Car Insurance; Bad Driver Penalty

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Topic Author
Leesbro63
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Car Insurance; Bad Driver Penalty

Post by Leesbro63 » Mon May 11, 2020 1:55 pm

A family member had a bad accident last summer in his new luxury car insured by Chubb. It was his fault. His car was fixed to the tune of about "only" $10,000, but on top of that the guy he hit sued and got a settlement as well as a car repair. To add to the misery, during my family member's car repair period, this same family member was hit and the rental car was totaled. The other driver was deemed at fault for this second accident, but it's not clear how Chubb views the whole situation.

As predicted, the insurance premium went from about $3500 to about $6000 per year. Call it a $200/month penalty. So far, other insurers won't even look at him.

Two questions:

1. How long will he be paying the penalty, assuming no more accidents?

2. Is there some other alternative he's missing, besides taking the bus?

Mako
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Re: Car Insurance; Bad Driver Penalty

Post by Mako » Mon May 11, 2020 2:07 pm

My insurer adds surcharges for moving violations and accidents, and says that surcharges are applied for 36 months.

I note that many car insurance things are state specific, so YMMV.

Afty
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Re: Car Insurance; Bad Driver Penalty

Post by Afty » Mon May 11, 2020 2:19 pm

Leesbro63 wrote:
Mon May 11, 2020 1:55 pm
2. Is there some other alternative he's missing, besides taking the bus?
Uber or Lyft? I’m serious. $6000 pays for a lot of rides.

Millennial
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Re: Car Insurance; Bad Driver Penalty

Post by Millennial » Mon May 11, 2020 2:26 pm

Are there other incidents on his record? Wife and I drive a lot of miles, have new cars (and hers would fall into the "luxury" category). We live in a major city. Our car insurance is only $1200 per year combined... I can't imagine why it was $3500 per year before the accident unless there are some priors, or that's one heck of a luxury car!

Only advice I can offer is to look into raising the deductible?

Topic Author
Leesbro63
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Re: Car Insurance; Bad Driver Penalty

Post by Leesbro63 » Mon May 11, 2020 2:34 pm

Millennial wrote:
Mon May 11, 2020 2:26 pm
I can't imagine why it was $3500 per year before the accident...
One word: Chubb

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mmmodem
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Re: Car Insurance; Bad Driver Penalty

Post by mmmodem » Mon May 11, 2020 2:52 pm

The penalty is ~36 months depending on when the mishap happened during our renewal cycle. YMMV. We chose to buy a clunker and assign the vehicle to the bad driver (me) liability only insurance. Most of the increase was for comprehensive and collision coverage. The other drivers on the plan were not affected on the premium. Insurance agent indicated that they rate whoever is highest risk as the driver. In fact, insurance went down after purchase of the clunker because the bad driver is no longer being rated on the full coverage vehicle.

hookemhorns
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Re: Car Insurance; Bad Driver Penalty

Post by hookemhorns » Mon May 11, 2020 4:12 pm

I'm assuming they have comprehensive coverage at that premium? They should consider dropping down to liability only. $3500/year already seems very high, $6k is crazy and it might be worth it just to uber everywhere instead.

For reference, we have liability only on two vehicles and pay ~$750/year for $500k coverage.

TropikThunder
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Re: Car Insurance; Bad Driver Penalty

Post by TropikThunder » Mon May 11, 2020 7:20 pm

Leesbro63 wrote:
Mon May 11, 2020 2:34 pm
Millennial wrote:
Mon May 11, 2020 2:26 pm
I can't imagine why it was $3500 per year before the accident...
One word: Chubb
Then why use them?

quantAndHold
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Re: Car Insurance; Bad Driver Penalty

Post by quantAndHold » Mon May 11, 2020 10:39 pm

Have they shopped around for a better rate?
Yes, I’m really that pedantic.

Topic Author
Leesbro63
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Joined: Mon Nov 08, 2010 4:36 pm

Re: Car Insurance; Bad Driver Penalty

Post by Leesbro63 » Tue May 12, 2020 11:21 am

TropikThunder wrote:
Mon May 11, 2020 7:20 pm
Leesbro63 wrote:
Mon May 11, 2020 2:34 pm
Millennial wrote:
Mon May 11, 2020 2:26 pm
I can't imagine why it was $3500 per year before the accident...
One word: Chubb
Then why use them?
Chubb is considered the "Cadillac" of property/casualty insurance. The premium, even before all this, was double what others charge. Some people think it's worth it. Truthfully they took a long time to approve the various levels of repair to my relative's car. It did not seem like he got premium service. But, in theory, you're buying a better product with Chubb.

Topic Author
Leesbro63
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Re: Car Insurance; Bad Driver Penalty

Post by Leesbro63 » Tue May 12, 2020 11:22 am

quantAndHold wrote:
Mon May 11, 2020 10:39 pm
Have they shopped around for a better rate?
So far no one will take him due to the two accidents. Truthfully I wouldn't insure someone with two big accidents either, if I was in that business.

NewMoneyMustBeSmart
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Location: Midwest

Re: Car Insurance; Bad Driver Penalty

Post by NewMoneyMustBeSmart » Tue May 12, 2020 11:02 pm

Leesbro63 wrote:
Tue May 12, 2020 11:21 am
But, in theory, you're buying a better product with Chubb.
“In theory, theory and practice are the same. In practice, they are not.” - A. Einstein
-- | Few are those who see with their own eyes and feel with their own hearts - Einstein

SR II
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Re: Car Insurance; Bad Driver Penalty

Post by SR II » Wed May 13, 2020 12:03 am

Afty wrote:
Mon May 11, 2020 2:19 pm
Uber or Lyft? I’m serious. $6000 pays for a lot of rides.
And $6k/yr is just the price of insurance; not vehicle payments, servicing, fuel costs and parking!

If this is a young male driver, the price will be high until he reaches age 25 for many companies and also for three to five years, when the accidents fall off his insurance record.

core4portfolio
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Re: Car Insurance; Bad Driver Penalty

Post by core4portfolio » Wed May 13, 2020 12:11 am

Take defensive course and see if your points goes down
Ask insurer if they have safe driving device on dashboard to reduce the premium.
If geico, buy 1 BRK-B stock will give discount as share holder
Shop around for better price.

Change the policy before expiry and also try to do it online quote.
If costco member, check with them to see pricing.
Bundle up --> umbrella policy
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furwut
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Re: Car Insurance; Bad Driver Penalty

Post by furwut » Wed May 13, 2020 9:57 am

Leesbro63 wrote:
Mon May 11, 2020 1:55 pm
Two questions:

1. How long will he be paying the penalty, assuming no more accidents?

2. Is there some other alternative he's missing, besides taking the bus?
3 to 5 years depending on severity of claim and insurer. One can ask the agent.

Bus is not a bad choice but the type of vehicle one drives can make a difference too. A nice safe boring mini-van perhaps?

UALflyer
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Re: Car Insurance; Bad Driver Penalty

Post by UALflyer » Wed May 13, 2020 6:42 pm

Leesbro63 wrote:
Tue May 12, 2020 11:21 am
TropikThunder wrote:
Mon May 11, 2020 7:20 pm
Leesbro63 wrote:
Mon May 11, 2020 2:34 pm
Millennial wrote:
Mon May 11, 2020 2:26 pm
I can't imagine why it was $3500 per year before the accident...
One word: Chubb
Then why use them?
Chubb is considered the "Cadillac" of property/casualty insurance. The premium, even before all this, was double what others charge. Some people think it's worth it. Truthfully they took a long time to approve the various levels of repair to my relative's car. It did not seem like he got premium service. But, in theory, you're buying a better product with Chubb.
Chubb typically does not just issue auto policies, as they also want to issue HO (and have specific requirements for those), umbrella, etc... Assuming that this is, in fact, the situation here as well, it would not be unusual for the auto policy to be relatively expensive, but for the overall policy premiums to be highly competitive.

TropikThunder
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Re: Car Insurance; Bad Driver Penalty

Post by TropikThunder » Wed May 13, 2020 7:13 pm

UALflyer wrote:
Wed May 13, 2020 6:42 pm
Leesbro63 wrote:
Tue May 12, 2020 11:21 am
TropikThunder wrote:
Mon May 11, 2020 7:20 pm
Leesbro63 wrote:
Mon May 11, 2020 2:34 pm
Millennial wrote:
Mon May 11, 2020 2:26 pm
I can't imagine why it was $3500 per year before the accident...
One word: Chubb
Then why use them?
Chubb is considered the "Cadillac" of property/casualty insurance. The premium, even before all this, was double what others charge. Some people think it's worth it. Truthfully they took a long time to approve the various levels of repair to my relative's car. It did not seem like he got premium service. But, in theory, you're buying a better product with Chubb.
Chubb typically does not just issue auto policies, as they also want to issue HO (and have specific requirements for those), umbrella, etc... Assuming that this is, in fact, the situation here as well, it would not be unusual for the auto policy to be relatively expensive, but for the overall policy premiums to be highly competitive.
Maybe if they threw in homeowner's and umbrella for free?

UALflyer
Posts: 618
Joined: Thu Jan 17, 2013 10:42 am

Re: Car Insurance; Bad Driver Penalty

Post by UALflyer » Wed May 13, 2020 7:22 pm

TropikThunder wrote:
Wed May 13, 2020 7:13 pm
UALflyer wrote:
Wed May 13, 2020 6:42 pm
Leesbro63 wrote:
Tue May 12, 2020 11:21 am
TropikThunder wrote:
Mon May 11, 2020 7:20 pm
Leesbro63 wrote:
Mon May 11, 2020 2:34 pm


One word: Chubb
Then why use them?
Chubb is considered the "Cadillac" of property/casualty insurance. The premium, even before all this, was double what others charge. Some people think it's worth it. Truthfully they took a long time to approve the various levels of repair to my relative's car. It did not seem like he got premium service. But, in theory, you're buying a better product with Chubb.
Chubb typically does not just issue auto policies, as they also want to issue HO (and have specific requirements for those), umbrella, etc... Assuming that this is, in fact, the situation here as well, it would not be unusual for the auto policy to be relatively expensive, but for the overall policy premiums to be highly competitive.
Maybe if they threw in homeowner's and umbrella for free?
You're reacting to the $6K auto premiums, but we know nothing about the vehicles involved, the profile of the insured, their location, or any other policies involved. I can guarantee you that we aren't talking about a 10 year old Toyota Corolla and Nissan Sentra and two married middle aged drivers living in a little house in the middle of nowhere.

There are plenty of situations where Chubb ends up offering the best policy premiums out there. Just like with every other insurer, however, there are also plenty of situations where switching to another carrier would've saved the person quite a bit of money.

illumination
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Joined: Tue Apr 02, 2019 6:13 pm

Re: Car Insurance; Bad Driver Penalty

Post by illumination » Wed May 13, 2020 7:27 pm

I know in my state, you can post your own bond instead of carry auto insurance, but that's obviously taking a whole lot of risk. And you're taking that risk on someone that has shown they have a lot of accidents.

Definitely shop around though, it's pretty staggering how much car insurance can vary. This person was paying a crazy rate before the accident. I use Geico and I like them, just like the jingle says, you can get a quote really quick. I couldn't find anyone lower. When I have used them for things like a break-in for a window, I found them to be easy to work with. I could never see myself paying a substantial premium for "Cadillac" car insurance.

UALflyer
Posts: 618
Joined: Thu Jan 17, 2013 10:42 am

Re: Car Insurance; Bad Driver Penalty

Post by UALflyer » Wed May 13, 2020 7:46 pm

Leesbro63 wrote:
Mon May 11, 2020 1:55 pm
A family member had a bad accident last summer in his new luxury car insured by Chubb. It was his fault. His car was fixed to the tune of about "only" $10,000, but on top of that the guy he hit sued and got a settlement as well as a car repair. To add to the misery, during my family member's car repair period, this same family member was hit and the rental car was totaled. The other driver was deemed at fault for this second accident, but it's not clear how Chubb views the whole situation.

As predicted, the insurance premium went from about $3500 to about $6000 per year. Call it a $200/month penalty. So far, other insurers won't even look at him.

Two questions:

1. How long will he be paying the penalty, assuming no more accidents?

2. Is there some other alternative he's missing, besides taking the bus?
The answer to the first question is fairly easy: depending on the state and the insurance company, 3-5 years (even if it's 5 years, it's not usually as significant after the first 3 years).

The answer to the second question is complicated, as we don't know anything about the overall situation. For instance, are there any minors on the policy? How "luxury" are the vehicles and how many? Are we talking about a $40K semi-luxury sedan or an exotic sports car? Have any of the drivers had any other claims or infractions. My assumption here is that there's also a high value homeowner's policy involved, in which case the question is whether Chubb would even allow them to split up the policies or ask them to move the entire relationship.

livesoft
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Re: Car Insurance; Bad Driver Penalty

Post by livesoft » Wed May 13, 2020 8:14 pm

We had the situation where we did not own a car for a few years. Then we got another car and our previous insurance company, USAA, wanted to charge double the going rate since we had not had auto insurance in a while. That is, they were treating us like a newly licensed driver. I only say this to note that one may not escape from eventual high rates by using a ride service.
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randomguy
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Re: Car Insurance; Bad Driver Penalty

Post by randomguy » Wed May 13, 2020 10:48 pm

Millennial wrote:
Mon May 11, 2020 2:26 pm
Are there other incidents on his record? Wife and I drive a lot of miles, have new cars (and hers would fall into the "luxury" category). We live in a major city. Our car insurance is only $1200 per year combined... I can't imagine why it was $3500 per year before the accident unless there are some priors, or that's one heck of a luxury car!

Only advice I can offer is to look into raising the deductible?
Things are also. very, very regional. Go look at the rates for Michigan for example. They are 2x the national average fo the the same car and driver. Individual situations can make the differences even greater. And without knowing if we are talking a 50k luxury car or a 150k luxury car, I am not sure what the rates from another provider would have been precrash. I would have expected more like a 30-50% increase but maybe this counts as a 2 incidents.

I suppose you could double check if there is some type of accident forgiveness if you have been there a long time with a clean record.

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