Car crash not your fault? FL drivers pay $132 more anyway in study

You are stopped at an intersection. A car runs into your rear bumper.  Great. At least you can be sure your insurance premiums won’t go up, right?

Wrong, shows a Consumer Federation of America study that includes Florida.

Car insuranceMajor insurers charged an average of $132 more to cover a driver not at fault in an accident in Jacksonville, the research found.

It was even worse in Queens, N.Y ($401 more) or Baltimore ($258). There was no change in California or Oklahoma, where regulators forbid charging more after accidents when a driver is not at fault.

Polls show people believe if they drive safely, their annual auto insurance premiums won’t go up,  said Douglas Heller, an insurance expert who helped the consumer group conduct its study.

“They don’t expect they’ll get a rate hike while getting rear-ended at a stoplight,” Heller said.

State Farm did not change rates at all, but Progressive charged 16.6 percent more after not-at-fault accidents in research conducted in 10 markets around the country. Geico (14.1 percent increase), Farmers (11.1) and Allstate (4.8) followed.

Could this make people avoid reporting some accidents — even ones they did not cause — for fear their rates will go up? Insurers urge consumers to contact their agent or claims line in any case, because the insurer may find out anyway through police reports or other means, said James Lynch, chief actuary for the industry-funded Insurance Information Institute.

Placing too many shackles on what insurers can charge in various circumstances can limit competition on price and service, he said.

“One of the things the CFA study does is downplay how competitive the U.S. car insurance market is,” Lynch said. “They found a pretty wide range of what can happen. Some companies said we’re not going to increase you. Others take a different attitude.”

The study looks at coverage for car damage, but Florida throws in another wrinkle related to fault: It requires $10,000 for coverage of minor injuries in accidents regardless of who is at fault.

That’s a case where many drivers have expressed outrage not merely because they have to pay accidents they did not cause — in effect, they pay for accidents they had nothing to do with at all.

Legislators are considering whether to end the Personal Injury Protection requirement in place since the 1970s, but in the meantime, many drivers complain it duplicates health insurance they already have from Medicare or employer plans. Yet it can force them to swallow rate hikes even if they never get in an accident, to cover the general PIP costs in their region.

Florida drivers already pay among the nation’s top five highest premiums. Major insurers have raised PIP rates in Florida 25 percent since the start of 2015.

Average penalty for not-at-fault accidents

Progressive 16.6%

Geico 14.1%

Farmers 11.1%

Allstate 4.8%

State Farm 0%

Source: Consumer Federation of America study released Feb. 13, 2017

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