You could be paying twice as much for car insurance as a similar Tucson driver
The rates major insurers charge local motorists are all over the map, with some charging hundreds or thousands of dollars more than others -- in some cases more than double -- for the same coverage, data on file with the state insurance department show.
An 18-year-old single woman with a clean driving record, for example, can pay anywhere from about
A married couple with clean driving records can pay between
Similar price spreads were also reported for several other types of customers in this year's annual state sampling.
Geico consistently charged the lowest rates, and Farmers the highest, with the others falling somewhere in between.
What accounts for the steep variations?
"Each company has their own secret sauce, their own way of slicing and dicing the data," Hair said.
"Everyone has their own algorithm that uses different actuarial indicators. For example: are you married? Do you have a checking account? Do you own a home? They're all trying to find the magic formula that will bring them the best price for that risk."
Credit ratings, education levels and ZIP codes can also figure into the rates insurers charge.
So can the level of customer service a company provides.
For example, while Geico offers the lowest rates, it has the highest rate of customer complaints: about one complaint for every 8,000
"Auto insurance rates throughout the country make no sense,"
"The extreme dispersion of prices for identical risks means that market competition is not working to assure prices are reasonable."
"The wide range of prices demonstrates a very competitive market," he said.
"Some customers might want the cheapest coverage, some might want the best customer care.
"We put out the comparisons so people can make an informed decision. What they choose is up to them."
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