Guzzi friendly US insurance companies?

[dlaing]

You will be surprised to learn that insurance companies rarely earn an underwriting profit (profit made by taking in more premium than they pay out in claims).

I know for a fact they made an underwriting profit off of me!!!

If they were truly regulated by the government, I don't think the quotes I got would vary several fold. $275 vs $1000+++ per year.

[Garsdad]

Actually, they do vary. I'll try and explain...

 

Company "A" has 3 risk pools. Every person that comes to them gets put in one of the three. I am going to us an arbitrary scale here to assign risk; the theory holds up, but there is no direct real-life application.

 

Group A has people with risk scores of 300 or less, group B has people with risk scores of 301-600, and group C has risk scores of 601 and up. Rates for each of these three groups will be based on the loss history of each group. Not everyone in the group will have a loss, but the whole theory of insurance is to spread the cost of loss among a large pool of similar risk.

 

Your risk score is a 82, so you are in group "A" in company "A" and you get offered their best rates. The company has submitted it's loss data and premiums to the Director of Insurance and the premiums have been approved.

 

Company "B" has 10 categories. Risk scores 1-99 are in group 1, 100-199 group 2, 200-299 group three, and 300-399 group 4, etc. Again, your score is an 82, and you are in their best rate group. However, you are sharing risk (and loss cost) among a better-quality risk pool- in company "A" you were rated with guys with a score of 300; here in company "B" Mr. 300 is in group 4.

 

Same person, two very different rates from two companies.

 

It depends on how the risk are separated, and how the premiums are structured. It is very complex, and underwriters are paid well to make sure they are right.

 

Directors of Insurance will also stop a company from charging too little in premiums to support their expected claims and expenses. An insurer that goes tits-up really creates a problem for their policy holders.

 

Garsdad

[dlaing]

Actually, they do vary. I'll try and explain...

 

Company "A" has 3 risk pools. Every person that comes to them gets put in one of the three. I am going to us an arbitrary scale here to assign risk; the theory holds up, but there is no direct real-life application.

 

Group A has people with risk scores of 300 or less, group B has people with risk scores of 301-600, and group C has risk scores of 601 and up. Rates for each of these three groups will be based on the loss history of each group. Not everyone in the group will have a loss, but the whole theory of insurance is to spread the cost of loss among a large pool of similar risk.

 

Your risk score is a 82, so you are in group "A" in company "A" and you get offered their best rates. The company has submitted it's loss data and premiums to the Director of Insurance and the premiums have been approved.

 

Company "B" has 10 categories. Risk scores 1-99 are in group 1, 100-199 group 2, 200-299 group three, and 300-399 group 4, etc. Again, your score is an 82, and you are in their best rate group. However, you are sharing risk (and loss cost) among a better-quality risk pool- in company "A" you were rated with guys with a score of 300; here in company "B" Mr. 300 is in group 4.

 

Same person, two very different rates from two companies.

 

It depends on how the risk are separated, and how the premiums are structured. It is very complex, and underwriters are paid well to make sure they are right.

 

Directors of Insurance will also stop a company from charging too little in premiums to support their expected claims and expenses. An insurer that goes tits-up really creates a problem for their policy holders.

 

Garsdad

 

Why the vast difference from quote to quote? My quotes must be going from store A group C pricing to Store B group A pricing depending on whether or not Store A scores me a 666 and Store B an 86. Incompetence? or a "sucker is born everyday" strategy?

If, my sales rep is not profiting by offering me insurance for 1000+ per year, is (s)he merely ensuring that (s)he does not get in trouble for grouping me in too preferred of a pool? What is the motivation? the threat of The Director? When quoted outrageous rates should I be negotiating for a better rate? I didn't think that would work!?!

What does the government have to do with it?

Does the government demand that profit cannot be taken from the pools?

[GuzziMoto]

Actually, they do vary. I'll try and explain...

 

Company "A" has 3 risk pools. Every person that comes to them gets put in one of the three. I am going to us an arbitrary scale here to assign risk; the theory holds up, but there is no direct real-life application.

 

Group A has people with risk scores of 300 or less, group B has people with risk scores of 301-600, and group C has risk scores of 601 and up. Rates for each of these three groups will be based on the loss history of each group. Not everyone in the group will have a loss, but the whole theory of insurance is to spread the cost of loss among a large pool of similar risk.

 

Your risk score is a 82, so you are in group "A" in company "A" and you get offered their best rates. The company has submitted it's loss data and premiums to the Director of Insurance and the premiums have been approved.

 

Company "B" has 10 categories. Risk scores 1-99 are in group 1, 100-199 group 2, 200-299 group three, and 300-399 group 4, etc. Again, your score is an 82, and you are in their best rate group. However, you are sharing risk (and loss cost) among a better-quality risk pool- in company "A" you were rated with guys with a score of 300; here in company "B" Mr. 300 is in group 4.

 

Same person, two very different rates from two companies.

 

It depends on how the risk are separated, and how the premiums are structured. It is very complex, and underwriters are paid well to make sure they are right.

 

Directors of Insurance will also stop a company from charging too little in premiums to support their expected claims and expenses. An insurer that goes tits-up really creates a problem for their policy holders.

 

Garsdad

That would explain why one company might charge up to 33% more then another company to insure your Guzzi, but not 300% more. There is a lot ofvariability and profit in the insurance field. They take in more money the they pay out. It's how the business works. I can except that. But you gotta shop around 'cause some companies will charge you alot more then others for reasons only known to them.

[Garsdad]

"Why the vast difference from quote to quote? My quotes must be going from store A group C pricing to Store B group A pricing depending on whether or not Store A scores me a 666 and Store B an 86. Incompetence? or a "sucker is born everyday" strategy?

If, my sales rep is not profiting by offering me insurance for 1000+ per year, is (s)he merely ensuring that (s)he does not get in trouble for grouping me in too preferred of a pool? What is the motivation? the threat of The Director? When quoted outrageous rates should I be negotiating for a better rate? I didn't think that would work!?!

What does the government have to do with it?

Does the government demand that profit cannot be taken from the pools?"

 

 

 

They have very different scoring models. They may have very different non-claims expenses. They have different profit levels. They have different loss experiences based on their mix of bikes and policy holders. and yes, it can mean a difference of 300%. I was quoted by a company that mis-quoted me on my Katana, As a regular, 750 standard I was quoted $973 a year. I bought the policy, then they notified me that they had mis-quoted me (I gave them the VIN for the first quote- this ended badly for them) and my real premium was $3400. I told them to pound sand, got the Oregon DOI involved and got a full refund. The best I could find for it on a real quote was $1470 a year. The price you pay for all that plastic.

 

For some companies, bikes like Yamaha R1 and R6's have a 25% "kill rate"- they are totaling 1 in 4 that they insure. Premiums for those bikes at those companies are going to be very very high, where a company that simply quotes on displacement without a "supersport surcharge" will be much lower. Some companies group vehicle differently. I had several companies rate my Triumph TR-7 the same as a Corvette (two-seat sports car). I insured with one that did not.

 

There are companies that would like to get out of a line of insurance, but they are not allowed to simply exit the market, so they price themselves out of it and let market forces thin their book of business.

 

With the possible exception of banking, there is not a more regulated business than insurance. DOI's have to make sure that premiums are not so low the company goes under. Companies have to make sure they are not so high that they can't sell any in a market they want to be in. It is a balancing act, and one that gets fine-tuned constantly.

 

The best thing you can do is shop around. Don't assume that the company that quoted you a high rate is trying to "rip you off." They may be telling you they just don't want to write bike business right now. Fine. Go somewhere else. That is what a free market (even a heavily regulated one) allows you to do: Choose. The only way an insurance company can "rip you off" is if they fail to pay a legitimate claim. Other than that, if you choose to pay more than you have to because you refuse to make a few phone calls, it is on you.

 

Garsdad

[dlaing]

Thanks for the replies!

I completely agree that it pays to shop around.

Does how you describe a bike effect the rate?

When asked if my bike is a sport bike, I replied that it is a "standard" bike. Then they ask is it a touring bike or a sport bike, and I say it is more of retro sport-touring bike, but if I have to pick one category, I would say it is a touring bike and that it is not a crotch rocket.

I suspect the last statement helps me get a fair rating, that it is more of a touring bike, and not a crotch rocket.

[dlaing]

PS, has anyone noticed if Tonti V11s are cheaper to insure than spines?

[jhh]

Thanks for the replies!

I completely agree that it pays to shop around.

Does how you describe a bike effect the rate?

When asked if my bike is a sport bike, I replied that it is a "standard" bike. Then they ask is it a touring bike or a sport bike, and I say it is more of retro sport-touring bike, but if I have to pick one category, I would say it is a touring bike and that it is not a crotch rocket.

I suspect the last statement helps me get a fair rating, that it is more of a touring bike, and not a crotch rocket.

 

This is what I'm wondering. I just called Allstate back and told them I was buying a Harley BigGiantFancyAcronymWhossname, and the insurance quote was much less (41$ a month) than that of my V11. The agent said that it was based on displacement alone. She couldn't or wouldn't tell me why, only that was "what the computer was telling her".

 

They must have some kind of list in their system that's classifying the V11 as a "litre bike"/crotch rocket, even though they say there isn't.

 

Stupid insurance companies. Damnit, I hate calling these bastards. =(

[Skeeve]

Stupid insurance companies. Damnit, I hate calling these bastards. =(

 

Dairyland, National General/GMAC [Rider magazine's special deal] and State Farm [if you have home & car policies w/ them as well] have all been touted as low-cost moto insurers in the past. I'm w/ Nat Gen right now: just tell them you use your bike for touring [Rider mag's readership] & I don't think they care what kind of bike the manufacturer says it is.