Good-Student Discount Is A Great Way Of Lowering Teen Auto Insurance Premiums

The problem with insuring teenagers is the lack of evidence as to them being responsible drivers. Surely, statistics show that young motorists cause a lot more accidents than older ones. However, there is a way of showing that you take things a lot serious than an average youngster. That is by being a better than average student. Usually drivers between the age of 16 to 25 years of age are considered for good-student discounts. They need to be in full time high school or college education and achieve better than average grades. Then, they can qualify for discounts in the range of fifteen percent. Automobile insurance companies will want proof of commendable success at school. Transcript of grades achieved or confirmation letters from schools will be required. A good student certificate signed by a school official is accepted as well. One of the following achievements will satisfy them in most cases.
Being a good student with average B grade or higher.  By pulling aces on the subjects you are good at you can push up the average.
Being within the upper 20% of the class will be accepted as well.
Making the honor lists and being rewarded for commendable achievement. Keeping your head down and studying to get better marks is a sign of responsible young person. There is an indication that you will not be reckless while driving too. Therefore, risk of accidents for an insurer will be lower comparably that they are happy to offer rate cuts. Some companies specialize on students and can offer a lot more savings than others. However, their saying so is not enough to go with them. Most traditional firms will provide as good discounts as any specialist firm without making much noise about it. The best option is to get several quotes and compare them. The likely savings can vary between fifteen and thirty percent depending on the provider. It would be great motivation for a student if getting a car is dependent on good grades. They would reach two goals when they put a decent effort to do better in exams. Savings for one child would be lovely. However, there are many families across America who have several children at school and like to drive. They could receive a lump sum saving if all their children qualify for rate cuts. Considering a young person would be charged as much as four times of a driver over the age of twenty five, these reductions will go a long way. When they are applied to high premiums, the savings in terms of dollar amounts will be sizeable as well. Therefore, it is not something to ignore when a youngster is capable of achieving those targets. Besides, there is hardly any other way of young motorists getting nice savings. Taking advanced driving courses may be the other option. Other than that they will be facing those rates applied to every other teenager in the country. How else auto insurers will know the difference between a cautious young driver and reckless one anyway?

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What Can Be Done If Car Insurance Premiums Are Stretching The Budget?

When it is already hard to stay within the budget it can be disheartening to receive high vehicle insurance quotes. In these situations, people can react hastily and start chopping and changing their coverage.  Some can totally drop coverage as well. Before taking such drastic actions, there are a few things you can do to lower the rates. If you are only buying the minimum liabilities policy, you will be limited in the way you can play around with the coverage anyway. You cannot reduce the limits and there is no deductible to adjust the premium. The only option might be to see if you qualify for discounts that were missed by the broker or the current insurer. It is always a good idea to give the company a call and ask if there is any chance of some rate reductions. They can only say no. In any case, you should get at least couple of quotes more to compare with rates offered. Every carrier applies different weights on the factors affecting the premiums. So, it will not be surprising at all to get as much as 50% discount from an alternative provider. When you have a full car insurance coverage, there can be a few areas to look for savings. First of all, you should check if you are driving less miles than you have specified last time. You may be working couple of days a week from home or preferring the subway lately. This will reduce the costs depending on how little you are driving. Next, you should look at the open market value of your automobile. Vehicles drop their value considerably with every year passing that at some point it may even be better not to insure them. When the car is worth only few hundred dollars, what is the point in spending similar amount for insurance? You may drop the coverage to bare liabilities if you prefer. A good way of keeping the level of cover you prefer and still cutting the costs is to increase deductibles. Normally, when the deductibles are up the rates come down. You are practically agreeing to cover larger part of the losses you may face. If more money will come out of your pocket when you have an accident, you should pay less at the time of purchasing a policy. There are several other ways of reducing overall insurance costs. First of all, you may want to insure all your automobiles under a multicar policy. Then, you may move your home insurance to the same company as well. Companies usually offer discounts for extra piece of business you give them. Couples can look into having a joint policy as well if they have not already done so. Another alternative is to check if your membership with any organization will offer further discounts. If necessary, you can join the ones that will enable you to get lower premiums. For young drivers, good-student discounts are good ways of cutting the costs. Actually, you can ask the company why you are receiving higher rates. They may point you in the right direction. For example, some companies may charge higher rates for policyholders with bad credit. By finding another auto insurer that does not care much about credit history you can cut the costs as much as 20%. The worst thing you can do is not to do anything and put up with the rate increases while you are already struggling to pay the premium.

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Low Cost Auto Insurance Is Available In California And A Few Other States

California is one of those states with the higher than average unemployment rates. With this in view, families are checking through their monthly expenses a bit more carefully. One of these expenses which is being tried to cut back on is car insurance premium payments. As expenses get more difficult to pay there is a chance that people may choose to go without the required level of minimum liabilities policy. At one point number of uninsured drivers in California reached a staggering thirty percent. Even though it is illegal to drive without the necessary coverage drivers are taking the risk of traffic violations or the suspension of their license. The State of California is aware that drivers are not insuring their vehicles because they simply cannot afford it. Even the California Highway Patrol is aware of the issue. This is the primary reason the state insurance department and other authorities are working together to teach drivers about low cost options. With the new program more drivers are able to get affordable policies and drive legal. According to officials from the City of San Francisco, California low cost auto insurance program offers lower basic liability insurance than the state normally requires. Therefore, it does so at a drastically reduced price. For example, a driver who qualifies for the program would be able to get coverage for their vehicle under $400 dollars a year for $10,000 worth of coverage per individual. Also, they would get $20,000 per accident for bodily injury and $3,000 for property damage liability. This lower than average coverage helps many drivers to have some sort of protection. However, not all drivers qualify for the program. Under state law, drivers can qualify for cheap auto insurance if they are at least nineteen years of age and have a good driving record. They have to have a vehicle that is priced less than $20,000 too. Drivers who hope to qualify for these plans must meet certain earnings restrictions based on their yearly tax returns. A family of two cannot make more than $37,825. These figures for qualification and limits offered may change. Please, check the official website. Previously the earnings where based on a payment stub from their employer. Since the State of California found many where earning more than the amount to qualify through other earnings such as child support payments, earnings from self-employment, or money from dividends, the state changed the policy to a yearly tax return instead of a recent pay-stub. The low cost policies are catching on though. The amount of people enrolling for the program tripled in the year 2010. In the city of San Francisco, the amount of uninsured drivers was reduced from twenty-one percent to less than fourteen percent. The expectation is that by passing on the information about availability of such programs the numbers will continue to fall. The State of California is hopeful about the program too since the costs for uninsured drivers are in the hundreds of millions. According to statistical data, many states the US have an increasing number of drivers without a policy covering their automobiles. As long as the economy does not improve soon it is questionable if the numbers will fall nationwide. The good news is there are other states getting programs that are comparable to the State of California’s cheaper car insurance initiative. Drivers that are considering forsaking insurance to pay other bills should check with their state to determine if there is a cheap auto insurance program available. Quite a few states allow drivers to buy low level of coverage for qualified drivers so that it is affordable. It is better than having to deal with the legal situation with drivers with no car insurance that get into an accident.

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Auto Insurance For 4x4s, Trucks And Other Large Vehicles

Quite a few people in America love 4x4s and trucks even though they may not really have the need for such vehicles. Some of those vehicles never leave the cities or carry a worthwhile load. Motorists keep them because they like them. In some cases they may be preferred as a status symbol. For example, a soccer mom has no need for a 4×4 but in some neighborhoods they all have them. Unfortunately, an insurance company will not consider the point that they are hardly used as an off road vehicle and rather used to carry children to school and back. They will charge the full whack for insuring these vehicles. That can be as much as three times higher than a regular sedan. According to statistics about fifteen percent of cars can be classified as 4×4 or trucks. Those owners will need to watch out. They may need to be innovative to get savings. Probably, the first thing to consider is to decide if you really need such powerful engines and all four wheel drives. If you come to conclusion that you need or you want it anyway, you may want to start looking a bit deeper to find reasonable rates for insuring them. Some people dream to own one of these automobiles. They save and get a loan at the end to own one. For example, a BMW X5 can be the symbol of richness in many parts of the country. However, not all the owners are rich enough not to mind how much they pay on car insurance. They may not be able to do much about the petrol these cars drinks but they can save a few bucks on premiums. It is highly likely that some auto insurers will not be interested in insuring those at all. The problems can be heightened when a younger or otherwise high risk driver involved as well. Even with a great driving history you should be prepared to fork out a lot more for insurance. This will probably surprise someone who has just made the switch from a sedan to high end, large engine vehicle. At this point, drivers should be prepared to shop around until they start getting the similarly low quotes. With the help of internet, it is no bother getting a few quotes in a few moments. You can save hundreds of dollars since the premiums are usually in the thousands. Several high premium offers and no quotes should not discourage you in anyway as these are expected. Perhaps it is a good idea to get quotes from specialist insurers for performance cars, 4x4s or trucks too. There is a chance that they will offer better packages and lower quotes than traditional insurers. But there is no need to just seek them out. Most reputable insurers will be able to take everything into consideration and come up with decent offers. One thing you should be careful is that some brokers may think that since you are driving an expensive car they can get away with charging a little here and there. They may charge you ridiculous amount of money for making changes on your policy or require payment to handle your claims. Stay away from these crooks. If you are already with them, go direct next time or find another brokerage. Another point to mind is the modifications you like to make which can increase the cost of insuring even further. Going for even bigger engines, bull bars, suspensions and body lifts may be cool. However, they will come at steep additional insurance premiums. The best thing is to check before you go ahead and put the works in motion. This will at least give you time to look around for lower rates even if it cannot make you change your mind.

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Understanding And Avoiding The Dangers On American Roads

There are a few misconceptions around why accidents happen. People might think that you have a higher chance of having an accident on the roads you do not know much. However, people seem to have more troubles near home than far away and unknown places. This could be for two reasons. First of all, most driving takes place around home and work. Secondly, people get comfortable and confident in the roads they know. According to statistics America’s roads are becoming safer. Traffic related deaths have fallen to lowest levels in 2010 with a 3% drop from a year earlier. However, almost 33,000 people died following crashes. This number is in no way good news and we have only one life. So, what we should look for on the roadways if we do not want to be another statistic ourselves. One of the key characteristics of accidents in the USA is the fatality rate division between city and country roads. There are a lot more incidents on city roads but they are usually small fender-benders. On the other hand, countryside experiences the most accident related deaths. So, there is a higher chance of having a scrape on urban areas and survival odds are worse in country crashes. Even though they may just be fender-benders singularly those small accidents in the cities can amount to large pay-outs in total every year. Good thing is that things like auto glass damages happen quite often but they are just financial losses. Since the number of them and cost of dealing with them are high auto insurers will pay considerable amounts. This is one of the reasons why city car insurance rates are higher. One of the common places for these small incidents is the parking lots. It is better to avoid parking near the entrances of busy places during busy hours. There will be many people rushing in and out and trying to get into those spaces before anyone else that the chance of your automobile being hit is much higher. City intersections are another statistically significant spots to watch out. In 2008, over thirty percent of crashes happened on busy intersections. These are the locations where the impact of two vehicles travelling in opposite directions can be lethal. Fatal car crashes can be categorized as single-vehicle, two-vehicle and multivehicle crashes. Single-vehicle deadly crashes are most common on highways. On the other hand, two-vehicle collisions are issues common to countryside roads. Countryside has narrow roads with only white markings to separate cars coming opposite directions. A mistake by one of the drivers causes head on collisions and possible fatalities. Multicar pile-ups are more likely to occur on heavily traveled highways and interstate roads. They can happen on metropolitan areas too. So, it is wise to watch your speed and stay awake on highways and look for troubles brewing ahead.  In the same way, keep in mind that it is not enough to be keeping your own lane and minding own road in country lanes. Watch out for other drivers coming from opposite direction and tractors and trucks coming from the sideways. It appears that numbers of fatal crashes are about the same during the night and day. However, there are a lot more cars on the roads during the day than the night and motorists cover three times more miles during the daylight. So, there are more dangerous at night like drunk drivers and drivers who slept at the wheel. They cause a lot more deaths unfortunately and you should watch out for them if you have to travel at night. Again, people might think that wet, rainy and icy conditions will result in a lot more accidents with deaths. The figure is about fifteen percent. So, there are more collision fatalities on dry conditions. This may be because people speed when the conditions are good and they reduce speed considerably when the weather is heavy. Motorists may be more prepared for winter weather with correct tires and so on as well. The last point to mind is the curves. While most of the two and multi vehicle accidents happen on straight roads single vehicle accidents are higher on the curves. This is another area to keep in mind while cruising on your own in a wiggly wormy road.  Keep safe out there.

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Car insurance premiums fall in September

Car insurance premiums fall in September Richard Kilner | September 14, 2012 | 0 Comments Insurance comparison website Tiger.co.uk’s car insurance price monitor Tiger Watch has revealed that premiums in September declined by an average of 4% compared to the corresponding period last year. Car insurance premiums are now the same as they were two years ago, with drivers between 35 and 55 seeing the largest falls, with quotes down by 9-18%. Women drivers are also having a better month, after several months of rising premiums, and male drivers also saw their premiums decline. Month-on-month female drivers saw a 4.7% price decrease, compared to just 1.1% for male drivers. In March women had a 12.4% price advantage over male drivers, but the EU Gender Directive has seen this fall to 1.8% in September (although this is up from August when women had a 1.9% disadvantage). Tiger.co.uk Commercial Director Andrew Goulborn explained that fierce competition was producing good news for motorists as prices continue to fall. Tags: Car Insurance News, Tiger.co.uk Category: Car Insurance News, Insurance News

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LV=’s Britannia Rescue named top provider

LV=’s Britannia Rescue named top provider Gill Montia | August 31, 2012 | 0 Comments LV=’s Britannia Rescue arm has been named the top recommended provider for breakdown cover by Which? The consumer group rated providers on a number of factors including waiting times, quality of roadside repairs and customer satisfaction. In all, 5,772 people who had called out a breakdown provider in the last year were surveyed and two types of cover were judged, third party cover and car manufacturer branded cover. Britannia Rescue achieved an overall score of 73%, meaning it topped the third party cover table while also receiving a top score of 79% for customer satisfaction, equating to a five star rating from Which? The firm’s managing director, Peter Horton, comments: “We pride ourselves on offering an excellent service to our customers so it is great to be recognised as a top scorer for customer satisfaction.” Tags: Britannia Rescue, customer satisfaction, Which? Category: Car Insurance News, Insurance News, LV= News

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Ageas ups anti fraud measures

Ageas ups anti fraud measures Gill Montia | September 3, 2012 | 0 Comments Ageas has signed up to the Syndicated Intelligence for Risk Avoidance (SIRA) anti-fraud database from Synectics Solutions. With application fraud on the rise â€" adding approximately £50 to customer premiums, according to Ageas â€" the insurer is deploying SIRA at the underwriting stage, checking information from new business proposal against known fraud data held by other financial organisations including insurers, banks and building societies. SIRA also allows a claims team to identify third party claimants who have previously been involved in fraudulent activity with any SIRA member, through syndicated data sharing. It will initially be used for Ageas’ motor customers, although the group has plans to launch SIRA for household and travel customers. Commenting on the development, Ageas underwriting director, Adam Clarke, says: “The launch of SIRA will become an important part of our armory against those who intentionally attempt to commit fraud, validating risk data and rewarding honest customers.” Tags: Ageas, fraud, SIRA Category: Ageas News, Car Insurance News, Insurance News

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One millionth uninsured car is seized

One millionth uninsured car is seized Richard Kilner | August 22, 2012 | 0 Comments The one millionth uninsured car on Britain’s roads has been seized by West Midlands police, Bluefin has reported. The West Midlands force has been utilising automatic number plate recognition (ANPR) technology to help it crack down on the uninsured, and has reported an average seizure rate of one vehicle per hour. Since 2005, when the police were first given the right to stop uninsured vehicles, forces across the UK have collectively seized 500 uninsured vehicles a day. There is an estimated 1.2 million uninsured vehicles still on Britain’s roads, however. A spokesman for the AA pointed out that whilst the fine for driving without insurance is roughly £200 the car insurance premium for a young driver can be as much as £3,000, explaining the high rate of both offending and reoffending. Car insurance is not the only area subject to a lack of insurance, with The Co-operative Insurance last month revealing that 18% of British adults lack home insurance. Tags: Bluefin, Car Insurance News Category: Car Insurance News, Insurance News

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Aviva pilots pay-how-you-drive insurance

Aviva pilots pay-how-you-drive insurance Gill Montia | August 14, 2012 | 0 Comments Aviva is proposing to use smartphone technology to create individual driver profiles that will be used to calculate tailored “pay-how-you-drive” premiums. Aviva RateMyDrive, which is about to enter its next trial stage, monitors motorists for 200 miles, including acceleration, braking and cornering. The data is then turned into an individual score which helps determine the motorist’s premium, with safer drivers earning a discount of up to 20%. The insurer’s retail director, Steve Treloar, comments: “We believe this innovative use of smartphone technology will benefit all safe drivers, regardless of age or gender.” He adds: “Unlike traditional ‘black box’ telematics solutions, Aviva RateMyDrive app only needs a small amount of data â€" typically 200 miles â€" to create an individual driver profile.” The app is free to download and uses the customer’s own smartphone, so there is no need for motorists to have a black box installed in their car. So far it has been tested by Aviva staff and the insurer is now looking for 5,000 motorist with android smartphones to complete its research. Anyone interested in taking part can find out more by visiting the company’s website. Tags: Aviva News, RateMyDrive, smartphone technology Category: Aviva News, Car Insurance News, Insurance News

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Motorists beware 1st September

Motorists beware 1st September Gill Montia | August 29, 2012 | 0 Comments AXA is warning that the 1st September has been the worst day of the summer season for motor accidents for three years in a row. Last year saw the biggest spike, with a massive 40% more claims being made than on the average day in the rest of the summer holiday period. This year, 1st September falls on a Saturday and the insurer is predicting that figures may be even higher, as people return home at the end of holidays on the last Saturday of the school summer holidays. Sarah Vaughan, AXA’s motor director says: “We are particularly concerned this year that the ‘bogey’ date of 1st September also falls on a Saturday which is traditionally a big ‘switchover’ day for holidaymakers.” She adds: “We would urge all motorists to take special care driving home and plan their journey to eliminate the stresses that often cause needless accidents.” Axa’s ten top tips for getting home safely are: Leave plenty of time for your journey. Plan your route. Once you know your route use a traffic information provider to check that there are no major problems along the way. Factor in a break if you are on a long journey. Make sure you have games/DVDs at the ready to keep the kids occupied â€" bored children are a big distraction. Keep snacks and drinks in the car â€" dehydration and low blood sugar are not good for anyone behind the wheel. Carry out checks on your car before you leave â€" top up water, oil, tyres and petrol. Check your breakdown cover and motor insurance is up to date and have the numbers readily available. Set your phone to hands free before you set off. If you can be flexible about when you leave, avoid 1st September! Tags: accidents, Axa Insurance News, September, worst day Category: Axa Insurance News, Car Insurance News, Insurance News

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Direct Repair Providers, Steering Laws and Car Insurance

Car insurance companies process about 25 million repair and replacement claims every year. So they’ve got a pretty good grip on which repair shops can be trusted to do good work at a good price. Most insurers these days enter into contractual agreements that designate trusted shops as Direct Repair Providers (DRPs). The insurer recommends its DRPs to its policyholders when they file a claim; the DRPs agree to comply with the insurer’s requirements regarding how to write an estimate, report a claim, which parts to use, what and what not to charge for and other specifications.

The DRP system is  a mutually beneficial arrangement: the repair shop gets a steady stream of business and the insurer is protected from fraud and rising auto repair costs. But what do you, the policyholder, get out of the deal? Is it in your best interest to use the DRP your insurer recommends?

Your insurer has every right to suggest that use its preferred DRP. In many instances, it will be to your advantage because car insurance companies negotiate volume rates with their DRPs that save you and
them money. All well and good. But if an insurer tells you that you must use its DRP, that’s running afoul of anti-steering laws. Steering is the act of directing you to or away from a specific repair shop or requiring
that repairs be made by a specific shop or individual â€" and many states including California and New York now have specific laws on the books prohibiting the practice. Even if your state doesn’t have a specific
anti-steering law, most states already allow you to choose your own auto repair shop. If you feel you’ve been steered, contact your state’s insurance commissioner.

Also be wary of any insurer who tells you that if you take your car to the shop of your choice that you’ll have to pay the difference out of pocket if the labor charges are higher than those of the DRP. Insurers are required by state law to pay any reasonable and customary charge regardless of who performs the work. So use the DRP if you’re happy with the service they offer, but feel free to get estimates on your own and use the repair shop of your choice.

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Fourth of July Safe Driving Tips

While most of us are celebrating our country’s independence, far too many people will be losing their mobility or their lives in needless traffic accidents. The Fourth of July holiday and the travel days
surrounding it are consistently among the deadliest of year on our nation’s roads. Most days, traffic related deaths average 114 nationwide. On the Fourth of July that average spikes to 148.  Hereare some tips to help you avoid the accidents that can trash your driving record, jeopardize your car insurance  and ruin your life.

About 50% of all July 4^th traffic accidents involve alcohol. If you’re hosting a party that includes adult beverages, you could be liable for accidents caused by an over-served guest. Take these precautions:  designate a responsible person to dispense the drinks and alert you to intoxicated guests. Serve plenty of high protein food to slow alcohol absorption. Take guests’ keys at the door and don’t return them if someone appears too drunk to drive. Call them a cab, find a sober guest to drive them home or offer them a guest room instead.

If you’re planning to be on the road for the holiday, plan ahead. Make sure your car is in good working condition. Top off fluids, check the battery, signal lights and tire pressure. If you’re toting a lot of cargo, make sure it’s secured so it doesn’t become a projectile if you have to brake suddenly or are hit by another car. If you’re bringing along a pet, put it in a travel crate anchored with straps or bungee cords, or use a seat belt attachment designed for pets. (And please don't leave a pet or child alone in a hot car; temperatures can soar to fatal levels within just a few minutes.) Plot your route and program your GPS before you head out. Trying to do this while you’re driving is a dangerous distraction.

Drive with your lights on, even in the daytime. This will help make you more visible. Avoid driving at night if at all possible. Most Fourth of July traffic accidents happen after dark.

Sudden summer rain storms can spoil more than the fireworks displays. They mix with oil on the road and create slick conditions. Observe speed limits and don’t tailgate, and exercise extra caution when roads
are wet.

Stay safe and have a happy Fourth of July!

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What Drives the Cost of New Car Insurance?

Once upon a time, you could actually buy a brand new car for about what you'll pay these days for full insurance coverage for a new car. Inflation aside, what exactly drives the cost of insuring a new car?

Unless you paid cash for your new car, you’re financing it and that means you don’t own it. The lender does and your car is collateral on that loan.  If you bang up the collateral and can’t afford to get it repaired, it’s worth a lot less. If it’s stolen, your lender stands to lose everything. So to cover the risk of total loss, your lender requires that you carry comprehensive and collision insurance, over and above the minimum liability insurance required by your state. That means that about 40% of your insurance premium is going to cover
the risk of a damaged or stolen vehicle. Ka-ching!

It costs a lot more to repair today’s cars. If you added up the parts on a $25,000 car, the Alliance of American Insurers estimates the tally would come to $68,000. No wonder, insurance companies often elect to “total” a car that’s been in a severe accident rather than foot the repair bill. Ka-ching!

Anyone who has ever forked over $200 - $300 for a broken headlamp is well aware that even minor fender benders can mean big repair bills. Multipart assemblies and plastic materials used in modern cars can be
easily damaged and are sometimes impossible to repair. So instead of pounding out a ding in your fender, the entire unit has to be replaced. Ka-ching!

If you injure someone with your car, the insurance company will have to foot the medical bills, and health care costs have risen right along with everything else. Plus there’s always the chance in our litigious society that the injured party will decide to sue, meaning your insurance company will have to either settle out of court or finance a defense.Ka-ching!

There are plenty of irresponsible people driving around with no insurance, and many more who are underinsured. If one of them hits you, your insurance company pays. Ka-ching!

Your premium also includes the cost of covering the estimated $24 billion the insurance industry loses every year to bogus injuries, fake damage claims, car arson to get out from under hefty payments
and other fraudulent practices. Ka-ching! Ka-ching! Ka-ching!

If you’re driving a new car and you’re looking for cheap car insurance, your best bet is to shop around for competitive quotes.

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Predictive Modeling and Your Insurance Premiums

Predictive modeling is a analytic process that uses data mined from a variety of sources to create a statistical model of future behavior. Increasingly, it’s being used in the insurance industry to decide what to charge you for almost every kind of coverage from car insurance to life insurance, homeowners insurance and workers compensation. Its use is reported to be up by 10% across all lines of insurance except commercial property/BOP where it remains relatively flat. Basing insurance premiums on predictive
modeling is about as far as you can get from the old days when companies relied on the collective judgment of underwriters and actuaries supported by a smattering of data to decide if you were a good a risk and what to charge to you.  The transition from human judgment to algorithms has a number of obvious advantages for insurance companies, but what are the implications for you, the consumer?

According to a 2012 survey by Towers Watson, of the 69 US and Canadian property and casualty insurers queried, 85% said they are using or plan to use predictive modeling. Most cited improved top- and bottom-line results as the reason. The process improved rate accuracy, had a positive impact on loss ratio and helped retain policyholders at renewal time. All good things for the insurance industry.

Consumers can hope to derive some benefits from this reliance of technology, too. By streamlining the underwriting and claims processes, consumers gain more responsive service. Predictive modeling could
also determine what types of claims drive up costs and what types of claims should be investigated for fraud. Anything that reduces insurance fraud, which costs all of us billions of dollars each year, is a good thing.

On the downside, experts caution that an overreliance on predictive modeling without a solid application of human judgment and business experience could result in too many decisions being made based on “data noise.” As one critic pointed out, predictive models aren’t reality. In her article of the same name, senior director of knowledge resources and ethics counsel at American Institute for CPCU Donna Popow writes that “some aspects of predictive modeling can be concerning.” She points to the widespread use of credit scores to determine auto insurance premiums. Popow rightly points out that a person’s poor credit rating could be the result of the poor economy and have nothing to do with his driving record, yet predictive models would place that person in the pool of people most likely to file a claim, resulting in higher premiums.

The validity of a predict model will always depend on the quality and quantity of the data parsed. As the use of predictive modeling to set insurance rates becomes more prevalent, watch for consumer advocacy groups to demand more transparency about the factors used to justify pricing.

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Hail Damage and Car Insurance Claims

Along with picnics, vacations and reading long novels, summer also means devastating storms like those that recently ripped through Wyoming, Colorado and Oklahoma. The damage done by tornado-force winds gets plenty of press, but the hail stones that accompany these storms cause millions of dollars of property damage each year. Cars are among the hardest hit when big hail stones rain down. Here’s what you need to know to minimize damage and repair the dents.

Hail is not covered by your basic car insurance policy. It is considered a comprehensive claim. Because hail damage falls under the Act of God category, filing a single claim shouldn’t affect your premiums. Filing repeatedly claims might, however.

There’s not much you can do to avoid hail damage if your caught on the road in the middle of a storm. Your best bet is to try to seek shelter under an overpass or head into a covered parking structure. If you’re at home when a storm threatens, pull into your car port or garage and stay off the road until the storm has passed.

If your car is damaged, write down the date and time when the damage occurred. This will come in handy later if there are any disputes about the cause of the dents. Next, contact your insurance company to get the claim process started promptly.

When the adjuster comes to inspect the damage, have your car parked in the shade or inside a garage. Bright sunlight can obscure dents resulting in an inaccurate assessment of the damage.

On average, every dent is going to cost between $50 and $125 to repair. There will also probably be scratch damage to surrounding surfaces that will have to be repainted. Depending on the severity of damage, your hail repair bill could run from $1,500 to over $10,000. The amount of your deductible, the value of your car and its ownership status will determine whether you want to pursue a claim and, if you do, whether you want to pocket the payout or get the repair work done.

The adjuster will write the repair estimate for the Paintless Dent Removal method (PDR), the traditional method or a combination of the two. The PDR method is reputed to do a better job of preserving your
original factory finish and can be completed in a couple of days. The traditional method of pounding out, filing and repainting can take up to two weeks.

You have the right to obtain your own estimates and to use the repair shop of your choice. So once your insurance company has written up an estimate, take it to your preferred shop to see if it adequate. If there’s
a discrepancy, your repair shop can deal directly with your insurer to obtain a re-written estimate or to create a supplement for your insurance company to approve.

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