Thanks to claims manager I know at one of the top 20 carriers I was made aware of this recent article from “The Street.” A list of the top 20 strongest auto insurer’s financially were compiled and rated. Click Here, for the full story. The companies listed in this article are profitable and well capitalized.
SAN DIEGO ― With summer vacation looming and many Californians traditionally driving more frequently or longer distances, Insurance Commissioner Steve Poizner warned area drivers to be alert for staged auto collisions. In 2006-2007, 14,565 referrals out of 24,011 insurance fraud referrals received by the California Department of Insurance – 61 percent – were for suspected automobile insurance fraud.
“Insurance fraud is like a $500 tax on every man, woman and child in California, and auto insurance fraud is a major part of this problem,” stated Commissioner Poizner. “Staged collisions are not victimless, even when no one is injured, and an aware public is part of a great defense against these dangerous criminals.”
Nearly $164 million could have been lost by insurance companies in 2006-2007 if the auto insurance fraud wasn’t discovered. Actual loses, however, are subsequently built into the insurance companies’ pricing structures.
In San Diego there were 985 suspected fraudulent claims (SFCs) in 2006-2007. In fact, there were 41 arrests made on one case.
There are primarily three schemes typically used in staged collisions:
People who create these pre-planned accidents, also known as stagers, look for high value targets, such as commercial vehicles, expensive luxury vehicles, and vehicles owned by cities or counties. They are considered “high value” because of the virtual guarantee of insurance coverage.
The following signs may tip-off a driver of fraudulent activity:
If someone suspects he is the victim of a staged collision insist on a police report; document as much information from the collision scene as possible, using a cell phone to take photographs or video; ask the peace officer to positively identify everyone involved, report it to CDI at 800-927-HELP (4357) or go to: www.insurance.ca.gov.
Just think, in the future you may not have to worry about metal or plastic body panels. The future some say might be advanced fabrics that will make up the “body” of your car. BMW just released a concept car just recently based on this methodology. Photos and video by BMW
Click here To see what the future may hold.
California State Senate Bill 1371 which specifically includes the following wording passed committee yesterday 10-0.
“Insurers shall not engage in capping. For the purpose of this section, “capping” means offering or paying an amount that is unrelated to a mutually accepted industry methodology used in determining paint and material charges that is accepted by automobile repair shopsand insurers.”
According to a release today from the ISO. The combined ratio of insurers rose to 99.9 percent in the first quarter of 2008 compared to 91.7 a year ago. This significant rise means that claims will be seen as an area of potential savings for many companies.
The USDOT along with the Integrated Vehicle Based Safety System initiative believe that driver assistance technology systems can reduce accidents by over 1.8 million per year. The focus of the study is specifically rear end collisions. In Germany, there is currently collision avoidance technology being tested actively and in another posting, I provided a link regarding the results. While technology can decrease accidents, there will still be accidents any time the human factor is involved.
Last week in California, SB 1371 was amended. The new amendment is up for hearing next on 6/25/2008
SB 1371:
Existing law prohibits insurers from engaging in specified acts relating to automotive repair. This bill would prohibit insurers from capping paint and materials charges, as defined.
Some of the highlights are:
(a) Today, methodologies that are mutually accepted by both automobile repair shops and insurers are available to determine the cost of paint and related materials. These mutually accepted industry methodologies include manuals and estimating systems that set out the refinish labor units required to paint a particular portion of an automobile, such as a hood, fender, rocker panel, and so forth. The paint and material charge is calculated by multiplying the refinish unit times the refinish rate. Additional mutually accepted industry methodologies that are available involve software programs, which calculate the paint and materials charges. (b) "Capping" occurs when the cost of paint and related materials determined by any of these mutually accepted industry methodologies is ignored by an insurer. For example, a mutually accepted industry methodology determines a cost of seven hundred dollars ($700.00) for paint and related materials, and the insurer, as a standard practice, offers three hundred fifty dollars ($350.00), an amount that is unrelated to the paint and material charges that would be determined by any of the mutually accepted industry methodologies.
The NICB will be providing free to the public, a VIN history search to catch any vehicles that have been determined a total loss by insurers. Click here for more info. According to the NICB this should help keep rolling wrecks off the roads and save lives.
The California bill that deals with insurance code in which no insurer shall require that an automobile be repaired at a specific facility was amended yesterday. Click here for the link.
The National Association of Mutual Insurance Companies joined with other insurance organizations monday in testimony to the U.S. Patent and Trademark office yesterday expressing the concern that patent laws regarding use of aftermarket parts would increase costs to consumers. Click here for more info.
