Car insurance is a scam, like all insurance. The main reason why insurance is going up though is most likely because the cost of repairing and replacing cars has drastically increased in the last 4 years. Some people buy a used car for 5k and slap a set of wheel and tires on it that cost 2k. I don't know how parts for any car can be almost half the value of the vehicle and somehow be a sustainable market.
this post was submitted on 11 Apr 2024
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What’s the tldr?
tl;dr the entire article is a bunch of propaganda from insurance salesmen who profit from making you think their rate rases are legitimate and not just a cash grab.
But industry insiders and experts I spoke with say there are a few under-the-radar trends also driving rates up, and they relate to the subjects I cover at Vox, so let’s dive in.
All you neeed to know. Its a bunch of bullshit they made up and the "journalist" didn't question. The reality is that all the megacorporations saw the word "inflation" and used it as an excuse to jack up prices.
The key takeaways from the article are:
- Inflation is impacting various sectors, including car insurance, leading to higher premiums for consumers.
- Distracted driving, caused by factors like smartphones, contributes to increased accident rates and insurance claims, further driving up costs.
- Insurers are adapting by implementing new technologies and risk assessment methods to manage these challenges and maintain profitability.
Amazing how if this is to believed they are not only responding to a situation out of their control they are also finding ways to make less money to manage the situation.
If my state didn't force me I'd probably forgo car insurance. I've paid for a decade or more and never had a single claim. Besides my windshield replaced a single time. Total scam like most insurance.
Insurance as a business model only functions when it is on average not worth it.
No. They could invest the money and run off that. Also in practice when there is a national level disaster they get money from the government.
Average american doesn't have $400 saved up for unexpected expenses. Just imagine driving around knowing that at any moment some broke mf is going to crash into you who can't afford to pay for the damage. Personally I'm glad that vehicle insurance is not optional.
What happens when a car hits you? Does their insurance cover it?
Its complicated, but basically yes. The insurance companies determine who is "at fault" and the money comes from that person's insurance.
Yes, but remember that the insurance company makes money by denying claims and minimizing the cost of the claims that they can't deny.
My wife was run off the road by another driver, we had it on her dash cam. All in about 400 dollars worth of damage to her car. The offending driver fled the scene, and we were unable to get insurance information... At first... We paid to have the car repaired out of pocket, since the damage was less than our deductible, and the insurance company started to slow roll our claim. First, they "lost" the case, then they "transferred" it to another agent, then they couldn't locate the owner of the other car, then the owner claims the accident never happened, then their portal was unable to accept freaking video files of the accident... After a lot of digging on our end, we found out that the other driver has the same insurance as us. Suddenly it seemed all the delays, denials and fuckups were intentional, since they would have the both driver and vehicle info in house.
I got hit by a car once and their insurance paid for everything. Even little stuff like a bottle of Tylenol I bought a week later. I imagine they were fine with that since my injuries weren't really that bad and their driver was very much in the wrong.
Doesn't help if they have no insurance.
Can you self-insure?
Based on personal experience, I'd say it's because my oldest just learned to drive.
And I use the term "learned" very generously.
Just kidding, they've mostly stopped stalling at intersections, so it's all good.
There's also this: https://finance.yahoo.com/news/automakers-sharing-driving-data-brokers-102200724.html
Tl;dr: All the connected car stuff is collecting data on you and the data brokers are more than willing to correlate your data and package it all up for insurers, or whoever else wants to buy it.
I am never buying a car with this garbage. When I finally need a new one it will be a cheap imported electric with no headunit
Surely it’s not the advertising budget. When’s the last time any of you saw an ad for insurance? /s
Shout out to the ublock and piracy boys out there struggling not to comment about not seeing an ad for years. I see you fam, you’re appreciated, and it’s okay if you just have to.
To be fair, that’s been a thing for 2 decades. The cost hike is the past 2 years
My insurance company left my state and another company "bought their book of business". My insurance went up by 50%. Switched companies and dropped my rates to near last year's rates but that was mind-blowing to me.
My favorite part is that after the quote they said "it's required for you to fill out this physical paperwork to complete the process." I didn't, because it was getting insurance elsewhere... and they still billed me. I had to call and cancel. Their support didn't understand why I was upset. She just kept telling me they "bought the book of business" whatever the fuck that means.
I keep hearing all these excuses from the insurance industry, usually parroted back to the consumer by reporters. But I have a hard time believing them.
Very anecdotal, but I haven't noticed a tangible increase in bad driving. It's about where it has been for the past 10-20 years. And new cars have more and more safety features built in more. I'm just not seeing anything to warrant the insurance increases - certainly not too the degree so many are facing.
Then there's the excuse about government legislation being the cause. I don't buy that either. Florida has bent over backwards to placate the insurance industry, and the only thing Floridians have got in return is having their wallets totally fucked.
The sniff test doesn't just suggest that the underlying major reason is corporate greed, it reeks of it.
Corporate greed of the insurance companies plays a part, but it is complicated. There is also the skyrocketing size and price of cars driven by auto manufacturer greed (big luxury SUVs and trucks are way more profitable so they’ve mostly quit making small cars) paired with decades of transportation network design that is hostile toward facilitating any mode of transportation outside of autos and also drives preference for larger vehicles.
Our car-first transportation system encourages a snowball effect where having huge cars all around you incentivizes you to upgrade to a larger car because you have no visibility in a small car once half the other drivers have big ones. Additionally, walking and biking become less safe because the cars’ blind spots get huge and you can’t make eye contact to tell if half the drivers see you when you walk/bike through your neighborhood. You also can’t see around large vehicles at intersections to tell if a crossing has anyone else approaching, so you might as well hop in a car instead of trying to get around via cheaper transportation modes. Tearing a hole in your pants by tripping over a dog while walking is cheaper to patch or replace than damage to a car from swerving your vehicle into a pole while attempting not to run over the dog in your path. People are more likely to end up in the latter circumstance when there are no safe foot or bike paths to get around their neighborhood, so that factors into the cost of insurance.
You shouldn’t need a two (or more) ton personal vehicle to safely take care of small local errands, but our cities are designed where that is the safest option. The more weight something has, the more momentum it has at a given speed, requiring a longer stopping distance, reducing your ability to react to hazards in time, and increasing the amount of energy transferred (and the resultant damage) during a collision.
Incentivizing smaller, lighter transportation options would help from both a public safety and insurance cost standpoint because all the safety features in the world can’t negate the basic laws of physics regarding things like momentum and visibility. The hazard large modern vehicles pose to others within their vicinity also suppresses cheaper modes of transit which increases the frequency that expensive vehicles are on the road, leading to even more vehicle collisions and insurer costs. Cars don’t need to be abolished, but they shouldn’t be the only tool we have left in the toolbox, transportation-wise.
New and used car prices are definitely up, so cost of replacement could affect insurance costs. Like everything else the reason is probably, "because we can"