Chubb Reduces California Auto Rates An Average of 34 Percent

August 23, 2006

The Chubb Group of Insurance Companies is lowering its automobile insurance rates in California by an average of 34 percent. Furthermore, the company said it is rolling out new coverage options including high limits of liability protection in a state where the number of uninsured and underinsured motorists is among the highest in the nation.

The rate reductions will vary based on factors such as driving record and driver characteristics, with some drivers enjoying a reduction of nearly 50 percent. Chubb also has taken other steps to help customers save money. It has doubled to 10 percent its good-driver credit. It has introduced a companion credit ranging from 10 percent to 20 percent off the auto insurance premium for customers who also have a Chubb homeowners policy.

Chubb offers policyholders the highest available liability limits in the insurance industry. Many customers select liability limits of $10 million or higher, and the typical customer will select uninsured/underinsured (UM/UIM) motorist limits up to $1 million. A corporate car personal extension can extend liability and UM/UIM coverage to company cars regularly used by the customer for personal purposes.

“These new liability coverage options are especially important for affluent drivers in a state where a recent study by the Insurance Research Council found that 25 percent of the drivers are uninsured,” said Kurt Morgan, California manager for Chubb Personal Insurance. “What’s even scarier is that uninsured motorists are far more likely to be involved in accidents involving injury.” Mississippi is the only state with a higher number of uninsured motorists (26 percent), according to the study.

“Uninsured motorist coverage is one of the least understood features in an auto insurance policy. It helps protect you and your family against the other guy, who either doesn’t have insurance or not enough of it,” Morgan added.

Additional coverage options now available in California under Chubb’s policy, Masterpiece Auto Preference, provide customers with the opportunity to tailor their insurance to personal and family needs. A customer may have a policy quoted with or without agreed value coverage, which enables a policyholder to lock in a settlement value for a covered loss for a full year. If a car is stolen or totaled in a covered loss, the policyholder will receive that amount, without deductions for depreciation or a deductible. Other coverage options address medical payments up to $100,000, lease gap coverage, full replacement of window glass, towing expenses, and repair or replacement of spare parts for collector vehicles.

Several key coverages will be built into the Masterpiece Auto Preference policy in California, including up to $5,500 loss-of-use coverage. If an insured car is disabled because of a covered loss, the policy can cover the cost of renting a similar vehicle. If a covered loss occurs more than 50 miles away from the insured’s nearest residence, the policy can cover meals, lodging and telephone expenses and even air transportation back home. Standard insurance policies do not pick up many of these expenses and limit rental coverage to $20 to $30 per day for 30 days, or a total of $600 to $900. The policy also affords policyholders:

* the choice of repair shop and original equipment manufacturer’s parts;
* worldwide auto liability coverage, when carrying at least $1 million of auto liability coverage;
* coverage for bodily injury and physical damage when renting a car anywhere in the world and the rental car company’s loss of use of that car;
* replacement of engines, tires, batteries and shocks made necessary by a covered loss without regard to wear and tear; and
* replacement of damaged airbags and locks without the imposition of deductibles.

Like other insurers, Chubb submitted class plan filings with the California Division of Insurance to comply with newly imposed auto rate regulations. For more information, visit

Source: Chubb Group of Insurance Companies

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