auto insurance rip off

[bcp]

Looking over my insurance bill, I noticed that the premium for the collision and the comprehensive has not gone down since I first purchased the vehicles. It has actually gone up a few dollars.
So I have to question this.
when you buy the vehicle, lets say the lot price is 50k.
the insurance charges you a premium based on their replacement of that 50k vehicle. Fair enough.
Now, 3 years later the vehicle is worth maybe 30k, but even though the exposure for the insurance company is reduced, your cost for that coverage is still based on the original 50k replacement cost

Anyone else think that the cost of the collision and comprehensive portion of the bill should go down as the insurance companies exposure is reduced?

there could come a point that you are paying 50k worth of insurance for a policy that will only cover maybe 20k.

 

[aps45819]

Shop around with different companies and then make a counter offer to your current insurer.
As long as you're willing to pay, why should they offer to lower your premium?

 

[GWguy]

Yes and no. The value of the vehicle overall does depreciate. However, the cost to repair that vehicle doesn't change over time, nor do medical expenses for any injuries, and that's what you are paying the premium for. If I had an accident on a 2 year old car, it would cost x. If I had an accident with that same only now 10 years old, it would still cost x. The cost of labor never goes down, and the cost fo the replacement parts does not go down.

 

[glhs837]

Not to mention the vehicles loss rate might have increased. If tis the preferred ride of drunken rednecks, who crash a lot, that would lead to higher repair incidence.

 

[EmptyTimCup]

Not to mention the vehicles loss rate might have increased. If tis the preferred ride of drunken rednecks, who crash a lot, that would lead to higher repair incidence.

years ago when I moved 12 miles closer to the beltway from Piscataway MD, with a Clinton Zip ... to a Fort Washington Zip 3 miles from the beltway, my insurance went up 16 bucks per month ...

:shrug:

closer to DC and the #### ups ...

 

[bcp]

Yes and no. The value of the vehicle overall does depreciate. However, the cost to repair that vehicle doesn't change over time, nor do medical expenses for any injuries, and that's what you are paying the premium for. If I had an accident on a 2 year old car, it would cost x. If I had an accident with that same only now 10 years old, it would still cost x. The cost of labor never goes down, and the cost fo the replacement parts does not go down.

yes the cost of repair goes up while the value of the car goes down,
Now consider.
when they total out a car, they do it based on something like the repair cost being 80% of actual value. Their exposure to cost is always going to be 80% of value, so in reality their possible expediture goes down along with the value of the car.

so if you had an accident on a new car, their possible loss would be equal to the value of that new car. If you had the accident in your 10 year old car, their possible loss is going to be based on the 80% of total value.

as far as the medical costs, that is another catagory on the insurance to start with.

 

[lovinmaryland]

Looking over my insurance bill, I noticed that the premium for the collision and the comprehensive has not gone down since I first purchased the vehicles. It has actually gone up a few dollars.
So I have to question this.
when you buy the vehicle, lets say the lot price is 50k.
the insurance charges you a premium based on their replacement of that 50k vehicle. Fair enough.
Now, 3 years later the vehicle is worth maybe 30k, but even though the exposure for the insurance company is reduced, your cost for that coverage is still based on the original 50k replacement cost

Anyone else think that the cost of the collision and comprehensive portion of the bill should go down as the insurance companies exposure is reduced?

there could come a point that you are paying 50k worth of insurance for a policy that will only cover maybe 20k.

As your veh gets older the prices for parts also increase, and sometimes are hard to find.

It never hurts to shop around. If you do though make sure that you are getting quotes that are "apples to apples" A lot of companies will quoteyou with lower liabilty limits and higher deductibles.

 

[bcp]

As your veh gets older the prices for parts also increase, and sometimes are hard to find.

It never hurts to shop around. If you do though make sure that you are getting quotes that are "apples to apples" A lot of companies will quoteyou with lower liabilty limits and higher deductibles.

as it gets older, the chance of getting something not from a junkyard is pretty slim.
and as I mentioned a few times now. The cost of fixing is not what the issue is. Its the amount they are willing to pay before they total it. THAT amount is reduced with time, THAT amount is what you are still paying coverage for at the new cost level.

and they all do it.

makes me want to have an accident just to make them pay..
Hmm, I do have a chip in my windshield that has been there for a while, Maybe its time to go put some pressure on it and have them replace it.

 

[awpitt]

Looking over my insurance bill, I noticed that the premium for the collision and the comprehensive has not gone down since I first purchased the vehicles. It has actually gone up a few dollars.
So I have to question this.
when you buy the vehicle, lets say the lot price is 50k.
the insurance charges you a premium based on their replacement of that 50k vehicle. Fair enough.
Now, 3 years later the vehicle is worth maybe 30k, but even though the exposure for the insurance company is reduced, your cost for that coverage is still based on the original 50k replacement cost

Anyone else think that the cost of the collision and comprehensive portion of the bill should go down as the insurance companies exposure is reduced?

there could come a point that you are paying 50k worth of insurance for a policy that will only cover maybe 20k.

You need to shop around. My collision and comprehensive premiums have decreased a little but like was already said, costs for parts and labor are constant.

 

[awpitt]

Yes and no. The value of the vehicle overall does depreciate. However, the cost to repair that vehicle doesn't change over time, nor do medical expenses for any injuries, and that's what you are paying the premium for. If I had an accident on a 2 year old car, it would cost x. If I had an accident with that same only now 10 years old, it would still cost x. The cost of labor never goes down, and the cost fo the replacement parts does not go down.

OP was talkiong about collision and comprehensive, not liability and PIP.

 

[bcp]

You need to shop around. My collision and comprehensive premiums have decreased a little but like was already said, costs for parts and labor are constant.

I dont think you are following, or maybe Im having a hard time explaining...

It does not matter what the cost of parts or labor does in this coversation.
What matters is that the insurance is originally written for a replacement amount.
when the car is new the amount they are willing to pay before the car is totaled might be 40,000.
as the car ages, the amount of payoff for the same car might be 20,000.
their exposure decreases with time yet they continue charging you for the original replacement premium.

as their risk decreases, so should the premium.

 

[lovinmaryland]

I dont think you are following, or maybe Im having a hard time explaining...

It does not matter what the cost of parts or labor does in this coversation.
What matters is that the insurance is originally written for a replacement amount.
when the car is new the amount they are willing to pay before the car is totaled might be 40,000.
as the car ages, the amount of payoff for the same car might be 20,000.
their exposure decreases with time yet they continue charging you for the original replacement premium.

as their risk decreases, so should the premium.

Replacement isnt the only thing considered in that quote, there are hundreds of factors age, sex, driving experience, credit history, etc...

Again you might want to get a few comparison quotes.

 

[awpitt]

I dont think you are following, or maybe Im having a hard time explaining...

It does not matter what the cost of parts or labor does in this coversation.
What matters is that the insurance is originally written for a replacement amount.
when the car is new the amount they are willing to pay before the car is totaled might be 40,000.
as the car ages, the amount of payoff for the same car might be 20,000.
their exposure decreases with time yet they continue charging you for the original replacement premium.

as their risk decreases, so should the premium.

I totally understand what you're saying. I wonder what the percentage of insurance claims are for repairs as opposed to paying total losses.

While the part of the premium should go down as the cost to "total" the car goes down, the cost to repair cars does not go down so there should be some decrease in premium as the car ages but not a whole lot. Like I said ealier, I have seen a decrease in my premiums. If you haven't, you should shop around.

 

[bcp]

I totally understand what you're saying. I wonder what the percentage of insurance claims are for repairs as opposed to paying total losses.

While the part of the premium should go down as the cost to "total" the car goes down, the cost to repair cars does not go down so there should be some decrease in premium as the car ages but not a whole lot. Like I said ealier, I have seen a decrease in my premiums. If you haven't, you should shop around.

when they set the price of the premium, they set it to the worst case scenerio, as in, total payoff, non repairable.

 

[awpitt]

when they set the price of the premium, they set it to the worst case scenerio, as in, total payoff, non repairable.

Yes, blue book; however, projected costs for repairs for one or two accidents are also figured in.

 

[bcp]

Yes, blue book; however, projected costs for repairs for one or two accidents are also figured in.

and those two repairs would be factored at the maximum cost before totalling.
so, even then it would drop their risk.

 

[awpitt]

and those two repairs would be factored at the maximum cost before totalling.
so, even then it would drop their risk.

I'm not disputing that premiums should decrease over time, mine have. The point for you is that if your premiums haven't decreased, you need to go shopping.

 

[lovinmaryland]

and those two repairs would be factored at the maximum cost before totalling.
so, even then it would drop their risk.

You, your spouse, basically any listed driver or driver in the household is the actual risk.

 

[bcp]

You, your spouse, basically any listed driver or driver in the household is the actual risk.

well in that case
the last accident that could be considered my fault was in 1979

the last ticket other than seatbelt violations was speeding, 1986.

Im pretty sure Im high risk.

 

[aps45819]

well in that case
the last accident that could be considered my fault was in 1979

the last ticket other than seatbelt violations was speeding, 1986.

Im pretty sure Im high risk.

You're over due for an accident.