Pennsylvania Injury Law Report : Pennsylvania Personal Injury Lawyer & Attorney : Stuart Carpey Law Firm : Auto Accidents & Product Liability : Pennsylvania Injury Law Report

By now, you may have heard about those pay-as-you-drive insurance policies which have been growing in popularity. If you don’t know about pay-as-you-drive, or per-mile programs, they are individualized insurance policies geared toward people who don’t drive as much as the average driver. Simply put: if you drive less, you pay less. Depending on a driver’s habits, and the policy purchased, a driver could stand to save $150 a year. The program seems great for people who believe their insurance costs do not reflect the time and miles they spend driving.

In recent years, more and more insurance companies are implementing their own versions of per-mile insurance programs. If you purchase your insurance from one of the big name providers, you might be eligible for this policy. Progressive, for example, offers a “Snapshot” program which the company says can lower a driver’s rates by up to 30 percent. Allstate and State Farm offer similar programs called, respectively, “Drive Wise” and “drive Safe and Save.”

How it works and why it is worrisome:

Though some policies allow for self-reports, meaning a driver submits his or her own miles, the majority of per-mile policies require use of a telematics device which monitors and catalogues driving information, including miles driven. The device, which is used in Progressive and Allstate programs, will also store information regarding a driver’s behavior, such as braking and accelerating patterns, and speeding. Insurance policies may also require a trial period of telematics use before offering a driver the per-mile policy.

As I have blogged about before, the use of telematics devices carries with it the fact of having Big Brother (your insurance carrier) peering over your shoulder as you drive. In theory, usage-based insurance programs seem great, but the data collected by the telematics device could hurt you more than help you. If you hit your brakes often, drive over the speed limit, or go driving after midnight when there is a greater risk of accidents, you might find that you are paying more than you thought you would. And if your insurer decides your driving habits are problematic they could slap you with a sizable surcharge. With this in mind, to call these programs “individualized” seems appropriate since it rests on individuals to decide if the invasion of privacy is worth the potential savings.

While usage-based insurance policies may benefit some drivers, all drivers should know that these policies do not eliminate the need for full tort insurance coverage, including plenty of uninsured motorist coverage and underinsured motorist coverage. For more information on these important coverages order my book Purchasing Auto Insurance in Pennsylvania for useful information on getting the most out of your car insurance.

If you are interested in usage-based programs, you should talk to your insurance carrier or agent to see if you qualify. But make sure you read the fine print; be fully aware of what you are getting into.

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Allstate Insurance Company, one of the the largest insurance companies in the country and certainly in Pennsylvania, is raising rates on Pennsylvania insureds. But here's the kicker. They are only raising rates  on folks who have their homes insured with Allstate; insureds who have  the combination of homeowners and auto coverage are not seeing the same level of increase in their premiums. Here's what Philadelphia Inquirer reporter Harold Brubaker wrote yesterday in his article on the subject.

Allstate Property & Casualty Insurance Co. is imposing an average premium increase of 33.4 percent on the roughly 45,000 Pennsylvania customers who buy only homeowner's insurance from the company. The average increase for customers who insure both their homes and their cars with the division of Allstate Corp. in Northbrook, Ill., is 11.3 percent, according to a filing with the Pennsylvania Insurance Department. The increase was effective for renewals starting May 20.The big jump in costs for homeowners-insurance-only customers prompted Lance Haver, consumer advocate in the Philadelphia Mayor's Office, to buy radio advertisements with his own money warning consumers of the rate increase and advising them to shop around before their renewals kick in. Haver, in an interview Tuesday, called the two-tiered rate increase bizarre. It's as if they think there is "some correlation between your house catching fire and who you insure your car with," he said.

 

Seems to me that this may be a clever, and perhaps devious, way for Allstate to market to their insureds combining homeowners and auto coverage. In other words, when an insured gets the premium increase, and calls his or her agent, the agent will have a script ready to tell the insured how to lower the premium...."buy auto coverage through us!"

The point is, shop around for your auto, and homeowners coverage. I tell clients that all the time. One of the best places to go is the Pennsylvania Insurance Department website.

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What's the first thing the other guy's insurance company representative will want from you after a car accident?  He'll want to take your recorded statement about the accident and your injuries.  He'll also want you to sign a medical authorization so that the insurance company can get all of your medical records all the way back to when you were in elementary school. He might even offer you money to settle your case, and in exchange he'll want a "full and final release."

Some  Pennsylvania accident victims are catching on. When the adjuster asks them for a statement, they turn it around on the insurance adjuster and ask if they can take the statement of the insured driver who was at fault . (Of course the insurance company won't allow that). 

One of my clients (who came to me after she got tired of the shenanigans of a State Farm investigator) told me that when the State Farm investigator started asking her about prior accidents and  injuries, she insisted upon knowing how much bodily injury coverage limits the State Farm insured carried. Now that's clever.

I have another client who told me when the Nationwide adjuster insisted that his car be repaired at a "certified" Nationwide repair shop, my client began asking what type of money on used parts Nationwide would save if the car was repaired at the "certified" repair shop as compared to another auto repair shop not "certified" by Nationwide. At that point the Nationwide adjuster backed off and explained that my client could get the car repaired where he wanted and Nationwide would have to pay no matter what the cost.

Here's the jingles we all hear on television and see in print media.

Allstate: "You're in good hands"

State Farm: "State Farm is there"

Nationwide: "Nationwide is on your side"

Geico has the gecko and the Neanderthal.

Progressive has the catchy TV commercials with Flo. All Flo promises is what the Progressive policy provides for; that is, what the insured paid for.

But, now more than ever consumers need to realize that these companies have no interest in protecting you following an accident. They are profit driven, nothing more and nothing less.

If you're not sure what to do if you've been involved in an accident and the insurance adjuster is knocking at your door, seek out the advice of a qualified personal injury attorney, whether it's our firm or another firm. There are plenty of good law firms in Philadelphia and the surrounding areas who handle personal injury cases. The point is, be smart. Don't rely on what the insurance company is telling you.

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