insurance

[Roger M. Woodbury]

...in Columbus, Ohio.....well, I would guess that the underwriter looked at
the major and significant differences in the 91 versus earlier 200 Quattros,
and thus the higher premium.  However,  also suspect that something else was
afoot, as the additional car, since it WAS similar to the others at least in
make and model type alone shouldn't have caused your premiums to double.

It was probably more like the insuror deciding to limit the number of that
type of vehicle that it would underwrite in that territory, and thus, raised
rates on, say Audi/Mercedes/BMW with a symbol higher than seven, maybe.
Then, too, it could have been where you live...the company's recent
experience in your territory specifically having been bad, and thus, the
rates were raised.

Another example of how specific the underwriting can be.  My policy here in
Maine (USAA), specifically states that racing, competition, or preparation
for racing is excluded.  This would mean that if I drive my car in an
autocross...not specifically racing...and roll it, there will probably be no
coverage.  I actually checked on this with USAA....no, not the underwriting
department, but the CLAIMS department where final decisions regarding losses
are handled.

What I was told was that gymkhanas and autocrosses were coverable under the
policy, however, time trials were absolutely not.  I then asked about PCA
Driver's Ed courses, and they said, absolutely not.

Yet, I know PCA members in New Hampshire who regularly take their street
Porsches to Driver's Ed, and have been specifically told by USAA that they
are covered.

The difference, according to the claims manager with whom I spoke, was the
difference in demographics and quite likely the number of participants and
other reasons, not related to the automobile use itself.

Thus the underwriting decisions can be related to a whole lot of things,
some quantifiable, some not.

Not often in auto underwriting due to the sheer numbers of policies and
vehicles involved, but sometimes a given underwriting manager for a specific
territory, can rather arbitrarily decide that he/she wants to improve the
unit's underwriting/loss ratio for the territory.  Last month, say, they had
five losses involving an ABC kind of vehicle.  The manager decides to
suspend all underwriting of ABC vehicles, and to increase rates for all ABC
vehicles to the limit of the insurance company's filing with the state
insurance department.  Thus, the rates on Mrs. Ferd's 1997 ABC Singasong
Coupe, go up sixteen percent...even though she has never had a loss or
conviction of any kind.

Mrs Ferd is outraged.  She runs right out to XYZ Insurance Agency, and buys
coverage for 873 a year, which is FIFTY DOLLARS less than she paid to the
Old Smoke and MIrrors Insurance Agency, where she had been insured for
twenty-seven years.

Forty seven days later, she loses control on a patch of ice and rear ends a
school bus.  The ABC Coupe is a total loss, and the collision does $17,000
damage to the school bus.  In addition, thirteen fourth graders require
hospitalization with one child seriously injured.  The total amount of the
loss paid, and in reserve for the insurance company is $487,679.  It will be
ten years before the seriously injured child's lawyer permits the case to be
closed, as there is some question whether or not the younster will walk
normally again.

The insurance company had actually collected $387.00 in premiums, of which
$212 had actually been earned by the duration of the coverage.

This from a basically "not at fault" accident....no drinking, no speeding,
nice little lady insured with a clear record....the stuff that keeps
automobile underwriters awake at night!  It could happen that way, and thus,
it amazes me that people think ill thoughts about auto insurance
underwriters in general....and no wonder the high performance stuff is
sometimes tough to get covered.

Now, shall we talk about that 16 year old, honor student who ONLY gets to
drive the car on weekends?  ....and oh, yes, and he NEVER gets to drive the
Porsche??????

Right!


Roger

----- Original Message -----
From: "David Conner" <conner at cfm.ohio-state.edu>
To: "Roger M. Woodbury" <rmwoodbury at downeast.net>
Cc: <quattro at audifans.com>
Sent: Tuesday, February 19, 2002 1:54 PM
Subject: Re: insurance


> I'm always at risk when it comes to lusting after other Audi's... the
ur-S4
> currently listed on E-Bay for low $$$, or maybe a gently used A8 or S4.
> But I'm wary of the potential insurance costs no matter how low the
> purchase price.  I guess the only safe thing to do is discuss these
> fantasies with my insurance agent.  I've got fairly low incurance costs
> now... currently spending about $2k per year on insurance for four
> cars/three drivers.  When I owned a 91 200Q several years ago I was
> surprised at how much it cost to insure compared to my other cars.  At the
> time I had an 86 4kq, 87 5ks, and an 89 100 with two drivers.  My
insurance
> cost doubled when I added the '91 as a fourth car.
>
> Columbus,OH
> 89 200q
> 89 100
> 87 5ktq
> 87 5ks
>
>
> At 12:45 PM 2/19/02 -0500, Roger M. Woodbury wrote:
> >I am sure that this is proprietary information either of the Insurance
> >Services Office, or perhaps the insurors themselves.  Normally, insurance
> >agents are furnished with underwriting guidelines and the automobile
> >symbols...normally physical damage ratings...are shown, along with
> >instructions concerning how to make the submission to the underwriting
> >offfices.  The actual vehicle model means relatively little as far as the
> >premium is concerned.  The driver's age (drivers' ages), driving record,
> >type of vehicle and its age, THEN the particular model, I believe is the
way
> >that the normal underwriting "screen" is applied.
> >
> >Example.  I was expecting my premiums to be quite stiff when I bought my
> >Porsche 928, despite the fact that I am comfortably over the age when
this
> >sort of thing should make a difference.  I have quite a lot of liability
> >insurance, but was willing to accept a thousand dollar deductible for
> >comprehensive and  collision insurancce.  The premium for the 1987 928S4
was
> >around $800 per year, and was just added to my policy with my other
> >vehicles.  It was less than my 1989 Audi 200 Wagon on the same policy,
and
> >not much more than the 944 that it had replaced.
> >
> >When I was an independent insurance agent, such a vehicle would have been
> >VERY difficult to place at all, under a standard policy, and usually only
> >for an older operator with NO young operators in the household.
> >
> >My daughter recently talked to the insurance company about various cars.
> >She found that they told her freely what they rated "up" and did not.
Audi
> >was rated quite low by them....good crash resistance and good safety
record.
> >The Misubishi Gallant that she presently has, was rated as so much tin
foil.
> >
> >Roger
> >
> >----- Original Message -----
> >From: "David Conner" <conner at cfm.ohio-state.edu>
> >To: <quattro at audifans.com>; <rmwoodbury at downeast.net>
> >Sent: Tuesday, February 19, 2002 12:54 PM
> >Subject: insurance
> >
> >
> >> Good article!
> >>
> >> I'm interested in the item re: "How much your car model affects your
> >> premium -
> >> Cars are given a rating from 3 to 27, and the higher the number, the
> >higher
> >> your premium.
> >>
> >> The article says these numbers for various model cars would be
difficult
> >to
> >> find.  Does anyone know where/how to find them?
> >>
> >> Dave C.
> >>
> >>
> >
> >
>
>