Auto Club of Southern California To Cut Rates 7 Percent

July 11, 2006

  • July 11, 2006 at 8:12 am
    rm says:
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    AAA made a pact with the devil. What will AAA do when the hard market hits? Rosenfeld will surely force the next commissioner to honor Garamendi’s sweetheart deal with AAA. When AAA applies for their inevitable rate increase during the next cycle the DOI will put it on the fast track for approval and they will ***** the market because all the other insurance companies who did not kiss Garamendi’s a** will find their rate increases put in the now well used 2year approval lane while AAA sails right through.
    Also, and remember this!! AAA does not pay out medical payments, demanding that the injured party bill their primary medical care. This allows them to be subject to only 33percent subro payment. AAA is a ***** and it will pay. I just hope I’m around to see them fall.

  • July 11, 2006 at 9:31 am
    County Line says:
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    Correction to my earlier remark: The projected AAA premium reduction is $133 million per the I.J. article, not the $134 million I wrote.

    AAA says their customers will pay less, but WHICH customers? Is the $133 mil reduction for just the urbanites? Information about suburban and rural area pricing was pretty much unstated. What is NOT said is often more important in politics and marketing. \”Sell the good points and don\’t talk about the bad\”, is so often the way it goes with desperate sales people. Well, this feels like a desperate sales job by our commissioner and AAA, who appears to be losing market share.

    I did not read anything that said this was a decrease for everyone. Historically insurers talk about \”average rate decreases\”. That has usually meant some consumers pay more and others pay less on filed rate adjustments. It is not rocket science to figure that a small group of insureds (non-urbanites) must each pay a lot more to subsidize a meaningful cost reduction for a larger urban group. From the I.J. article, it appears Mr. Garamendi nor AAA wish to talk about that.

    The more conservative suburban and rural middle class has to be the loser in this battle. Mr. Garamendi knows they are not his voting base, so he can show his reckless disregard for them with political impunity.

    There is another possible side of the story on AAA abandoning the postal zip code rating factor: They can say \”no more zip code rating\” and be technically accurate with those words, but population density maps are readily available to insurers. If AAA stops using zip code risk factors, they can certainly use population density to replace zips. Then they can proudly proclaim they led the market in abolishing the politically demonized zip code risk factor to gain tempory market share.

    If this marketing angle pans out, and Mr. Garamendi is voted to higher office, with victory born on the wings of this sly class warfare, the illusion of \”John Garamendi: Urban Savior\” will be spat upon by those he suckered in.

  • July 12, 2006 at 12:44 pm
    Kegley says:
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    CIGA: Lawyers\’ who worked toward the insolvency of the \”Business Insurance Group\”, that Mr. Cost was so lucky to bring on board \”Foundation Health Corporation.\” 1993.

    Well, THIS is inspiring…still a bargin for Cal-Comp Ins. 1933. Right Paul Decker, Trammel Crow: it was nice to see you step up into the OldCo. Claims deparment liabilty of my left arm worker\’s compensation. I intend to keep the Rancho Cordova office open at existing, H.C.A. Bill Frist levels too, … \”You become what you do,\” the hunted, which I believe this situation offers,\” any objections Kemper spokeswoman Linda Kingman. and saying,and I thought that was a terrific solution to the desire financial solutions, inspired by Malik M. Hasan, M.D. Neurologist. Cutting out my Ulna Bone, damn Saudia Arabian Health & Welfare chump terrorist.

    I notice City to City, Gerry Rafferty Album.

    Code those old records off my closet shelf again, watch for the replay corporate horse\’s ***, 5-11-66, 8-25-88.

    And, Ronald H. Walls how\’d that switch working for you? From CFO of Santa Clara County Health & Hospital System, to Colorado\’s Foundation Health Net. 1987-1995.

    Duck Soup.
    RANCHO CORDOVA
    11171 Sun Center Drive, Rancho Cordova, CA 95670
    P.O. box 2950, Rancho Cordova, CA 95741
    916/859-6300 (Main) · 800/688-3179 · (Toll Free) 916/861-3503 (FAX)

  • July 11, 2006 at 1:03 am
    CA Guy says:
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    It\’s odd that the DOI has posted this announcement because I don\’t see a filing anywhere. Looks like the DOI may have given them a free pass to get by intake.

  • July 11, 2006 at 6:52 am
    County Line says:
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    Politics and class warfare are very comfortable bedfellows under Mr. Garamendi\’s watch. His vote-pandering in the state\’s densely populated areas is blatant as we approach the Fall 2006 elections. His non-territorial rating agenda pits both the urban affluent and the vast numbers of urban lower working class against those living in less densely populated suburban and rural communities. If the urban area premiums decrease, everywhere else must increase. Insurers simply will not accept less money; they\’ll instead spread the risk cost to non-urban areas.

    Mr. Garamendi\’s targeted urban classes potently combine wealthy campaign contributors (ie-Beverly Hills, Bel Air, etc) with the populous lower class voting blocks, which he hopes will propel him to higher office. Of course this is at the expense of CA\’s less populated areas, who simply cannot muster the sheer number of voters nor money to combat Garamendi\’s political ploy.

    At the bottom line, Auto Club says they\’ll collect $134 million less premium from their clients than they do today, while abandoning zip code related risk factors. Insurers are nice folks, but not that nice. Skeptics would ask who is going to make up the premium difference. Count me among the skeptics.

  • July 26, 2006 at 1:56 am
    Mark Brucker says:
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    If they really base rates on mileage and let people know that, then costs should go down more than 7%. The best estimates are that varying insurance by mileage, which makes sense, woud cut driving by 10+%. That should cut collision costs by more than 10%, because each mile a person does not drive cuts not only that person\’s risk by 10%, it cuts risk for all other road users. This would reduce the subsidies that are now given to high-mileage drivers by those who drive less and make insurance more fair and logical. Also cut pollution, deaths, injuries and costs for the medical system and emergency response, which spend a lot dealing with vehicle crashes.

  • July 26, 2006 at 1:59 am
    Mark Brucker says:
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    If they really base rates on mileage and let people know that, then costs should go down more than 7%. The best estimates are that varying insurance by mileage, which makes sense, woud cut driving by 10+%. That should cut collision costs by more than 10%, because each mile a person does not drive cuts not only that person\’s risk by 10%, it cuts risk for all other road users. This would reduce the subsidies that are now given to high-mileage drivers by those who drive less and make insurance more fair and logical. Also cut pollution, deaths, injuries and costs for the medical system and emergency response, which spend a lot dealing with vehicle crashes.



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