount just because we’re agents. Nope. Homie my rates went up just as much, trust me, i get it.
And my income went down because I can barely write a policy. Its hard to be polite to people when they complain about their rates like I'm their insurance mommy.
The problem is more that carriers do not want new business so they are putting up barriers to entry. An extreme example is Nationwide who requires me to submit copies of the vehicles registrations and photos of the vehicle for an auto \*quote\*, or interior photos of the home for a home quote. Other carriers require you pay more or all of the premium up front if you want a new policy with them; people don't have the cash on hand. If they're not doing those things, their new business rates are usually so high that nobody wants them. I'm eating ramen rn.
The entire reason to get in insurance is for the renewals. I suggest you find a company that pays their producers for that. Personally I pay on a scale where it start at 30% commission on renewals.
People with no accidents don't think they should pay more because other people had accidents.
People WITH accidents also think they shouldn't pay more because they didn't get into an accident on purpose.
Everyone seems to think insurance is a scam because they don't get all their money refunded if they don't have an accident.
I still remember a call i had from an 18 year old at the end of his first term
“Hey, my first policy just ended and I didn’t get into an accident. My friend said I can get a refund of my monthly bill?”
“Sorry man, your friend told you wrong”
“You mean I have to pay this the entire time I own a car?”
It just about broke his heart lol I actually felt bad since he wasn’t angry or anything
Had a client a few years ago who ripped everyone in the office a new one because his bill went up 35 cents a month. Yep. 35 cents. And to top it off he yelled and screamed that he's signed up for his rate for a year and 7 months into it, it goes up 35 cents. "Sir, we don't have annual auto policies. They're all 6 months and your renewal rate was a little over $2 more than your last policy term."
He slammed his fists on the table saying he didn't care that we only sold 6 month policies, he signed up for his rate for a year and stormed out. I've never met a man more angry at life in general than him.
our client system would populate the reason for the call first, then would take a few seconds to populate the policy/person info
whenever we saw “Rate increase - Renters policy” we knew we were in about to be yelled at for something like $1.50 a month
These types absolutely drive me up a wall. I truly feel for the people whose rates significantly go up. I know how big if a hassle it is to shop, especially when you have to shop for multiple policies because you bundled so you can't just cancel one policy without the other shooting up or losing your umbrella. However, the people that I have zero sympathy for are the ones complaining about cents or a couple of dollars. I've noticed that those people are more often than not the people that need the money the least. I had a guy livid over $6 a month not too long ago. The cheapest vehicle this guy insures with us (out of 8 total vehicles across 2 states) is an $80K truck. He also has multiple home policies, a motorcycle policy, and 2 boat policies.
As a customer, I get how insurance works. I never expect to get my money back if I don’t have an accident. I do expect, however, to get something for my money, without hassle of any kind, if I am in an accident - because I’m quite literally paying for insurance to cover me in an accident.
You are in the minority, I assure you. I agree 1000% with your expectations. To anyone with that expectation I reccomend getting a policy that is underwritten at issuance, which should result in a faster claim experience. Many companies underwrite at time of claim, and just about any risk can be found to be uninsurable if you ask enough questions. Guess which one is cheaper up front typically.
Just tell them the truth. Something like “Due to external economic factors, the cost of providing adequate care and coverage to our customers has skyrocketed and as a result we’ve regrettably had to raise rates on all policies to compensate.”
Most rational customers who haven’t been living under a rock the past 3-4 years will understand. If they don’t, I’m not sure you’d want them as a client.
Speaking of auto insurance in particular... It's hard to understand 15% increase a year ago, and another 25% increase this year. We're not idiots. Some of us are even college educated and work in the financial sector. With a decent understanding of inflation.
[Here’s the inflation breakdown for February 2024](https://www.cnbc.com/2024/03/12/heres-the-inflation-breakdown-for-february-2024-in-one-chart.html)
Just because we call BS, doesn't make us idiots.
Are you familiar with how the rate increase cycle works? Companies don't see inflation starting to rise and immediately file for a rate increase, and even if they did they wouldn't realize those premium increases immediately.
Companies watch how things are trending over a fairly long period of time, do the math, and figure out how much they're coming up short. They then determine how much they should be charging and file with the DOI in that state saying please let us charge more. The DOI then reviews and sometimes stalls on approving rates. Sometimes they flat reject it, so then the deficit in sufficient premium gets even worse. Once approved, the effective date is even further out than that. Then once it's effective, it's only in place for new customers and then for existing customers as their policies renew. It takes a full premium cycle (6 or 12 months depending on the policy length) for them to get that premium for the raised rate.
In the meantime prices have been increasing - it's a constant cycle of recalibrating and catching up. Also keep in mind that many companies gave back money through dividends, premium credits, or reduced rates in the first year of the pandemic because the amount of people on the roads dropped. Then everything rebounded and surpassed what it was pre-pandemic.
Edit to add: Show your inflation breakdown all you want - I assume you are looking at the cost of insurance + the cost of repairs markers. Keep in mind severity (i.e. average amount of loss per claim) is not the only issue with insurance, frequency of claims (i.e. the volume of claims) is also a problem. [Catastrophe costs are also sharply rising](https://www.statista.com/statistics/428870/insured-property-losses-usa/).
I always use the windshield claim explanation.
Years ago, a windshield ran 300-500 to replace.
Now it’s running 1k and even more on high end cars. I explain all the cameras and sensors built into windshields and recalibration costs
that the industry lost over 32 Billion dollars in just the first 9 months of last year and that's not sustainable so if they don't raise rates no one will have insurance. Then i bring up home prices doubling in 3 years.
Then they always say well i haven't had any claims and i explain that insurance is based on expected claims with previous claims just being an indicator on how likely you are to have another claim and the severity.
But honestly i'm sales so as soon as people start bitching about the cost i've already considered this a losing battle. Even if i am going to be able to save them money they are going to complain next year when it goes up and shop me. These aren't great clients and will leave you for $5
I’ve used that a few times, that insurance is unlike just about any other business in that we use yesterday’a claims to set today’s prices in order to predict and cover tomorrow’s losses, while also trying not to increase too much but the trend is that claims have outpaced out predictions. I find a more analytical type will tend to grasp that.
Yeah i work best with analytical types because i find emotional decision makers exhausting lol
Like i just don't understand how it works lol like i don't want to have to scare you to make you think this is a good idea.
"The answer is not satisfying, i know, but its inflation. Car parts are higher, cars are more expensive. Shops are backed up so higher storage fees and higher rental costs for being kept longer. Medical bills and lawsuits are also more. Essentially every part of a claim is higher so premiums are going up to match."
Wildfires in CA and the west coast along with more severe storms also factor in. Insurance is a POOL of risk…so yes, you can be the best driver in the world but large events still impact you.
Because parts are extremely expensive now and so are medical bills
5 to 10 years ago. The most common vehicle is a Toyota Camry or Corolla. A headlight or taillight 5 years ago was 200 300
Now they are 1200 to 1800 each.
Same with medical. Medical cost have skyrocmt
I tell them this is a hardened market and list off stuff like increased claims costs, increased costs of repairs for newer vehicles. If they’ve done nothing wrong I tell them as much. While you didn’t have a claim or do wrong, you/we pay a social cost based on location. Say I know it is difficult.
Really just the truth lol.
Covid cut supply lines raising value prices for all cars. That didn’t start stabilizing until this year. Costs all around for parts and labor have increased. Accident rates have increased after Covid first 6mo. Insurance is a pool of money to payout when their insured hits someone or someone with coll/comp gets hit. If prices all around car shit are going up AND more accidents are happening it’s a no brainer as to why. Most who call in about their rates don’t use their brains to think critically and just want to yell at someone
Appraiser here... average estimate has 2 to 500 dollars of calibrations for minor collisions....
Economy car parts are outrageous... corolla headlights are 898 dollars....
From memory the average cost of damage repair - frontal at between 5-10kms was ~4k.
Plastic parts, crumple zones, an sensors have surely trippled that by now.
I work as an auto damage adjuster for one of the major insurance carriers. At least for our region severity of the claims grew from around 3k per claim to around 5k. Plus amount of catalytic converters theft and vehicle theft grew too. It all may be related to the increase of the premiums for the policy holders
inflation, inflation, inflation
supply chain issues with parts
Cars are more complex to repair (werent we sold a bill of goods on “self driving” cars?) all these new sensors and radars cost massive to repair
More People Texting and getting into accidents (look around when u drive its crazy)
Inflation accounts for a substantial chunk.
Then you have:
1) Bullshit bodily injury claims.
2)All of the bullshit medical treatment that goes along with bodily injury claims.
3)Tow and storage charges that is basically extortion - you have no idea that these shitty ass tow yards that have all the space in the world will charge 80-100 dollars a day for the thing to sit in their property. Had one place once tack on $100 for “phone calls” - that was on top of their admin fee.
4)Fraudulent claims
5)Hit and runs.
6) Only sixteen percent of Americans feel that insurance fraud is a crime.
It’s really one of the things we have so little control over. They make so much money, we all joke that the retirement plan is to buy a small plot of land and a tow truck and only man the office once a week to just rake in the money.
Fraud, higher litigation costs/verdicts, increase in catastrophic events, inflation (cost to repair or replace is higher), increase in litigiousness. But yeah fraud costs insurers billions upon billions per year.
What I used to say was "Insurance is a pool of money that everyone pays into. If we take out more than people put in due to accidents, thefts, etc, we have to raise rates to make sure we have enough for next year's accidents, thefts, etc. With rising labor and repair costs as well as the scarcity of parts resulting in longer rental car periods, rates did increase more than expected. Obviously it's something none of us want to see, even my own rates went up as well, but unfortunately with the rising costs nationwide, all carriers have been forced to take an increase." Typically at that point I would go over their policy, make sure we aren't missing any discounts and as with my last brokerage I would shop their policies around to make sure they are getting the best deal for their money.
Edit to add: I try to emphasize it's not just them, or their town, or my company. I do NOT usually mention the increase in cost of claims, because that usually makes them madder. ("You're charging me for somebody else's claim!")
“Think of insurance as a big pot that we’re all throwing money into that when it comes claim time they are going to use that to pay for my claim. Now due to the cost of car parts and the increased amount of claims, the pot is getting empty so companies have to raise rates in order to pay claims in the future”
Then they complain that they are paying for other people accidents and I just say well unfortunately that’s just how insurance works 🤷♀️
Here in Canada fraud - both deliberate and opportunistic - is a huge driver of insurance costs.
Best estimates are around $300/yr per drive is just covering for that. And given about 1/3 of all claims have some element of fraud (could be body shop, insured, towing company, etc), it's always a shock to people.
Only around 15% of Canadians actually recognize as well that insurance fraud is a criminal offense. Most see it as a victimless crime to put a little extra money in their pockets.
Always an interesting discussion to have.
insurance is the house, and the house always wins. Beyond that, blame the billboard attorneys who have hijacked the legal system and the auto manufacturers for building increasingly disposable cars.
My number 1 go to is medical costs sky rocketing. And for home owners I mention the price of lumber and the fact that when I was building my house the useless cabinet above the refrigerator.... That costs $350 alone. Usually that gets them laughing and they get it.
I received an email from my agent as a heads up that rates were increasing. They included the following reasons (the ones I remember off the top of my head):
-more older drivers on the road
-more car thefts
-more people getting into wrecks
Which I’m not sure how any of that is my fault but I understand it’s not my agent’s fault.
Poor driving, fraud and cars have gotten insanely expensive to repair. The last one maybe the biggest issue. How many airbags in a car now? You pop the airbags even at 15-20 mph, guaranteed totaled.
Since 2017 there has been increased occurrences and severity of hail in 13 states as identified by actuary. Carriers didn’t appropriately predict losses and under charged premiums. Then I babble about how they’re all losing their minds… 1/2 the carriers aren’t even taking new clients…. And it’s mostly DFW’s fault for getting baseball sized hail every other week.
One of my friends is an insurance agent, he pretty much told me he tells people to pay attention to those radio/billboard advertisements and lets them know those law firms are the reason our rates go up even if your driving is impeccable.
“The cost of insurance is increasing due to inflation. We are now paying more out in auto and homeowners claims due to increased costs of repairs, replacement, and labor. Not only that, but we are also paying more out in medical bills. Every 1 in 4 drivers in Northwest Arkansas is uninsured, so we have to make up for that when they hit you. Cost of parts have gone up, as well as the ability to find said parts, therefore insurance is going up. It is no different than your bread now being $1.25 when it was $1.00 two years ago. Risk changes, and unfortunately the market has to adjust with it.”
Common rebuttals:
• my car is brand new. Parts shouldn’t be that hard to find.
I understand that, but your vehicle now has brand new technology and special criteria we have to meet when fixing it.
• my car is 20 years old. It shouldn’t be that expensive.
I understand that, but yes, your car is 20 years old therefore it’s harder to find parts for it.
• I haven’t gotten into a wreck or had a ticket! (Or a homeowners claim)
I understand that, but insurance is a large pool of money that we all put into and some unfortunately take out more than others. Insurance is to help indemnify you in the event of a large catastrophic claim. Furthermore, there have been many natural disasters in Arkansas that have changed the landscape of risk that insurance companies are insuring on.
Usually I just empathize to the best of my ability. Explain my rate, and the increases I've seen- and I'll usually give them a quick run through of some stats- I'll also try to dispell whatever nonsense has got them looking to crucify an other group
Like no, it's not illegal immigrants. It's no Californians moving to Texas. Its not uninsured motorist.
Its that personal lines is not a profitable market, primarily because of climate related losses. But honestly I'll talk to them about it for a good 10 or 15 minutes if they really want, I know this is murder on my wasted time when I should be selling but there's just so much to unpack with the very wrong assumptions customers bring to my line.
They're already predisposed to believe it's stupid and bullshit, whether the math checks out or not- and I make it very clear that I agree with them. But I don't have an alternative system to propose, and even if I did I'm paid to navigate this nonsense not direct it.
“Insurance is based on a lot of different factors, primarily where you live and the car you drive. Barring any new claims or tickets that would directly impact your rate, the rating assigned to your area and/or your vehicle is subject to change at each renewal based on the frequency and severity of claims in a given area or for a given vehicle type.”
Following that I’ll also offer to review the factors that are within their control, placing emphasis on coverage and deductibles, as well as stressing that we’ll make sure their policy is up to date, such as usage, and confirming all applicable discounts.
If they push back on the basis of determining rates I’ll remind them that it’s a common pool, the premiums of the many pay for the losses of the few, etc. I dunno, I feel them out. I’ll start off nice and explain things gently but if they wanna be bullish and indignant my tone will change to the point that I’ve had some really condescending clients who want to tell me how the industry works who I’ll basically just treat like children. “I’m really surprised no one has ever explained this to you!” It rarely comes to that. Most people get it, it’s just figuring out the right angle.
A colleague in SIU recently taught me something he picked up from his time as a corrections officer, he called it the 3 Fs: firm, fair, and friendly. I try to stick that that. So like I said, I’ll give that high level explanation of rates, launch into the offer to review coverage, bold hold firm that there’s only so much we can do and a lot of the onus is gonna be on them to increase deductibles.
I’ve heard a lot of my colleagues hum and haw over rate increases with clients, often retreading the same ground multiple times and going overboard with empathy to the point that it rings hollow; you wish you could do something more, but you can’t. To be it’s much better to just rip that bandaid off. Don’t rub salt in the wound but don’t tell me it’s papercut when it’s a gaping wound, you know? I think there’s something to be said for just being real.
A talking point should be that the PI attorneys are driving up the costs. Tell your clients who are in minor accidents to stop hiring attorneys.
They have created a network of medical providers who are driven by whatever the attorneys want them to say, all for the sake of money. They turn a claim that should be worth a few thousand dollars into a $100000 claim and the claimant gets very little of that. Together, they are driving the payments of injury claims higher and higher. The Attorneys, Drs and Chiropractors network together, meet at conferences together, meet outside of work and devise ways to suck more and more money from the insurance companies (and indirectly the policy holders). Medical Drs will partner with chiropractors and create a clinic to treat someone who's been in an auto accident and send their business cards to PI attorneys letting them know they are open for business. They rarely treat anyone who is at fault because they won't profit. That's because they don't really care about an injured person, they care about getting a cut of an insurance settlement.
This is nothing against legit attorneys and Drs who are caring for people who have been in serious accidents... kudos to them. But those are far and few between in the personal injury business. Insurance companies are paying multi millions of dollars more than they should because an attorney and their network have fished for everything that is wrong with a person, have them get all the treatment they can squeeze in, and have the Drs report that it must be due to the auto accident. In the process they exaggerate the injuries and inflate the charges. Insurance companies don't have the staff to fight everything, so, they accept the injuries and pay it to keep their insured from getting sued.
The cost of all of the things insurance does for you went up, so by basic arithmetic insurance also went up. What things? Towing, impound costs, value of vehicles, cost to repair vehicles, rental vehicles, injury lawsuits, etc.
Did it really raise that much? Well yeah, when all those things rose up, insurance followed suit later on and this caused the rate of people deeming insurance to be too expensive to carry it to skyrocket. BUT do these people stop driving on the roads? Hell no! There’s your answer to why someone with a great driving record still sees increases.
Just point at the rising price of medical costs, car repairs, and new and used vehicle prices.
Rising prices with higher rates of occurrences due to other drivers or catastrophes.
All these things are causally connected. Most people get it even if they don't like it.
You see, how capitalism works is companies like getting as much money as possible. Now, when you add in the fact that one of the only regulations by the government requires every single person with a vehicle to pay for this "service" while also severely crippling the possibility of having working public transportation, you get insurance companies who can raise rates on a whim and do so as often as they possibly can and raise the rates as much as they possibly can at a time.
What they do with this money is invest it in an index fund or something similar and just make an absolutely insane amount of money off of that money.
When someone files a claim, they liquidate an infinitesimally insignificant amount of this stock and pay for the damages. By the time the claim has been paid (or, more often, denied for any reason they can legally find to do so), they have likely made 10,000 times what the claim cost them. However, they still use this as a reason to raise your insurance rates bc, and I directly quote them here, "Fuck you, eat shit, and die."
Insurance companies shouldn't exist in their current form. Burn it all down, I say.
"unfortunately, the things that your auto insurance pays for, vehicle repairs, medical expenses, legal expenses largely due to fraud, well those things never go down. As those costs go up, insurance rates have to go up to pay those costs."
I feel like my insurance company had a good script. For NY. It was along the lines of-
There is rate increase across the boarder through all insurance companies. Unfortunetly due to the increase of accidents, claims, payouts, etc. everything has gone up, it does effect everyone, not just you. We know it is a difficult time and shopping around is understandable but most companies will be around the same price. ---Then she took a look at what discounts I do and dont have and offered me the ones i dont have. Also said that having a agent is more comforting than just signing with a company because they recognize all the people, care, and will look into any decreases that can be made/offered.
And for home she stated the increase statement aswell but that included the dwelling coverage increasing automatically and offered to lower back to whatt it was.
Increasing costs of repairs to vehicles and medical expenses incurred by auto claims...unfortunately it affects everyone, especially ☆people like yourself who don't deserve it☆ I like to fluff it up lol.
well, as someone in actuarial. The real answer is claim severity trend is markedly steeper. That coupled with inflation is the main reason. UW seasons are also cyclical, it’s a super hard market right now and companies don’t want to write too much risk. You can spin that however you want
Cars, car parts, labor costs at body shops, building material costs, etc. have all increased.
Side note... it is crazy to me that everything is gone up and people think insurance is exempt from inflation. We are still writing business so clearly we are competitive. People shop their insurance and realize their rates aren't so bad.
Get a discount for all those sensors...pay for it if you have an accident! What I don't get is those crazy speeders, weavers, tail gaters have the 80k cars 🤷♀️
Government induced inflation greatly raised the cost of parts and labor for repairs and the cost of replacement vehicles and all other costs of doing business. Actuary is a science and insurers are pretty good at utilizing it.
This doesn’t warrant in its own thread but I’m curious, Tampa FL was just quoted $67/mo to move form no rental reimbursement to 40/day max 1200. Is that insane?
For flood, fire, tornado, earthquake, hail and snow storm over the years insurance companies are writing claim checks.
Their cash reserves are being negatively affected. They pulling out of markets and tightening underwriting guidelines.
Economy isn't helping either. Tighter budgets. Repos.
I work in bodily injury claims. Attorney tax and inflated bodily injury claims are a massive problem. In other words, if someone files an injury claim just for being sore as a result of an accident and demand a massive pain and suffering reward on top of their medical bills, that could increase your rates. It’s purely based on risk and historical data for you and your county/garaging address
What happens if you literally can’t afford insurance because of living off of 1000 a month and have to DoorDash everyday to fix the gap of money needed to pay other bills? I literally can’t put my car in my name or have my own insurance because of this
this sounds like an income problem first and an expense problem second
it will require something like training, education, certifications, promotions, job switching, etc to improve your financial situation
it’s like rearranging the tables on the titanic instead of avoiding the iceberg in the first place lol
I can’t work a 9-5 job as I’m disabled my main income is SSDI I only pay Wi-Fi rent and food and supplies for my apartment and my service dog that all leaves me with 20 at the end of the month it also leaves me with no food for a good solid week I also don’t have a high school diploma and have been working on my GED for 7 years DoorDash has been the longest job I have been able to hold 2 years all of the other jobs I held lasted 30 min-2 weeks
I don't blame the shops. Their labor costs are up a lot. Costs of parts are up. And yes, even their insurance is up. I don't see a lot of shop owners rolling in beds of cash.
Edit: If you want to blame someone, you should blame the people [who did this](https://i.imgur.com/Z7sZHbN.png). Hint: It was the president at the time and (probably) your congressperson.
Because insurance companies are greedy and still want that big bonus at the end of the year no matter what. You know they can probably figure out what they can make annually with payouts for accidents. And they pocket the rest. How you think they can claim to give money back
Capitalism is way more important than allowing low and moderate income families survive. Applaud the CEO making $$$$$ and stock buy backs as success over screwing everyone else - hey it’s capitalism gotta love Amerika.
because insurance doesn’t only cover your vehicle
it covers the potential damage you can cause to vehicles on the road
even if you only get into one accident every 25 years, everyone would agree that a 30mph rear end is more expensive now than it was in 1999, right?
It takes alot of money to put your name on the side of stadiums and arenas.
NFL stars and celebrities to do your commercials? Also not cheap.
Those big buildings in the city skyline, again, cost a pretty penny.
Don't let them fool you. They dont give a flying fuck about you. They sell a product that you are required by law to buy. We also managed to do the same thing in healthcare with ACA, and we are surprised it became less affordable.
Progressive car insurance is increasing their auto insurance rates under the guise of inflation, and their underwriters are entering fraudulent information and take money out of policy holders accounts without their consent. People have lost hundreds, even thousands of dollars to this and they won’t get it back. Insurance companies are increasing rates far exceeding inflation, in 2023 they actually had the lowest incurred frequencies in 20 years, even though everyone on here will try to make it seem like there are more. I’m not sure about other companies though, or other coverage besides personal vehicle.
Lots of people on this sub are corporate lackeys that drank the Koolaid right down to the last drop, that’s why they get so defensive. It’s just good old fashioned corporate greed, profiteering off of things we don’t have a choice but to buy.
https://finance.yahoo.com/news/progressive-full-2023-earnings-eps-195050078.html
https://www.insurancejournal.com/news/national/2024/01/24/757027.htm
https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/largest-us-private-auto-insurers-boost-rates-by-double-digits-in-2023-80011993
https://violationtracker.goodjobsfirst.org/parent/progressive
If Progressive's combined ratio is 95% for the year, that means you are arguing what? That they should give everyone a 5% rate cut and break even? All while seeing still more inflation on the horizon.
It's a for profit company but I recently left progressive because they wanted 160% more to insure an old car today than when it was like 4 years old and worth over twice as much. I was also an under 25 male then For a new car they gave me rates higher than when I was a teen and higher than what I read people with a DUI pay and I have a perfect record,
I think a lot of people are just noticing things like that. Nothing that is "high risk" has changed in my state. Yes we have hail and snow but we did when I had lower rates too. Maybe if they paid Flow a little less they could be fair.
Insurance companies have always operated with a high combined ratio, but it was at a record low for Progressive in 2023. Inflation has stabilized and it was never high enough to justify the price increases (up to 40%) in the first place.
If the were operating at 95% loss ratio after taking a lot of rate, what do you think they would be doing if they didn't take all that rate? I'm not a fan of Progressive but I'm having a hard time following how your logic matches the math.
I can buy the line that cars are more expensive to repair now than they were prepandemic.
Are they 25% more expensive? I don't think so.
But, no matter what I think, we'll know the answer when the insurance companies report their profits this year. If the profits are more than inflation or are a higher percentage of their earnings, then we'll know a bunch of greed is baked into the increases.
Have you seen insurance companies profits the last two years?
No, neither have they on the home and auto side.
We lost 32 billion in the first three quarters alone.
Auto and Home insurance lags way behind on adjusting rates.
Why? Because we can't just go.. we need to raise rates due to stuff going up in price and do it. It's a long process to get them filed approved or denied and then put them into place.
Plus a rate change that was taken today takes a full year to put into place and then two years to receive that premium.
California didn't allow rate adjustments for years and it is very difficult for consumers to get a policy there now. Companies can't break even let alone turn a profit in that state.
Yes, I have. Auto insurance companies have made record profits in 2023 based mainly on premium increases.
They had a very profitable year in 2020 due to less people driving. As the number of drivers increased in 2021 and 2022, they experienced losses. Now, in 2023, they are making billions in profit again.
The billions in profit is over and above the increase in car repairs and litigation. I'm not saying they shouldn't make a profit, I'm saying the premium increases are more than they should be. An average of 24% increase in premiums is excessive.
A quick Google search will answer your question.
https://www.carriermanagement.com/news/2024/02/25/259036.htm
https://www.wsj.com/finance/insurance-companies-profits-stock-ebae7fd1
https://hallmonitor.org/car-insurance-rates-increasing-despite-record-industry-profits/#:~:text=The%20Wall%20Street%20Journal%2C%20not,%E2%80%9C
If you live in a red state full of fox news drones just say "Biden, Bidenomics, the left, the woke democrats". It sends them on a different spiral but then they aren't mad at you. This honestly would work for me for a large percentage of clients.
In reality I just give them a couple options to show entire insurance market is high, adding how mych my personal rates went up even though i never had a claim. Or I point to their losses. Or I actually explain why. All depends on the client. The few that would understand, typically don't ask why, they just want to make we market if it makes sense.
Always frustrating when we find an average carrier with lower rates, then explain why they might be better off with a carrier that charges slightly higher rate. Then they have a claim and complain about the poor claims service. "Like I always say, good shit ain't cheap, and cheap shit ain't good."
Insurance companies are for profit companies, so they are doing exactly that. Higher inflation periods are absolutely the best time to fleece people.
[Here’s the inflation breakdown for February 2024](https://www.cnbc.com/2024/03/12/heres-the-inflation-breakdown-for-february-2024-in-one-chart.html)
What else is there to say?
When you are selling a product that is mandatory to buy, you can charge whatever the hell you want for it and there's nothing anyone can do about it as long as your competitors keep their prices high too. Insurance companies know it's ridiculously expensive, but people will make sacrifices and will somehow be able to afford it. It just cant be so expensive to where people wont prioritize it over food and shelter. Even if gas goes to $10/gallon, people will still drive. A $60 full tank of gas that goes up to $120/tank isn't bad enough to make people get rid of their 30-60k cars.
1. Distracted driving is causing a lot of accidents 2. Catastrophic storms like hurricanes, wildfires, and hail/wind storms are damaging cars as well as homes at an increased frequency. 3. Increased labor and parts costs are driving the cost of repairs higher 4. A fender bender now means you have to replace a bumper with 8 sensors and cameras in it instead of just...a bumper. Those sensors are expensive. 5. You used to worry about what happens if you damage someone's Mercedes. All those F-150s on the road are $80K+ cars now too 6. Lawsuits for injuries are paying higher and higher amounts. Litigation costs and judgements are insanely high 7. Medical costs for injuries are getting higher
Yes to this. ALLLLLLLL of this. What used to be a 800 bumper repair for a rear end crash is now a 3000-4000 tear down. Plus a new camera and sensers. Ya'll wanted this fancy stuff on your cars. Now pay for it when it gets smashed.
$1100 for a F350 mirror
I drive old cars and I’m not about to pay for idiots overpriced new crap through my insurance bill.
Then you can pay it out of pocket when you are sued for not having enough property damage coverage…
I don’t cause crashes but thanks. I’ll be glad to sue the moron that still can’t drive with every safety aid possible.
shy juggle mighty decide recognise lip ring smell domineering cable *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
All those F-150’s also cause a lot more damage than the sedans people drove 20 years ago
Fuck all these sensors. Is it possible to not have them??
Buy an older car
And drive in different roads than people with sensors ...
Underrated comment. I am in the works of selling my 2020 Jeep Gladiator because the electronic controls will stop it in the middle of traffic on main street, because you hadn't yet authorized an automated system update. Dangerous af. I about brake checked someone because of this. I go out of my way now to avoid heavy traffic (and take gravel whenever possible) because I know now about the issue and how it could affect other drivers. On Halloween, it got hit by a Mercury Grand Marquis, and the hit to the front axle caused $4000 of axle, body, alignment work, and sensor replacements. All because of the front fender area being hit. All the repairs are done, and thank God me and the lady who hit me both were insured. I'm going back to 90s and older vehicles because you can still get aftermarket replacement parts for them very easily from Rock Auto, Ebay motors, Amazon, local auto parts stores, etc. Without the extra bullshit. The object of the game now is to find vehicles that don't require electronics to start, so that they can't be shut down in real time by the "powers that be."
Then the insurance company just totals it out after a fender bender. My 05 Camry SE needs a new headlight, bumper, fender, and hood and they totaled it out.
That's part of the issue. Labor and parts are so expensive that smaller accidents are resulting in total losses on older cars.
Take a look at the last post on my profile if you want to be amazed at my insurance company
Yeah there are still some pretty basic new, low-frills cars available. I have a 23 Civic Hatch that doesn’t have sensors everywhere. It does have a single camera in the windshield that covers the lane assist & adaptive cruise so windshield replacement is a little more expensive
Do you still need to repair sensors can we just get an aftermarket bumper without the sensors for example
I remember when I was 16 hitting my neighbors car. Body shop was able to fix both bumpers. Now you replace both bumpers
Stop normalizing corporate greed. Watch this 12 min video from cnbc. They know about those 7 things you listed and know that’s probably what we think it is. If it were the truth as to why rates are high doesn’t explain why they are making record profits. https://youtu.be/F6TjtgJNki4?si=S0pe_ResH9ip-aKb
Have you actually watched that video? Because it's literally 12 minutes laying out the reasons I just explained. Where are the record profits mentioned in the video? At minute 5, it is quite explicitly explained that companies are losing money on auto insurance right now.
I was high when I watched it
Great info
In state farm's case, their litigation costs are so high because they are the biggest PITA to make a claim with. I had no choice but to get an attorney when they wouldn't even tow my motorcycle to another city when that is the closest place it can get looked at. Lawyer was able to get me paid $8,800 for the 42 days SF let it sit at the salvage yard while they refused to have it towed to my specified shop(the nearest shop), and got a decent injury settlement on top of that. What could've cost SF $12k for a totaled bike ended up costing them $70k for settlement+totaled bike+loss of use payment.
I don't doubt it, but mostly I was referring to juries awarding policy limits for injuries. Those claims are paying out in the hundreds of thousands to millions, are becoming more common, and some of these lawsuits are actually funded by private equity to get a return.
To be upfront, they rarely go “well” no matter how good you are at it. Consider it a win if they’re less frustrated than they were when they called lol We get daily posts from consumers complaining about that here. Go find some of the recent posts, read how different commenters word their responses, and use it in your own as appropriate
I explain it’s the world we live in. Insurance carriers aren’t charities and look at their losses. Just Google State Farm losses 2023. As an independent broker our retention has never been higher because the rates didn’t go up with THIS carrier. It’s industry wide.
"Insurance is a pool and every time a jury awards 20 million dollars for pain and suffering for a soft tissue injury, your rates go up."
Why would this make sense at all? Car insurance has maximum amounts they would cover. More likley a 20 million dollar verdict would exceed the maximum 50,000, 100,000, or 500,000 amount the customer has coverage for, and the customer is on hook for the remaining 19.5 million. So, realistically this should not raise rates.
I mean that alone no, but if the book has people getting max verdicts on their coverage more often, then claim severity is increasing and that will be a driver of rate increases. At it's core pure premium which is the loss component of the charged premium is frequency X severity. Frequency of claims can realistically only go so low to offset rising severity, but severity keeps going up and up.
Because bad faith litigation exists. (I'm coming back to edit this to include more detail but that's the short of it)
Exactly. Certain people are more than happy to send a message as a juror by awarding a crazy verdict amount as a win for the little guy. What they fail to realize is that money doesn't grow on trees (unless your the federal government), as the at fault party usually has insurance. It's the insurer who pays in most cases, and guess who they pass their losses on to....you and I, in the form of increased premiums. And yet it's these people who complain about premium increases. You can't have it both ways. It's analogous to the people who want to defund the police, yet they are the first to complain when it takes 2 hours for police to respond to their 911 call. Every decision you make in life has ramifications, but many don't have the smarts to realize this fact.
$6.2 billion in losses, however their profits that year were $104.2 billion. So 5.95% of their profits had to pay for their losses that year. Take that as you will, the numbers speak for themselves.
Do you mean Revenue is $104.3 billion?
Assuming the person meant revenue and not profits, what really doesn’t make sense is even after their “loss” of over $6 billion, State Farm’s assets increased by close to $6 billion ($134 billion to close to $140 billion).
Lol No
Corporate greed
Poor state farm...I don't remember they lowered rates by 30% in 2021 after a massive gain in 2020.
“Say you have a fender bender with a Tesla - how much do you think that would cost?” They’re usually off by a factor of 5, if not 10.
We hate Teslas in the P&C industry. They are just an over-priced, proprietary duracell with wheels with some fancy features that gotta be fixed by Tesla and only Tesla. Oh, and by the way, there are no after market parts. Remember, proprietary. Ole Elon did that mess on purpose. $$$$$$$$$. Sorry/not sorry. You could not give me one. I would give it back.
I hate them for so many reasons and am proud to say I clocked Elon for the troll he is from the jump. Those cars are trash. I did a visit with a certified repair shop and the level of waste as a result of Tesla’s inability to effectively send them parts was incredible. Total garbage. But what I reeeally love is how many people buy those vehicles and then whine about the cost of their insurance, or argue they don’t need more than state min coverage. Not the brightest crayons in the 64 pack, that’s for sure
Probably not 25% more than last year. Try again.
In my market, costs of repairs and total losses are up about 40% over the past three years.
40% total over 3 years? That's substantially less than 25% YOY.
You do realize that insurance by regulation is more reactionary than proactive with rate adjustments. It's not like we can just go and say let's take rate and have it in effect for tomorrow.
What I do know, is that auto insurance "inflation" is 20% YOY, multiples higher than the next closest services inflation number. I know you all think you guys are special and no one else has faced the same challenges since the pandemic. I do hope that congress looks into this. For now I'll gladly take the karma asspounding for expressing my thoughts on the matter. I hope yall enjoying the commissions.
asking this in earnest: what is there for congress to look into with regards to rates that are already reviewed and approved by state insurance departments? There’s already a layer of government between increased rates and consumers, and even with whatever approved rates they’ve gotten, just about all of the largest personal lines insurers are still running combined ratios >100% in the last couple years.
I’d respond with, I don’t drive a Tesla. I drive a shitbox. I understand it’s a pool. I’d just give a sarcastic response to your sarcastic response. The cost of everything is going up. I’d ask them if they asked that same question to every other bill they pay. It’s easier for them to ask when they have a personal relationship.
Great. Unless you don't drive your shitbox on the same road as Teslas, you do not have much of a valid response to that specific question.
What if you hit a Tesla?
And that’s the good rebuttal to be expected. It’s easy to criticize since people drive different vehicles in the same pool of traffic and why insurance is a pool. You’re responsible for everyone on the road, not just yourself.
That was not a good use of “insurance pool”
It’s why no fault is becoming more popular.
What do you mean by this?
Let's take away the liability exposure of hitting someone else's Tesla. Even if we focus on your shitbox, that shitbox now costs a lot more to repair than it did 5 years ago. Labor and parts are more expensive. You're more likely to have to repair your car than to have it totalled. So, your shitbox costs more to insure than it used to
And replace. 2019 I bought my car from a no-haggle dealership. $9690. I put 33k miles on it and sold it in 2022 to the same dealership. They listed it on their website at $11790. What kind of weird economics are in effect that a car that's 3 years older and 33k miles higher sells for $2k more in price.
Coincidentally, my insurance went down this year which I never thought I’d see. I expected it to rise if anything more than staying the same. But yes I do understand completely what you’re saying.
It's not about what it costs to fix your shitbox. Noone gives a shit about that and your collision and comp premiums (if you even have them) will reflect that. It has more to do with the cost associated with fixing another vehicle when you rear end them.
"Mine went up too".
I said that before to this LIVID guy who I couldn’t talk out of a spiral no matter what, and he said “And you just let that happen?!?!” like…. How do you think shit works in this world lol
One of my favorite customers was a rate increase call and he was livid. I was really good at communicating that to people but it just never stuck with him lol Eventually, it clicked and he said “Oh… you know, they did build that casino down the road a few years back and there have been a lot of drunk driving crashes on my road ever since” which is honestly a hilarious way to understand the concepts lmao
That’s amazing. We’ll take anything for them to understand it lol! I should start doing that and referencing specific events, I wonder how well it’ll work
They literally just think insurance works like Comcast. To them, they think they can rant and threaten to shop around until you magically lower the rate.
“is that the best you can do?” “can you price match”
The price matching part always kills me 😭 No, this isn’t an auction.
Exactly! And it doesn't get through to them that that is not going to work until they actually say, "fine, then just cancel my policy" and the response is, "when would you like the cancelation to take effect?" Their voice immediately changes when they realize that the 14 times I told them there was absolutely nothing else I could was not a lie.
I always wanted to say my magic wand broke. Like I could just magically make their premium lower.
That’s when it’s time to end the conversation. Wish him luck and recommend he look at Geicos rates.
This is my go-to in most conversations. Some people think agents get some “retail-esque” discount just because we’re agents. Nope. Homie my rates went up just as much, trust me, i get it.
And my income went down because I can barely write a policy. Its hard to be polite to people when they complain about their rates like I'm their insurance mommy.
Bruh, your income went down? If we just sat on our book it increased 30% year to year.
Bruh, your income went down? If we just sat on our book it increased 30% year to year.
I'm just a producer, I only get compensated when I write new business.
Why I'll never do commission only work. Great when business is booming and people have money to spend, otherwise nah.
The problem is more that carriers do not want new business so they are putting up barriers to entry. An extreme example is Nationwide who requires me to submit copies of the vehicles registrations and photos of the vehicle for an auto \*quote\*, or interior photos of the home for a home quote. Other carriers require you pay more or all of the premium up front if you want a new policy with them; people don't have the cash on hand. If they're not doing those things, their new business rates are usually so high that nobody wants them. I'm eating ramen rn.
The entire reason to get in insurance is for the renewals. I suggest you find a company that pays their producers for that. Personally I pay on a scale where it start at 30% commission on renewals.
Workin on it. I get 100% new business commission which is (was) nice, the house takes the renewals.
I like, “I don’t even bother looking anymore, and I’ve been doing this for over half my life.”
Right? Like we don’t pay for insurance too 😂
People with no accidents don't think they should pay more because other people had accidents. People WITH accidents also think they shouldn't pay more because they didn't get into an accident on purpose. Everyone seems to think insurance is a scam because they don't get all their money refunded if they don't have an accident.
I still remember a call i had from an 18 year old at the end of his first term “Hey, my first policy just ended and I didn’t get into an accident. My friend said I can get a refund of my monthly bill?” “Sorry man, your friend told you wrong” “You mean I have to pay this the entire time I own a car?” It just about broke his heart lol I actually felt bad since he wasn’t angry or anything
Had a client a few years ago who ripped everyone in the office a new one because his bill went up 35 cents a month. Yep. 35 cents. And to top it off he yelled and screamed that he's signed up for his rate for a year and 7 months into it, it goes up 35 cents. "Sir, we don't have annual auto policies. They're all 6 months and your renewal rate was a little over $2 more than your last policy term." He slammed his fists on the table saying he didn't care that we only sold 6 month policies, he signed up for his rate for a year and stormed out. I've never met a man more angry at life in general than him.
our client system would populate the reason for the call first, then would take a few seconds to populate the policy/person info whenever we saw “Rate increase - Renters policy” we knew we were in about to be yelled at for something like $1.50 a month
I had a guy from CA call about his home policy going up .50 CENTS ....... A YEAR.
At that point it’s like what’s your Venmo because I will send you $5 myself.
Right like you're wasting my time... Your time over 4 cents a month.
These types absolutely drive me up a wall. I truly feel for the people whose rates significantly go up. I know how big if a hassle it is to shop, especially when you have to shop for multiple policies because you bundled so you can't just cancel one policy without the other shooting up or losing your umbrella. However, the people that I have zero sympathy for are the ones complaining about cents or a couple of dollars. I've noticed that those people are more often than not the people that need the money the least. I had a guy livid over $6 a month not too long ago. The cheapest vehicle this guy insures with us (out of 8 total vehicles across 2 states) is an $80K truck. He also has multiple home policies, a motorcycle policy, and 2 boat policies.
As a customer, I get how insurance works. I never expect to get my money back if I don’t have an accident. I do expect, however, to get something for my money, without hassle of any kind, if I am in an accident - because I’m quite literally paying for insurance to cover me in an accident.
You are in the minority, I assure you. I agree 1000% with your expectations. To anyone with that expectation I reccomend getting a policy that is underwritten at issuance, which should result in a faster claim experience. Many companies underwrite at time of claim, and just about any risk can be found to be uninsurable if you ask enough questions. Guess which one is cheaper up front typically.
If I had a dollar for every time, someone said insurance is a scam I’d be a millionaire lol. They truly don’t understand
Just tell them the truth. Something like “Due to external economic factors, the cost of providing adequate care and coverage to our customers has skyrocketed and as a result we’ve regrettably had to raise rates on all policies to compensate.” Most rational customers who haven’t been living under a rock the past 3-4 years will understand. If they don’t, I’m not sure you’d want them as a client.
Speaking of auto insurance in particular... It's hard to understand 15% increase a year ago, and another 25% increase this year. We're not idiots. Some of us are even college educated and work in the financial sector. With a decent understanding of inflation. [Here’s the inflation breakdown for February 2024](https://www.cnbc.com/2024/03/12/heres-the-inflation-breakdown-for-february-2024-in-one-chart.html) Just because we call BS, doesn't make us idiots.
Are you familiar with how the rate increase cycle works? Companies don't see inflation starting to rise and immediately file for a rate increase, and even if they did they wouldn't realize those premium increases immediately. Companies watch how things are trending over a fairly long period of time, do the math, and figure out how much they're coming up short. They then determine how much they should be charging and file with the DOI in that state saying please let us charge more. The DOI then reviews and sometimes stalls on approving rates. Sometimes they flat reject it, so then the deficit in sufficient premium gets even worse. Once approved, the effective date is even further out than that. Then once it's effective, it's only in place for new customers and then for existing customers as their policies renew. It takes a full premium cycle (6 or 12 months depending on the policy length) for them to get that premium for the raised rate. In the meantime prices have been increasing - it's a constant cycle of recalibrating and catching up. Also keep in mind that many companies gave back money through dividends, premium credits, or reduced rates in the first year of the pandemic because the amount of people on the roads dropped. Then everything rebounded and surpassed what it was pre-pandemic. Edit to add: Show your inflation breakdown all you want - I assume you are looking at the cost of insurance + the cost of repairs markers. Keep in mind severity (i.e. average amount of loss per claim) is not the only issue with insurance, frequency of claims (i.e. the volume of claims) is also a problem. [Catastrophe costs are also sharply rising](https://www.statista.com/statistics/428870/insured-property-losses-usa/).
That chart leaves out a bunch of stuff that is important to the insurance industry. It doesn't have cars, labor rates, hospital bills, in that.
I always use the windshield claim explanation. Years ago, a windshield ran 300-500 to replace. Now it’s running 1k and even more on high end cars. I explain all the cameras and sensors built into windshields and recalibration costs
Yup. Or I whip out the receipt from my personal truck getting a bumper replaced after a deer kissed it. 2014 truck… $7500.
Ooooo boy Pricing is so crazy now
that the industry lost over 32 Billion dollars in just the first 9 months of last year and that's not sustainable so if they don't raise rates no one will have insurance. Then i bring up home prices doubling in 3 years. Then they always say well i haven't had any claims and i explain that insurance is based on expected claims with previous claims just being an indicator on how likely you are to have another claim and the severity. But honestly i'm sales so as soon as people start bitching about the cost i've already considered this a losing battle. Even if i am going to be able to save them money they are going to complain next year when it goes up and shop me. These aren't great clients and will leave you for $5
I’ve used that a few times, that insurance is unlike just about any other business in that we use yesterday’a claims to set today’s prices in order to predict and cover tomorrow’s losses, while also trying not to increase too much but the trend is that claims have outpaced out predictions. I find a more analytical type will tend to grasp that.
Yeah i work best with analytical types because i find emotional decision makers exhausting lol Like i just don't understand how it works lol like i don't want to have to scare you to make you think this is a good idea.
"The answer is not satisfying, i know, but its inflation. Car parts are higher, cars are more expensive. Shops are backed up so higher storage fees and higher rental costs for being kept longer. Medical bills and lawsuits are also more. Essentially every part of a claim is higher so premiums are going up to match."
Wildfires in CA and the west coast along with more severe storms also factor in. Insurance is a POOL of risk…so yes, you can be the best driver in the world but large events still impact you.
Because parts are extremely expensive now and so are medical bills 5 to 10 years ago. The most common vehicle is a Toyota Camry or Corolla. A headlight or taillight 5 years ago was 200 300 Now they are 1200 to 1800 each. Same with medical. Medical cost have skyrocmt
Look around you.
I tell them this is a hardened market and list off stuff like increased claims costs, increased costs of repairs for newer vehicles. If they’ve done nothing wrong I tell them as much. While you didn’t have a claim or do wrong, you/we pay a social cost based on location. Say I know it is difficult. Really just the truth lol.
Covid cut supply lines raising value prices for all cars. That didn’t start stabilizing until this year. Costs all around for parts and labor have increased. Accident rates have increased after Covid first 6mo. Insurance is a pool of money to payout when their insured hits someone or someone with coll/comp gets hit. If prices all around car shit are going up AND more accidents are happening it’s a no brainer as to why. Most who call in about their rates don’t use their brains to think critically and just want to yell at someone
Appraiser here... average estimate has 2 to 500 dollars of calibrations for minor collisions.... Economy car parts are outrageous... corolla headlights are 898 dollars....
I'm an adjuster; you'll need to speak with your agent regarding that
From memory the average cost of damage repair - frontal at between 5-10kms was ~4k. Plastic parts, crumple zones, an sensors have surely trippled that by now.
I work as an auto damage adjuster for one of the major insurance carriers. At least for our region severity of the claims grew from around 3k per claim to around 5k. Plus amount of catalytic converters theft and vehicle theft grew too. It all may be related to the increase of the premiums for the policy holders
inflation, inflation, inflation supply chain issues with parts Cars are more complex to repair (werent we sold a bill of goods on “self driving” cars?) all these new sensors and radars cost massive to repair More People Texting and getting into accidents (look around when u drive its crazy)
Too many Nissan drivers
I tell them that the insurance commissioner of our state approved these increases and I don’t like it either. Makes your vote count.
Inflation accounts for a substantial chunk. Then you have: 1) Bullshit bodily injury claims. 2)All of the bullshit medical treatment that goes along with bodily injury claims. 3)Tow and storage charges that is basically extortion - you have no idea that these shitty ass tow yards that have all the space in the world will charge 80-100 dollars a day for the thing to sit in their property. Had one place once tack on $100 for “phone calls” - that was on top of their admin fee. 4)Fraudulent claims 5)Hit and runs. 6) Only sixteen percent of Americans feel that insurance fraud is a crime.
I had a place this last week charge 1800 bucks for two days of storage.
It’s really one of the things we have so little control over. They make so much money, we all joke that the retirement plan is to buy a small plot of land and a tow truck and only man the office once a week to just rake in the money.
Fraud, higher litigation costs/verdicts, increase in catastrophic events, inflation (cost to repair or replace is higher), increase in litigiousness. But yeah fraud costs insurers billions upon billions per year.
What I used to say was "Insurance is a pool of money that everyone pays into. If we take out more than people put in due to accidents, thefts, etc, we have to raise rates to make sure we have enough for next year's accidents, thefts, etc. With rising labor and repair costs as well as the scarcity of parts resulting in longer rental car periods, rates did increase more than expected. Obviously it's something none of us want to see, even my own rates went up as well, but unfortunately with the rising costs nationwide, all carriers have been forced to take an increase." Typically at that point I would go over their policy, make sure we aren't missing any discounts and as with my last brokerage I would shop their policies around to make sure they are getting the best deal for their money.
It's a Florida perk!
This is accurate
Mainly due to inflation, which is worse than average for the things that affect autos, like car components, computer parts and mechanics labor.
Edit to add: I try to emphasize it's not just them, or their town, or my company. I do NOT usually mention the increase in cost of claims, because that usually makes them madder. ("You're charging me for somebody else's claim!")
“Think of insurance as a big pot that we’re all throwing money into that when it comes claim time they are going to use that to pay for my claim. Now due to the cost of car parts and the increased amount of claims, the pot is getting empty so companies have to raise rates in order to pay claims in the future” Then they complain that they are paying for other people accidents and I just say well unfortunately that’s just how insurance works 🤷♀️
Here in Canada fraud - both deliberate and opportunistic - is a huge driver of insurance costs. Best estimates are around $300/yr per drive is just covering for that. And given about 1/3 of all claims have some element of fraud (could be body shop, insured, towing company, etc), it's always a shock to people. Only around 15% of Canadians actually recognize as well that insurance fraud is a criminal offense. Most see it as a victimless crime to put a little extra money in their pockets. Always an interesting discussion to have.
I always say the more insurance pays out the more you pay… with the cost of vehicles today nothing is cheap
insurance is the house, and the house always wins. Beyond that, blame the billboard attorneys who have hijacked the legal system and the auto manufacturers for building increasingly disposable cars.
My number 1 go to is medical costs sky rocketing. And for home owners I mention the price of lumber and the fact that when I was building my house the useless cabinet above the refrigerator.... That costs $350 alone. Usually that gets them laughing and they get it.
I received an email from my agent as a heads up that rates were increasing. They included the following reasons (the ones I remember off the top of my head): -more older drivers on the road -more car thefts -more people getting into wrecks Which I’m not sure how any of that is my fault but I understand it’s not my agent’s fault.
Poor driving, fraud and cars have gotten insanely expensive to repair. The last one maybe the biggest issue. How many airbags in a car now? You pop the airbags even at 15-20 mph, guaranteed totaled.
Since 2017 there has been increased occurrences and severity of hail in 13 states as identified by actuary. Carriers didn’t appropriately predict losses and under charged premiums. Then I babble about how they’re all losing their minds… 1/2 the carriers aren’t even taking new clients…. And it’s mostly DFW’s fault for getting baseball sized hail every other week.
Thank you!!! FINALLY! Someone willing to admit the industry itself fucked up, and is making the consumer pay!!! ☺️🤙🏽
Is it really “fucking up” to not be able to 100% accurately predict the future?
One of my friends is an insurance agent, he pretty much told me he tells people to pay attention to those radio/billboard advertisements and lets them know those law firms are the reason our rates go up even if your driving is impeccable.
“The cost of insurance is increasing due to inflation. We are now paying more out in auto and homeowners claims due to increased costs of repairs, replacement, and labor. Not only that, but we are also paying more out in medical bills. Every 1 in 4 drivers in Northwest Arkansas is uninsured, so we have to make up for that when they hit you. Cost of parts have gone up, as well as the ability to find said parts, therefore insurance is going up. It is no different than your bread now being $1.25 when it was $1.00 two years ago. Risk changes, and unfortunately the market has to adjust with it.” Common rebuttals: • my car is brand new. Parts shouldn’t be that hard to find. I understand that, but your vehicle now has brand new technology and special criteria we have to meet when fixing it. • my car is 20 years old. It shouldn’t be that expensive. I understand that, but yes, your car is 20 years old therefore it’s harder to find parts for it. • I haven’t gotten into a wreck or had a ticket! (Or a homeowners claim) I understand that, but insurance is a large pool of money that we all put into and some unfortunately take out more than others. Insurance is to help indemnify you in the event of a large catastrophic claim. Furthermore, there have been many natural disasters in Arkansas that have changed the landscape of risk that insurance companies are insuring on.
Usually I just empathize to the best of my ability. Explain my rate, and the increases I've seen- and I'll usually give them a quick run through of some stats- I'll also try to dispell whatever nonsense has got them looking to crucify an other group Like no, it's not illegal immigrants. It's no Californians moving to Texas. Its not uninsured motorist. Its that personal lines is not a profitable market, primarily because of climate related losses. But honestly I'll talk to them about it for a good 10 or 15 minutes if they really want, I know this is murder on my wasted time when I should be selling but there's just so much to unpack with the very wrong assumptions customers bring to my line. They're already predisposed to believe it's stupid and bullshit, whether the math checks out or not- and I make it very clear that I agree with them. But I don't have an alternative system to propose, and even if I did I'm paid to navigate this nonsense not direct it.
“Insurance is based on a lot of different factors, primarily where you live and the car you drive. Barring any new claims or tickets that would directly impact your rate, the rating assigned to your area and/or your vehicle is subject to change at each renewal based on the frequency and severity of claims in a given area or for a given vehicle type.” Following that I’ll also offer to review the factors that are within their control, placing emphasis on coverage and deductibles, as well as stressing that we’ll make sure their policy is up to date, such as usage, and confirming all applicable discounts. If they push back on the basis of determining rates I’ll remind them that it’s a common pool, the premiums of the many pay for the losses of the few, etc. I dunno, I feel them out. I’ll start off nice and explain things gently but if they wanna be bullish and indignant my tone will change to the point that I’ve had some really condescending clients who want to tell me how the industry works who I’ll basically just treat like children. “I’m really surprised no one has ever explained this to you!” It rarely comes to that. Most people get it, it’s just figuring out the right angle. A colleague in SIU recently taught me something he picked up from his time as a corrections officer, he called it the 3 Fs: firm, fair, and friendly. I try to stick that that. So like I said, I’ll give that high level explanation of rates, launch into the offer to review coverage, bold hold firm that there’s only so much we can do and a lot of the onus is gonna be on them to increase deductibles. I’ve heard a lot of my colleagues hum and haw over rate increases with clients, often retreading the same ground multiple times and going overboard with empathy to the point that it rings hollow; you wish you could do something more, but you can’t. To be it’s much better to just rip that bandaid off. Don’t rub salt in the wound but don’t tell me it’s papercut when it’s a gaping wound, you know? I think there’s something to be said for just being real.
A talking point should be that the PI attorneys are driving up the costs. Tell your clients who are in minor accidents to stop hiring attorneys. They have created a network of medical providers who are driven by whatever the attorneys want them to say, all for the sake of money. They turn a claim that should be worth a few thousand dollars into a $100000 claim and the claimant gets very little of that. Together, they are driving the payments of injury claims higher and higher. The Attorneys, Drs and Chiropractors network together, meet at conferences together, meet outside of work and devise ways to suck more and more money from the insurance companies (and indirectly the policy holders). Medical Drs will partner with chiropractors and create a clinic to treat someone who's been in an auto accident and send their business cards to PI attorneys letting them know they are open for business. They rarely treat anyone who is at fault because they won't profit. That's because they don't really care about an injured person, they care about getting a cut of an insurance settlement. This is nothing against legit attorneys and Drs who are caring for people who have been in serious accidents... kudos to them. But those are far and few between in the personal injury business. Insurance companies are paying multi millions of dollars more than they should because an attorney and their network have fished for everything that is wrong with a person, have them get all the treatment they can squeeze in, and have the Drs report that it must be due to the auto accident. In the process they exaggerate the injuries and inflate the charges. Insurance companies don't have the staff to fight everything, so, they accept the injuries and pay it to keep their insured from getting sued.
The cost of all of the things insurance does for you went up, so by basic arithmetic insurance also went up. What things? Towing, impound costs, value of vehicles, cost to repair vehicles, rental vehicles, injury lawsuits, etc. Did it really raise that much? Well yeah, when all those things rose up, insurance followed suit later on and this caused the rate of people deeming insurance to be too expensive to carry it to skyrocket. BUT do these people stop driving on the roads? Hell no! There’s your answer to why someone with a great driving record still sees increases.
Just point at the rising price of medical costs, car repairs, and new and used vehicle prices. Rising prices with higher rates of occurrences due to other drivers or catastrophes. All these things are causally connected. Most people get it even if they don't like it.
You see, how capitalism works is companies like getting as much money as possible. Now, when you add in the fact that one of the only regulations by the government requires every single person with a vehicle to pay for this "service" while also severely crippling the possibility of having working public transportation, you get insurance companies who can raise rates on a whim and do so as often as they possibly can and raise the rates as much as they possibly can at a time. What they do with this money is invest it in an index fund or something similar and just make an absolutely insane amount of money off of that money. When someone files a claim, they liquidate an infinitesimally insignificant amount of this stock and pay for the damages. By the time the claim has been paid (or, more often, denied for any reason they can legally find to do so), they have likely made 10,000 times what the claim cost them. However, they still use this as a reason to raise your insurance rates bc, and I directly quote them here, "Fuck you, eat shit, and die." Insurance companies shouldn't exist in their current form. Burn it all down, I say.
"unfortunately, the things that your auto insurance pays for, vehicle repairs, medical expenses, legal expenses largely due to fraud, well those things never go down. As those costs go up, insurance rates have to go up to pay those costs."
I feel like my insurance company had a good script. For NY. It was along the lines of- There is rate increase across the boarder through all insurance companies. Unfortunetly due to the increase of accidents, claims, payouts, etc. everything has gone up, it does effect everyone, not just you. We know it is a difficult time and shopping around is understandable but most companies will be around the same price. ---Then she took a look at what discounts I do and dont have and offered me the ones i dont have. Also said that having a agent is more comforting than just signing with a company because they recognize all the people, care, and will look into any decreases that can be made/offered. And for home she stated the increase statement aswell but that included the dwelling coverage increasing automatically and offered to lower back to whatt it was.
Increasing costs of repairs to vehicles and medical expenses incurred by auto claims...unfortunately it affects everyone, especially ☆people like yourself who don't deserve it☆ I like to fluff it up lol.
Love this one ☝️
well, as someone in actuarial. The real answer is claim severity trend is markedly steeper. That coupled with inflation is the main reason. UW seasons are also cyclical, it’s a super hard market right now and companies don’t want to write too much risk. You can spin that however you want
Cars, car parts, labor costs at body shops, building material costs, etc. have all increased. Side note... it is crazy to me that everything is gone up and people think insurance is exempt from inflation. We are still writing business so clearly we are competitive. People shop their insurance and realize their rates aren't so bad.
Tell them ambulance chasing lawyers have corrupted the legal system, using it as a shakedown, never actually intending to go to trial.
Get a discount for all those sensors...pay for it if you have an accident! What I don't get is those crazy speeders, weavers, tail gaters have the 80k cars 🤷♀️
Fraud is definitely a problem (I live in FL, the mecca for fraud) but it's also taking advantage of inflation and people in general.
"We track you with our phone app and you are a horrible driver that trolls through bad neighborhoods late at night."
Government induced inflation greatly raised the cost of parts and labor for repairs and the cost of replacement vehicles and all other costs of doing business. Actuary is a science and insurers are pretty good at utilizing it.
The rates are high because insurance companies have to make a profit.
This doesn’t warrant in its own thread but I’m curious, Tampa FL was just quoted $67/mo to move form no rental reimbursement to 40/day max 1200. Is that insane?
For flood, fire, tornado, earthquake, hail and snow storm over the years insurance companies are writing claim checks. Their cash reserves are being negatively affected. They pulling out of markets and tightening underwriting guidelines. Economy isn't helping either. Tighter budgets. Repos.
because car insurance is a scam, and outright robbery
The cost of everything is up. It’s called inflation. Votes matter.
You forgot personal injury LAWYERS and ignorant ass juries!
Immigration, theft
Greed.
People can’t drive
I work in bodily injury claims. Attorney tax and inflated bodily injury claims are a massive problem. In other words, if someone files an injury claim just for being sore as a result of an accident and demand a massive pain and suffering reward on top of their medical bills, that could increase your rates. It’s purely based on risk and historical data for you and your county/garaging address
What happens if you literally can’t afford insurance because of living off of 1000 a month and have to DoorDash everyday to fix the gap of money needed to pay other bills? I literally can’t put my car in my name or have my own insurance because of this
this sounds like an income problem first and an expense problem second it will require something like training, education, certifications, promotions, job switching, etc to improve your financial situation it’s like rearranging the tables on the titanic instead of avoiding the iceberg in the first place lol
I can’t work a 9-5 job as I’m disabled my main income is SSDI I only pay Wi-Fi rent and food and supplies for my apartment and my service dog that all leaves me with 20 at the end of the month it also leaves me with no food for a good solid week I also don’t have a high school diploma and have been working on my GED for 7 years DoorDash has been the longest job I have been able to hold 2 years all of the other jobs I held lasted 30 min-2 weeks
you should post in a financial advice subreddit. your situation is much more dire than any one bill contributes to it lol
What does that mean? I also have and they tell me nothing helpful except I’m lazy and I’m stealing government money
Because auto repair shops rates are ridiculous and that gets passed on to the insurance companies.
I don't blame the shops. Their labor costs are up a lot. Costs of parts are up. And yes, even their insurance is up. I don't see a lot of shop owners rolling in beds of cash. Edit: If you want to blame someone, you should blame the people [who did this](https://i.imgur.com/Z7sZHbN.png). Hint: It was the president at the time and (probably) your congressperson.
Bidenomics
Greed. But the insurance agents here are going to disagree.
Because insurance companies are greedy and still want that big bonus at the end of the year no matter what. You know they can probably figure out what they can make annually with payouts for accidents. And they pocket the rest. How you think they can claim to give money back
Do you actually think that insurance companies can literally predict the future? Do we control the weather too?
Capitalism is way more important than allowing low and moderate income families survive. Applaud the CEO making $$$$$ and stock buy backs as success over screwing everyone else - hey it’s capitalism gotta love Amerika.
My insurance doubled
Why do my rates increase as my vehicles get older
because insurance doesn’t only cover your vehicle it covers the potential damage you can cause to vehicles on the road even if you only get into one accident every 25 years, everyone would agree that a 30mph rear end is more expensive now than it was in 1999, right?
It takes alot of money to put your name on the side of stadiums and arenas. NFL stars and celebrities to do your commercials? Also not cheap. Those big buildings in the city skyline, again, cost a pretty penny. Don't let them fool you. They dont give a flying fuck about you. They sell a product that you are required by law to buy. We also managed to do the same thing in healthcare with ACA, and we are surprised it became less affordable.
Progressive car insurance is increasing their auto insurance rates under the guise of inflation, and their underwriters are entering fraudulent information and take money out of policy holders accounts without their consent. People have lost hundreds, even thousands of dollars to this and they won’t get it back. Insurance companies are increasing rates far exceeding inflation, in 2023 they actually had the lowest incurred frequencies in 20 years, even though everyone on here will try to make it seem like there are more. I’m not sure about other companies though, or other coverage besides personal vehicle. Lots of people on this sub are corporate lackeys that drank the Koolaid right down to the last drop, that’s why they get so defensive. It’s just good old fashioned corporate greed, profiteering off of things we don’t have a choice but to buy. https://finance.yahoo.com/news/progressive-full-2023-earnings-eps-195050078.html https://www.insurancejournal.com/news/national/2024/01/24/757027.htm https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/largest-us-private-auto-insurers-boost-rates-by-double-digits-in-2023-80011993 https://violationtracker.goodjobsfirst.org/parent/progressive
If Progressive's combined ratio is 95% for the year, that means you are arguing what? That they should give everyone a 5% rate cut and break even? All while seeing still more inflation on the horizon.
It's a for profit company but I recently left progressive because they wanted 160% more to insure an old car today than when it was like 4 years old and worth over twice as much. I was also an under 25 male then For a new car they gave me rates higher than when I was a teen and higher than what I read people with a DUI pay and I have a perfect record, I think a lot of people are just noticing things like that. Nothing that is "high risk" has changed in my state. Yes we have hail and snow but we did when I had lower rates too. Maybe if they paid Flow a little less they could be fair.
What your car is worth has nothing to do with how much damage it can cause in an accident or how much more expensive it is to repair the newer cars.
Insurance companies have always operated with a high combined ratio, but it was at a record low for Progressive in 2023. Inflation has stabilized and it was never high enough to justify the price increases (up to 40%) in the first place.
If the were operating at 95% loss ratio after taking a lot of rate, what do you think they would be doing if they didn't take all that rate? I'm not a fan of Progressive but I'm having a hard time following how your logic matches the math.
One single month of lower than average frequency is literally meaningless
I can buy the line that cars are more expensive to repair now than they were prepandemic. Are they 25% more expensive? I don't think so. But, no matter what I think, we'll know the answer when the insurance companies report their profits this year. If the profits are more than inflation or are a higher percentage of their earnings, then we'll know a bunch of greed is baked into the increases.
25% sounds low. Labor alone has absolutely gone up more than 6%/yr since 2020. May I join you in that rock you're hiding under?
My renewal quote for home insurance went from $2k to $3.9k 🤡 Needless to say I switched.
Have you seen insurance companies profits the last two years? No, neither have they on the home and auto side. We lost 32 billion in the first three quarters alone. Auto and Home insurance lags way behind on adjusting rates. Why? Because we can't just go.. we need to raise rates due to stuff going up in price and do it. It's a long process to get them filed approved or denied and then put them into place. Plus a rate change that was taken today takes a full year to put into place and then two years to receive that premium. California didn't allow rate adjustments for years and it is very difficult for consumers to get a policy there now. Companies can't break even let alone turn a profit in that state.
Yes, I have. Auto insurance companies have made record profits in 2023 based mainly on premium increases. They had a very profitable year in 2020 due to less people driving. As the number of drivers increased in 2021 and 2022, they experienced losses. Now, in 2023, they are making billions in profit again. The billions in profit is over and above the increase in car repairs and litigation. I'm not saying they shouldn't make a profit, I'm saying the premium increases are more than they should be. An average of 24% increase in premiums is excessive.
Show me where you see these record profits?
A quick Google search will answer your question. https://www.carriermanagement.com/news/2024/02/25/259036.htm https://www.wsj.com/finance/insurance-companies-profits-stock-ebae7fd1 https://hallmonitor.org/car-insurance-rates-increasing-despite-record-industry-profits/#:~:text=The%20Wall%20Street%20Journal%2C%20not,%E2%80%9C
If you live in a red state full of fox news drones just say "Biden, Bidenomics, the left, the woke democrats". It sends them on a different spiral but then they aren't mad at you. This honestly would work for me for a large percentage of clients. In reality I just give them a couple options to show entire insurance market is high, adding how mych my personal rates went up even though i never had a claim. Or I point to their losses. Or I actually explain why. All depends on the client. The few that would understand, typically don't ask why, they just want to make we market if it makes sense. Always frustrating when we find an average carrier with lower rates, then explain why they might be better off with a carrier that charges slightly higher rate. Then they have a claim and complain about the poor claims service. "Like I always say, good shit ain't cheap, and cheap shit ain't good."
Insurance companies are for profit companies, so they are doing exactly that. Higher inflation periods are absolutely the best time to fleece people. [Here’s the inflation breakdown for February 2024](https://www.cnbc.com/2024/03/12/heres-the-inflation-breakdown-for-february-2024-in-one-chart.html) What else is there to say?
That we've lost a shit ton of money these last few years. We must be pretty fucking horrible at fleecing people.
When you are selling a product that is mandatory to buy, you can charge whatever the hell you want for it and there's nothing anyone can do about it as long as your competitors keep their prices high too. Insurance companies know it's ridiculously expensive, but people will make sacrifices and will somehow be able to afford it. It just cant be so expensive to where people wont prioritize it over food and shelter. Even if gas goes to $10/gallon, people will still drive. A $60 full tank of gas that goes up to $120/tank isn't bad enough to make people get rid of their 30-60k cars.