Insurance Ploy

Joined
Oct 8, 2006
Messages
11,526
Location
OH
I just received a statement in the mail from Geico to notify me that my motorcycle insurance premium (for both bikes, I have two) was increasing. This is their explanation for the increase; "There are many factors that affect your insurance premium such as age, driving history, location, and the increasing cost of vehicle repairs. When one or more of these factors change, it may impact your policy premium." Sounds pretty much like a general statement painted with a broad brush as it doesn't specify any changes to these "factors." Since I haven't had any tickets, accidents, or claims, I'm assuming none of those are factors. I asked my sister about this (she is a licensed State Farm agent with 25+ years in the business). She said 90% of the time these increases are made to keep insurance co. profits as high as possible. She also said they will offer you low premiums to get your business, then jack up your rates later, even when none of the "factors" have changed. This is exactly what Geico did to me. My premiums for both bikes was $210 a year, now they've increased it to $310 a year.

I have my auto insurance through USAA, and I think they've increased my premiums 3 or 4 times over the 25+ years I've been with them, and the increases are usually less than $10 every 6 months. However, USAA doesn't offer motorcycle insurance, they referred me to Progressive. I did an online quote with them and they quoted me $151 a year for both bikes with the same coverages I have with Geico. My current policy is good until 1/15/23, so I will cancel my Geico policy and go with Progressive. So a year from now I will probably be getting quotes from other companies because Progressive will probably pull the same stunt as Geico did...what happened to businesses working to KEEP their customers?
 
A lot of people won't switch. Keeping a customer while jacking his price is the holy grail. If it only works some of the time it is still worth it.
 
They are taking advantage of the present economic situation and raising premiums like all other manufacturers are raising their prices. Time for you to go shopping.
 
They are raising prices because of inflation. I am sure repairs, parts and the like are far more than they were just two years ago. We will all pay for this. The inflation factor has no relation to your driving or claim records.

I don't think "ploy" is the best word to use.
 
Geico did this to me after like 11 years, simply started jacking my insurance by a LOT - like 15-20%. First time I paid since they hadn't raised it in years. Second time I switched, and the agent I went to said the same thing. Its a game they play. If 2 pay and one switches, they win.
 
They are raising prices because of inflation. I am sure repairs, parts and the like are far more than they were just two years ago. We will all pay for this. The inflation factor has no relation to your driving or claim records.

I don't think "ploy" is the best word to use.
Okay, but a 50% increase? I think "ploy" is an accurate description..."gouge" would apply as well...
 
They are taking advantage of the present economic situation and raising premiums like all other manufacturers are raising their prices. Time for you to go shopping.
I did, and I will be switching to Progressive...for now...
 
Why not State Farm? Cheapest isn't always best.
I've requested a call from SF, they don't do online quotes for motorcycle insurance. I've had insurance through Geico, Progressive, State Farm, and USAA, and I know they're reputable companies. I have no problem going with any reputable company offering the lowest premium...
 
Insurance companies take advantage of long time clients because they believe they won't go insurance shoppng.
Luckily, I'm retired now, so I have the time to spend all day looking at quotes. I figure I've been paying insurance premiums religiously for so many decades now, I deserve the lowest premiums. I bet I've paid in 100 times what I've gotten back from them in claims...
 
They are raising prices because of inflation. I am sure repairs, parts and the like are far more than they were just two years ago. We will all pay for this. The inflation factor has no relation to your driving or claim records.

I don't think "ploy" is the best word to use.
But vehicle insurance “payouts” have decreased annd have not inflated and Americans are still driving far fewer miles than before the pandemic.

Despite this reduction in miles, risk and payouts insurance has doubled in some areas while making record profits


Private insurance should be illegal, close down all the bums
 
We’re switching to American Family. Gonna save about $600-700/yr on premiums for same coverage and they do free glass coverage whereas SF doesn’t. House will be about the same but eh.
 
But vehicle insurance “payouts” have decreased annd have not inflated and Americans are still driving far fewer miles than before the pandemic.

Despite this reduction in miles, risk and payouts insurance has doubled in some areas while making record profits


Private insurance should be illegal, close down all the bums
According to the data, miles driven in 2022 is the same as 2019 at 14k. Even in 2020 it was still nearly 13k.

Total cumulative miles driven in 2022 is up 6% over 2021 .


Yet, getting parts and repairs is far more expensive in 2022 vs 2019. This definitely plays a part.
 
Progressive is particularly bad about this. I was only with them for one year, because the 2nd year premium notice had such a shocking rate increase that it got my attention. That's where they're going wrong. They'd be smarter to do smaller increases and just do them every year, rather than smack you in the face with something huge on year two. It may not increase their profits as quickly, but it also won't drive a bunch of customers into the arms of a competitor.
 
Insurance companies take advantage of long time clients because they believe they won't go insurance shoppng.

Absolutely.
In the other recent insurance thread, I posted about an experience I had with my in laws.
They are both pushing their eighties, and have never been what one would call thrifty with their money.
So now after several concerns with money, coupled with some issues about my MIL's health (she has always handled the financials in their household) the three children became actively involved.
Of the three children's spouses, I am known as the one with the best business sense. Thus, I was recruited by Mrs. Tdbo and her sister.
Spent five hours going through everything, and found beaucoup issues. The one that was most glaring was their home/auto policies.
They were married in the early 60's, and had always been with the same companies and even the same agent.
I told the FIL he needed to shop his insurance, and even who to call. He argued about that, however agreed to (I think in an attempt to prove me wrong.)
So he did, and even he was stunned. His homeowners went from $2750./year to $1170., with better coverage. Auto went from $1100. year, to $570.
So definitely, premium creep is a real thing. Yes, many companies benefit from it.
However, the one thing that always fascinates me about these threads is that people generally give their business to the worst offenders of premium creep. Yes Flo's and Gekko's and their stupendously dumb commercials create real overhead, and provide no value.
In many venues there are regional companies that provide real value with competitive rates, with minimal or no premium creep. These companies can be uncovered with a quality independent agent or broker. I have been with my company 29 years, and I shop insurance every two years. After 20, I did a particularly deep dive into shopping rates. The best that I could find (through a "Deal" that they had at the time with my college alum association) would have saved me $50./year combined on both my home/auto. This was with a company that is well known for jacking rates upon renewal. I might add, their initial quote was substantially higher than what I was paying with my company. After they asked who I was with and put me on hold for 15 minutes, they came back with the $50. less. Why would I want to change from a company that was extremely competitive, to one that would stick it to me upon renewal?
I'm all for shopping the rates, but do the deep dive and find a true array of companies. Why keep bouncing back and forth between the Jake's and the Flo's and the Gekko's, when there may be a quality company out there that does not spend tons of money on advertising, jingles, and mascots. The best way to shop is with an independent agent, agents, or broker(s) that know who these companies are, and can present a wide array of quotes.
 
We’re switching to American Family. Gonna save about $600-700/yr on premiums for same coverage and they do free glass coverage whereas SF doesn’t. House will be about the same but eh.
Does AF insure motorcycles?
 
According to the data, miles driven in 2022 is the same as 2019 at 14k. Even in 2020 it was still nearly 13k.

Total cumulative miles driven in 2022 is up 6% over 2021 .


Yet, getting parts and repairs is far more expensive in 2022 vs 2019. This definitely plays a part.
It doesn't justify a 50% increase in rates though...insurance company expenses have not gone up by that much...they are at the very least profit padding, if not outright gouging...
 
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