Analysis highlights disparity in auto insurance prices
Auto insurance in California has been in a turbulent state for the past several months. Last week, the 2012 presidential campaign came to an end, also marking the end of an auto insurance reform bill that had won a great deal of support from the auto insurance industry. The bill was steeped in controversy, but was expected to bring some benefits to consumers in the state and help alleviate some of the problems that exist in the insurance market. A new analysis of the insurance market in California suggests that the problems consumers face are becoming more serious.
People may be paying more than others for identical coverage
The analysis comes from CarInsurance.com, a leading insurance clearinghouse. The organization examined the rates associated with common auto insurance policies in California and found some troubling trends that may be costing some consumers a lot of money. According to the analysis, there is a major pricing disparity amongst consumers, with a large portion of people paying more money than others for identical coverage.
_________________________Random Success Quotes to Remember ~ “People will accept your ideas much more readily if you tell them Benjamin Franklin said it first.” - David H. Comins
Even low-risk drivers fall victim to price disparity
Analysts presented a hypothetical insurance policy, which accounted for $100,000 for injury liability for one person; $300,000 for all injuries; and $50,000 for property damage, as well as a $500 deductible for collision and comprehensive coverage. The owner of this policy, also hypothetical, had a clean driving record and immaculate credit. Analysts found that the average cost of auto insurance in California was $1,428 for such a policy and its driver. The least expensive policies that offer the same level coverage were $960. According to the analysis, such pricing disparity exists throughout the country.
Auto insurance pricing disparity seen throughout the country
Analysts suggest that the disparity exists because no two insurance companies price policies in the same way. The lack of standardization creates pricing schemes that vary wildly from insurer to insurer, thus opening the way for confusion amongst consumers. Analysts note that the price variations are much more pronounced for high-risk drivers, especially in California, where premiums could fluctuate in the realm of thousands of dollars for identical coverage.