Major auto insurance companies out of California

Many insurance companies are pulling back from the California market because they say our drivers are too expensive to insure.

Californians are driving as much as they were before the pandemic, but it doesn’t seem to be good.

Car accidents are happening and some insurance companies are claiming that they are paying more than what they are paying.

From 2020 to 2021, auto insurance losses increased by 25% while premiums increased by 4.5%, according to the American Property Casualty Insurance Association. The rate and severity of traffic accidents are high and so are the costs.

“The cost of paying off a car is 33% and the cost of a new car is 11%,” said Denny Ritter, American Property Casualty Insurance Association.

In California, some insurers have not seen a rate increase approved by the insurance commissioner in over 3 years.

“What we have seen is that you have insurers that are paying more in claims than they are using in payments.

California is a consumer friendly state and insurers must justify any increase. State Farm, AllState and Farmer’s are asking the California Department of Insurance for a nearly 7% increase. Progress is asking for more than 19%. According to a local representative, the insurers are making it difficult for him to get new cars.

“They might ask you to pay in full instead of having a payment plan. Right now, every carrier I can think of has restrictions. They’re basically saying, don’t write please,” said Karl Susman from Susman Insurance.

Geico has closed all of its California offices and Progressive has stopped advertising in the state.

“State farms, you can no longer get information by calling them, you have to go to the representative office,” Susman said.

A spokesman for the Insurance Commissioner said “while insurance companies are focused on raising prices, the Department of Insurance is focused on protecting drivers and helping them get more value for their premiums. .”

According to his office, the commissioner saved Californians $2.4 billion in reduced wages during the height of the covid stay-at-home – when the industry still received a total of $42 billion in excess revenue. .

Insurers can’t refuse to pay Californians because we’re the so-called “carry all market,” but agents say they should go with smaller cars, if needed quickly. insurance.

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