Friday, July 27, 2007

Insurance Rates

I just paid the semi-annual auto insurance premium on my mother's car. I happened to come across an old statement in my pile of paperwork and realized the charges have gone up 41% since last summer with no change in risk or coverage. I consider more than a 10% increase for anything to be price gouging. I checked online with six other major and minor insurers and couldn't even come close to my renewal premiums, so I was stuck paying up. All I can do is complain to the Florida Dept. of Consumer Affairs, a waste of time, and write about it here.

Upon closer inspection, I realized one of the reasons my rates went up so much is that I wasn't paying as much as most people to start. My mother and I hardly drive anymore, we don't work, don't commute, total mileage is about 3,500 miles a year on her garage kept seven year old Buick LeSabre with automatic theft security and ABS brakes. LeSabre is one of the safest cars as rated by insurers because it is an 'old folks' cruiser. It is covered only for liability and PIP (FL Personal Injury Protection) for the minimum required amounts. We do have comprehensive to cover glass breakage which in FL has no deductible. With all that going for us we still pay 4.7 cents/mile for this minimal coverage. I would image the average commuter who drives 15,000 miles a year pays over $1,200 or 12.5 cents/mile for auto coverage, maybe more with collision (required if the car is financed).

Just think about that the next time you decide to run to the store or go for a drive. Not only are you paying about 13 cents a mile for gas (on 2.87 @22 MPG) but the same amount for insurance and then there's depreciation. Needless to say, that 5 mile run to the store (x2) actually costs $5 in auto expenses. Hertz estimates nearly twice that amount, but they are driving brand new cars which most of us don't. I doubt that one in 100 drivers could correctly estimate the actual cost of driving their own car ten miles to a store and back. If they could, the roads wouldn't be nearly so crowded. Now, don't even get me started on Florida home insurance rates.

BTW, Blogger no longer works with Firefox so I may be switching my blog away from Google. Also, my webpage has been resized to assume 1024x768 resolution. Not everyone uses that default screen setting. These changes suck Google. Get your act together. I refuse to live in a one size fits all IE only world.


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