[Kolyan2k]

Originally Posted by zx10guy

This whole discussion about comparing insurance rates is useless unless people also divulge their coverage limits and deductibles. I can say my $500 collision and $250 comprehensive deductible with $250/500k liability limit coverage is going to be very different than someone doing the a $1000 deductible with the state minimums for liability coverage.

This thread is not about comparing peoples insurance rates lol

[xQx]

Originally Posted by Kolyan2k

Never noticed before.....this is 1st time. I thought thats how insurance companies work, you dont have any claims they make money, you have a claim (where no other insurance is involved) they loose money. Didnt think they want to recover their $1000 loss by increasing my insurance $700 per year. Thats not exactly a recovery, they will be making money on me next year. Not a great way to reward a good driver

Yes & no.

Insurance companies are in the business of spreading risk and making money. It doesn't matter if it's auto, house, contents, business or life insurance.

The formula is simple: Your Annual Premium is greater than the frequency they expect you'll be making a clam multiplied by the average size of that claim.

(of course, estimating your risk and size of claim is far from simple)

The easiest way know what they think of you, divide the value of your car (say $40k) by your premium (say $1k) and you know they think you'll write off your car less than once every 10 years.

There's one other factor, profit. They want a surcharge for taking this risk away from you, so your premium is always going to be more than your (risk * av payout). How much profit they make from you depends on how much competition they have - basically how much they think you'll be willing to pay.

So it's not as simple as "we paid you out, so we're trying to make that money back". But it probably is as simple as "even though it's not your fault, our statistics say that people who have that particular type of no-fault accident go on to make more claims in future."

It's one of the few industries where off-limits discriminatory metrics (eg. Age, Sex, Race, Education, Postcode, not-at-fault accidents, speeding tickets etc.) can be taken into account to calculate your risk.

So while the answer might be offensive: Your insurance company thinks your behavior contributed to your no-fault accident; your reaction is simple: Shop around. Since you're not at fault you probably don't have to disclose it to other insurance companies. You'll get your no-claim premium back.

[Kolyan2k]

Switched to Safeco. Basically got same rate as last year from Allstate without that $6-700 price hike