Car Insurance

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May not be strictly an alley topic, but I'm sure given the levels of vitriol the topic will generate it's probably best here......

Just hit that time of year where I'm having to renew my car insurance and it always amazes me the arbitrary and petty reasons insurance companies use to justify charging obscene amounts of money for what, in the UK at least is compulsory.

In my case, I'm currently unemployed which apparently means according to the insurance companies that I'm more likely to need a claim and they can therefore justify charging me more money. Since clearly I have so much more money to spend on driving around like a lunatic .

As I do volunteer work, I'm probably going to have to put 'youth worker' down as my employment - That causes it to go from £410 down to £317 so moving from 'out of the question' to 'just manageable'.

Thing is, it's been like this since I started driving. They use any excuse from age to gender to occupation to justify why they can charge stupid amounts of money for what is essentially yet another tax on driving. Strangely enough, they never use anything to justify charging less.

It's reached the point where it's really starting to **** me off.




OK, rant over....

 

Wait a minute - being unemployed in the UK is grounds for increasing insurance costs? Why is that?

 

You tell me....

They base insurance costs, among other things on what sort of job you do. For some reason different jobs cause insurance to cost different amounts allegedly because different jobs are 'more of a risk'.

How they can work out 'Scientist' is less of a risk than 'Youth Worker' which is less of a risk than 'Unemployed' despite it being the same person with the same 'No-Claims Bonus' and the same driving history is beyond me.

Problem is, if you lie about what you do, then its making a 'False Claim' which means your insurance is invalid and you're breaking the law.

 

Yeah, we had a problem with Kevs debit card going missing so his bank did the standard cancelling of all direct debits from his account. Resulting in his insurance being paid three days late that month.

Cue an angry phone call from the insurance company then demanding we paid the next six months of insurance in one go then and there so having to pay £150 instead to cancel the policy at the end of the month...

The upside is the new company is cheaper at least

 

I guess the reasoning why unemployed get to pay extra for insurance is that they're to be blamed for the unemployed state they're in? You know the drill: "Why don't you get a job, then?" So, people who CHOOSE to be unemployed are more unreliable and thus more likely to cause crashes and such.

Although I'm pretty sure such reasoning wouldn't fly here in Sweden. You'd get DO (the agency against discrimination) blowing on your neck pretty much from the word go.

 

Because the amount they can insure me for and make a profit is ~£250 as that is what they quoted me as a 'scientist'. (May be less but I didn't go through every job category to find out). They've therefore gone 'Youth Worker', we'll add £67 to our profit margins. 'Unemployed? Woohoo we can add £160 to our profit margins.

A driver does not suddenly become a worse driver if they change their job. An unemployed driver is not going to be commuting or making un-needed journeys and will be driving more conservatively to save fuel so is actually going to be less of a risk than someone in employment. Clearly something that the price doesn't indicate.

In any other field, this arbitrary ramping up of prices would cause the companies to go out of business as people would refuse to go there. Unfortunately under UK law, car insurance is compulsory.

People have tried arguing here. Insurance companies response? 'Oh we're not discriminating, we're just assessing the risks'. Unfortunately no official body is prepared to take it up.

 

Someone crashed into my car years ago and then drove off. My insurance then classed ME as the risk and put my premium up to £1300 from £600!
I've noticed that as a woman, my premium is lower than my husbands though. Plus having children and working as a volunteer has lowered it. Plus 7 years of no claims has brought it down a Hell of a lot. They do take the p*ss though!
Basically, insurance is a form of gambling you can do at any age

 

It's OK. Someone once made a fraudulent claim against me. My insurance company paid it, admitted they shouldn't have paid but "It's classed as an 'At Fault' claim so you'll have to declare it". Needless to say my premiums went up. Also needless to say that insurance company lost my business.

 

Isn't there a regulator for that sort of thing though?

 

Anything that lowers your credit score will cause your insurance rate to go up. If you are a credit risk you are also a risk for actually making payments on insurance.

 

Per month? That's obscene! I only pay about $1800 [edit: that's a typo - I meant to type $1500] per year for auto insurance, and that's for me and my wife combined, on two vehicles!

Such things exist. As you get older, your premiums go down. (Not that there's anything you can do about your age.) Also, people who are married are statistically less likely to make claims than unmarried people. You're the same person, but when you say "I do", you (apparently) become a better driver. Having a child also reduces the risk. (Although I guess I can see some sense in this - you may be more careful if you have a kid in the car.)

So your solution is simple: If you don't already have one, get a girlfriend. Get her knocked up, and put a ring on her finger, and you'll be good to go.

 

There are other considerations as well ... likelihood of theft and other comprehensive considerations, types and amount of driving (day/night, far/near, roadways), previous claims history, etc. What's your driving record like, Tarrasque?

 

That's annually. Monthly is a whole other kettle of fish as they start charging interest at silly rates on top of it all. Think the one I went with, on a monthly basis would have 20% on top for the priviledge of monthly payments.

Hmmm, have to pay for an expensive wedding and kids to save a bit on car insurance...

Other than the 'at fault' claim already mentioned, I have one (disputed but that's yet another story ) speeding ticket. Thing is I don't mind insurance companies modifying premiums on things like that. They are about how I drive, not how I earn my living, what gender I am and other irrelevant things like that.

 

Possible reason to justify:

Scientist stay inside. They dont travel much beyond the necessary. So the risk is lower in that case.

Youth Worker? Travel muchacho. More risk. But prolly such worker need to have certain mindset that make them more careful onthe road, which is why their risk are lower than

Unemployed. The unemployed must travel everywhere to find work, or have time to travel, etc... plus their mindset is more stressful. Easier to get into accidents.

 

The biggest factors in determining your car insurance are your age, how much you drive, and - most importantly - your driving record. Everything else is secondary. Take two people who are the same age and have identical driving records. If one guy drives 15,000 miles on average each year, and the other guy drives 25,000 miles on average each year, naturally the guy driving 25,000 miles is a bigger risk than the guy driving 15,000 miles each year. The probability of both guys getting in an accident may be the same on a per mile basis, but since the one guy drives a lot more miles, his chance of an accident in a year is more.

Being married, having a child, and being female also result in lower rates, but nothing to the extent of the three factors I listed above. A married 20-year old mother with multiple traffic violations is going to pay a hell of a lot for insurance. The other way to lower your insurance is to drop collision on your car if you're driving a beater. (Meaning that the insurance won't pay to fix YOUR car in accident, but will cover any damage done to the other guys car.)

Tarrasque,

Acknowledging all that, I do not think that something on the order of around £400 per year is excessive. What's the going rate of a pound to a dollar these days? Probably something around $1.50? So you're paying around $600 per year? I was paying about twice that when I was your age, unmarried and no kids. And, assuming you're 20-something, those were my rates 10 years ago. I was paying about $500 every six months, so $1000 per year, and I can only imagine the rates have increased since then.

I currently pay about $1500 per year, but that's two cars and two drivers. Still, that's $750 each, still lower than your rate.

 

I still suffer the same fate. My risk is greater due to theft rates in my area. ('Areas' can be determined as narrowly as your zip code.)

 

Picky, picky. OK, assuming you don't move, those are the three biggest things. Of course you're going to pay more in certain areas. NJ has some of the highest rates in the nation. I have a friend living there, and even though he has a clean driving record and has never been at-fault in an accident, he pays $3000 a year to insure his Camry. When he was living in PA, it was about 1/3 of that.

Granted moving 30 miles seems odd for it to skyrocket. Is there a higher crime rate, or notoriously higher traffic volumes there?