Multinational companies that can navigate Latin America’s unique diversity of cultures, languages, and environmental and policy concerns will be well-positioned to grow their businesses in the region
Demand for Infrastructure Fuels Growth of International Construction Projects
Insurance Choices for Multinationals Vary
Clients in Conflict Areas: Mitigating Risks through Partnership
Spotlight on Africa: Opportunities Abound but Growth Also Presents Risks
Jan. 29--Good drivers with no accidents on their record can end up paying higher premiums for automobile insurance due to the nation's largest insurers using non-driving factors, such as education and occupation, to determine rates.
In its third report on auto insurance premiums charged by major auto insurers, the Washington, D.C.-based Consumer Federation of America found that low and middle income drivers are often unfairly charged higher rates for reasons beyond their control.
Researchers found that in two-thirds of the 60 cases studied, large auto insurers quoted higher premiums to safe drivers than to those who recently caused an accident. And in more than three-fifths of those cases, the premiums quoted to the safe driver exceeded the premium offered the unsafe driver by at least 25 percent.
"State insurance regulators should require auto insurers to explain why they believe factors such as education and income are better predictors of losses than are at-fault accidents," said J. Robert Hunter, CFA's director of insurance and former Texas insurance commissioner.
"Policymakers should ask why auto insurers are permitted to discriminate on the basis of non-driving related factors."
CFA priced policies in 12 major cities using the websites of the nation's five largest auto insurers -- State Farm, Allstate, Geico, Farmers and Progressive -- which together compose more than half of the private automobile insurance market. Pittsburgh was not one of the cities that researchers priced for insurance rates.
The organization compared premiums quoted to two 30-year-old women who had each driven for 10 years, lived on the same street in the same middle-income ZIP code and sought minimum liability coverage required by that state.
But the women differed in several important ways: One was a single receptionist with a high school education who rents, had been without insurance for 45 days and has never had an accident or speeding ticket. The other women was a married executive with a master's degree who owns a home, has had continuous coverage but has an at-fault accident with $800 damage within the past three years.
In every case, Farmers, Geico and Progressive quoted the safe driver a higher premium than the driver who caused an accident. The consumer federation said companies in several cases refused to quote a rate for the good driver, but gave one to the driver who caused an accident.
But in all 12 cities, State Farm charged the good driver less. Also, in all 12 cities, the rates quoted by State Farm were the lowest in six cities and the second lowest in the other six cities.
"If State Farm can give more weight to non-discriminatory driving factors, why can't other insurers do the same?" asked Stephen Brobeck, CFA's executive director.
Tim Grant: [email protected] or 412-263-1591
(c)2013 the Pittsburgh Post-Gazette
Visit the Pittsburgh Post-Gazette at www.post-gazette.com
Distributed by MCT Information Services