Entries Tagged 'Car insurance' ↓

Let’s start off in New Hampshire. The first question is whether the design standards in modern vehicles make annual safety checks unnecessary. If you said, “yes”, you are with the thirty states that do not require any safety checks. The theory seems to be responsible drivers maintain their vehicles and are not a hazard on the roads. If there’s an accident, they pay more for their insurance – it’s a stick and carrot approach to social responsibility except it forces up the premium rates for all drivers. In states where there are annual checks, vehicles are better maintained, there are fewer accidents, and drivers pay lower rates. New Hampshire has just decided to move from one to two-year inspections. Now there will be thousands more vehicles on the road with poor brakes and defective front ends. Guess what will happen to the premium rates.

In Mississippi, there’s a bill to enforce the mandate by requiring drivers to produce proof of insurance before the tax collector issues a tag. Governor Haley Barbour is currently considering whether the new database will be open to the police to check the status of all drivers. If he does sign this bill into law, it will potentially reduce everyone’s insurance premium rates. The more people are forced into paying for the basic minimum liability policy, the less the law-abiding people will pay.

In New Brunswick, the Insurance Board is refusing to release a report into whether local insurers have been overcharging drivers for the last seven years. The lawmakers established an arms-length board in 2004 but, for some reason, they are less than enthusiastic about forcing disclosure of this board’s investigation. In the meantime, New Brunswickers continue to pay higher than average premium rates. Continue reading →

Whenever you start thinking about insurance, the first thought tends to be about the risks of different types of traffic accident or the ways in which you might lose the vehicle. You make lists of collisions, vandals writing their names on your bodywork, thieves driving the vehicle away, floods carrying your car off, and so on. Then you get to all those other personal factors like where you live, what your credit score is, and so on. After a while, you wonder how you can hope to find cheaper cover when, so often, whether you make a claim or the amount of the damage has nothing to do with the way you drive. Now add in the fact that you have no control over the cost of gas or of how much the body shop will charge to repair any damage and there’s a temptation to give up. Except that’s a bit negative.

No matter what you may fear, insurance is really all about whether you are going to make a claim. Those who have the best track record, have the lowest premium rates. So don’t give up. If you have a defensive style of driving and avoid all the most obvious situations in which you may get into an accident, the insurer will reward you over time. Then you ask whether there’s any way in which you can speed up time.

Welcome to the brave new world of technology. Thanks to the development of all our cell phones and other mobile computers, there’s a way of continuously transmitting information from your vehicle. Manufacturers are now fitting some clever chips to monitor exactly how your vehicle is performing. If something starts to go wrong, the vehicle displays warning messages and can signal your usual mechanic with details. This covers everything from whether your tires are properly inflated, the level of wear in the brakes, and so on. Add in the GPS transmitters so that, if someone steals your car, you have a reasonable chance of finding it, and the package is genuinely useful. Continue reading →

It’s remarkable how trusting some people can be. You ask them for help, you make friends with them even for a moment and, suddenly, they are prepared to do things for you. In the best cases, they are prepared to give you money. Life can be sweet for the people with honest faces and a good scam. Except, after a while, you run out of easy marks, so have to look around for a new set of victims. One of the next steps up the ladder is the photocopying paper invoice. It’s surprising how many small firms will just pay an invoice that comes in for routine consumables used around the office. No one thinks to count how many packs of paper they have or how many deliveries they took. If the invoice looks right, they pay. But then you could move higher up the fraud tree.

The current low fruit waiting to be plucked are in the insurance industry. Why is this? Well, it comes down to a number of factors. The first is the usual inefficiency of large organizations. With so many people working the administrative side of the business, many do their jobs on auto-pilot. If they can tick all the boxes on their checklists, they pay out on a claim. Second is the increasing boldness of the fraudsters. They are now into staging traffic accidents. Those with small numbers of people to call on find clinics with flexible morals and pay kickbacks for unnecessary treatment and favorable medical reports to support their claims. The professionals set up their own clinics. Some are just shells to front the fake medical reports. Others are genuine to slip through the fake claims.

New York recently announced that a special fraud task force had arrested one-hundred-fifty-nine people with millions of dollars in claims. But this is the tip of the iceberg. The same investigators report 12,800 suspected cases of fraud in 2010. The task force does not have the resources to investigate more than a handful of these claims. They will just be paid out. Why should we worry? Continue reading →