“White Privilege” in Auto Insurance

[InsCommentary]

Ok so how will that work, Others in lower risk pool will need to pay more to offset those costs.

That's how insurance works in the aggregate. I've been buying insurance for 45 years. In all that time, I've had one claim when a tornado hit my home and, fortunately, did not cause more than a few thousand dollars in damages. I would say that is pretty indicative that I'm low risk, yet I pay over $6,000 a year for personal insurance.

By its very nature, we subsidize each other. One issue with "big data" is that its purveyors purport that it works at the granular level, almost like the movie "Minority Report." At that point, we move away from "insurance" and current products will quickly become unaffordable, like medical insurance has been for those with pre-existing conditions beyond their control.

But I think the issue we're discussing is just simple decency. Not penalizing an old woman because you can or you're "compelled to" by the math. When I had my tornado claim, much of the adjusting was not "by the book" or strictly in accordance with the contract (policy) language. Both I and the adjuster negotiated the claim on a give-and-take basis. The result was a win/win. Even though I'm an insurance policy language wonk, I recognize that there's sometimes more to the process than the literal interpretation of words. As the adage goes, the right do do something does not mean that doing it is right.

 

[vic120]

That's how insurance works in the aggregate. I've been buying insurance for 45 years. In all that time, I've had one claim when a tornado hit my home and, fortunately, did not cause more than a few thousand dollars in damages. I would say that is pretty indicative that I'm low risk, yet I pay over $6,000 a year for personal insurance.

By its very nature, we subsidize each other. One issue with "big data" is that its purveyors purport that it works at the granular level, almost like the movie "Minority Report." At that point, we move away from "insurance" and current products will quickly become unaffordable, like medical insurance has been for those with pre-existing conditions beyond their control.

But I think the issue we're discussing is just simple decency. Not penalizing an old woman because you can or you're "compelled to" by the math. When I had my tornado claim, much of the adjusting was not "by the book" or strictly in accordance with the contract (policy) language. Both I and the adjuster negotiated the claim on a give-and-take basis. The result was a win/win. Even though I'm an insurance policy language wonk, I recognize that there's sometimes more to the process than the literal interpretation of words. As the adage goes, the right do do something does not mean that doing it is right.

not the same thing its because of social justice I have to pay high premiums have to big of the deductible to use them insurance, So someone who doesn't work much nor care too, can go to doc for every little thing.

not because they are lower risk but because of social justice

 

[PhilL]

Isn't it still true that each individual State must approve and disapprove carriers' insurance rates?

 

[InsCommentary]

Isn't it still true that each individual State must approve and disapprove carriers' insurance rates?

There is still some prior approval for personal lines but I believe most states now follow file and use or use and file for commercial lines. That doesn't mean the filings aren't reviewed, as they should be.