Car Insurance: What are your experiences?

Mark Booth7 said:Hey there,

I’ve got a question—it might be a bit off-topic for this thread, but I’d rather not start a whole new one:

So, over the last year, I’ve been in two accidents—both my fault—driving a car registered to an older relative. Now I'm wondering, when I finally go to register a car under my own name, is the insurance company going to hit me with a massive surcharge because of those incidents? This will be my first time actually being the policyholder.

Thanks in advance,

Paul Bishop3 said:If the NAIC has already logged the claims and processed them through your policy, then yes, you're looking at a surcharge. And lately, they've been incredibly fast at updating their records...

Mark Booth7 said:
How can I check on that?

Thanks

Basically, if you had an accident in the same calendar year where you renew your policy after February 1st, the claims history shows up the following year. But if the accident happened before February 1st, it shows up during the current year.

To make it simpler—any crashes you have before February 1st, 2012, will show up when you renew your policies in 2012. Any crashes after February 1st, 2012, won't show up until after February 1st, 2013. I hope that makes sense.

That rule has basically always been the case, unless something changed in the last three months or so.

You can actually check the number of claims on your specific policy at this link:

Occasionally, the total number of claims in the database will show you how many incidents have been officially recorded against you.
And that’s the new system for tracking whether you keep your bonus or not—it's mandatory for all insurers now, mostly just to stop people from jumping to different companies to hide their driving record.
Of course, there are a few loopholes in there, but that's probably a whole different conversation. ☕

Ryan Carter52 said:I guess I'm wondering why he would get a premium increase if he wrecked a car that was actually insured under his dad's name?😕
How could he even get a surcharge if he hasn't even had an insurance policy in his own name yet?

On another note, I might have a question myself, since I was in an accident with my old car—which was registered to me—but that was way back in September 2010.
Now I've been driving this other car for about a year, though it's still on the previous owner's policy which is expiring soon.
I'm curious how those no-claims discounts work, and whether it would affect me at all, since it’s a completely different vehicle and it’s been over a year now.

Best regards,

The person who actually owns the car is the one who's going to take the malus, regardless.

It'll definitely catch up to you.
When you finally go to register a "new" car in your own name, you'll probably need to provide the paperwork from your old policy if you're trying to claim any prior bonus you've earned. And that old policy will clearly show the claim was filed—you can actually check that yourself using the link I posted earlier.

urbanharbor95 said:The person who actually owns the car is the one who's going to take the malus, regardless.

It'll definitely catch up to you.
When you finally go to register a "new" car in your own name, you'll probably need to provide the paperwork from your old policy if you're trying to claim any prior bonus you've earned. And that old policy will clearly show the claim was filed—you can actually check that yourself using the link I posted earlier.

I checked that link above, and there isn't any damage listed—the bonus is still sitting at 50%, even though those accidents happened back in March and August of 2011. Incidentally, the policy renewal was also in March 2011, but that was after the accidents.

The whole issue is that I’d much rather the malus stay attached to the original owner—the guy whose car I'm driving right now—where the premium is roughly $333, which might eventually bump up to $400. If I take the hit with a 0% bonus, I'll be looking at paying about $1000 for my policy, whereas with the malus applied, it jumps to $3,800 or even nearly $5,000 depending on how bad the malus is. That's a massive difference, frankly. Is there any way to influence how this works?

urbanharbor95 said:The person who actually owns the car is the one who's going to take the malus, regardless.

It'll definitely catch up to you.
When you finally go to register a "new" car in your own name, you'll probably need to provide the paperwork from your old policy if you're trying to claim any prior bonus you've earned. And that old policy will clearly show the claim was filed—you can actually check that yourself using the link I posted earlier.

Thanks for letting me know.
I actually had a 0% bonus on my old car, and now I’m sitting at a 50% malus on this current policy, so I guess I'm not really worried about catching a bonus even if one were available. 🙂
What I was mostly wondering about was whether they could just take that malus from my former policy and the old vehicle and slap it onto my new policy just because my name and surname match up.

@Mark Booth7,
I suppose if you just set up the policy in your name for your new car, they might not be able to link you back to the old one, unless maybe the police report specifically listed you as the driver? I wonder if the insurance company even has access to those kinds of documents.
I'm thinking they usually just pin it on whoever the policy is registered to, regardless of who was actually behind the wheel.

Best,

Paul Bishop3 said:Every single insurance company calculates premiums based on the manufacturer's suggested retail price, not the discounted one. Nothing new here. If a dealership gives you a 50% discount, then the car isn't being insured at its actual value. They could practically give it to you for a dollar, but you don't think the collision coverage would cost $3.25 then, do you?

Give me a break. Importers constantly inflate MSRPs just so they can dangle those "special offers" and massive discounts later. They could easily set the base price at $83333 and then flip the car for half that amount. I guess if they did that, how much would you actually end up paying for collision coverage?

northernsurfer64 said:Give me a break. Importers constantly inflate MSRPs just so they can dangle those "special offers" and massive discounts later. They could easily set the base price at $83333 and then flip the car for half that amount. I guess if they did that, how much would you actually end up paying for collision coverage?

AutoNation puts out a catalog with the actual market values for new cars—it isn't influenced by any of those artificial price hikes or fake sales, and most major insurance companies actually use it as the standard when calculating comprehensive coverage.

Ryan Carter52 said:Thanks for letting me know.
I actually had a 0% bonus on my old car, and now I’m sitting at a 50% malus on this current policy, so I guess I'm not really worried about catching a bonus even if one were available. 🙂
What I was mostly wondering about was whether they could just take that malus from my former policy and the old vehicle and slap it onto my new policy just because my name and surname match up.

@Mark Booth7,
I suppose if you just set up the policy in your name for your new car, they might not be able to link you back to the old one, unless maybe the police report specifically listed you as the driver? I wonder if the insurance company even has access to those kinds of documents.
I'm thinking they usually just pin it on whoever the policy is registered to, regardless of who was actually behind the wheel.

Best,

The bonus always stays with the owner of the vehicle, not the driver.
And that bonus follows the driver, not the car once it's been sold.

urbanharbor95 said:AutoNation puts out a catalog with the actual market values for new cars—it isn't influenced by any of those artificial price hikes or fake sales, and most major insurance companies actually use it as the standard when calculating comprehensive coverage.

State Farm actually bases their collision rates on the dealer's invoice, not some catalog... checked it myself!

northernsurfer64 said:State Farm actually bases their collision rates on the dealer's invoice, not some catalog... checked it myself!

Does that same logic apply to used cars? If so, I might just have to buy my wife a car so the collision insurance comes bundled in for free... then maybe I could find a way to lean the costs toward my own vehicle to save a bit of cash...

Thanks!

northernsurfer64 said:State Farm actually bases their collision rates on the dealer's invoice, not some catalog... checked it myself!

The logic here is straightforward: dealers typically offer a discount, making the actual purchase price lower than the sticker price found in a catalog. Consequently, the premium you have to pay ends up being lower 😁 because the valuation is adjusted accordingly, all without needing to tweak the risk coefficient. 😍

northernsurfer64 said:State Farm actually bases their collision rates on the dealer's invoice, not some catalog... checked it myself!

It’s not just them, either—other companies do the exact same thing. Everything seems fine and easy until you actually have an accident or someone steals the car.
If you're significantly underinsured, they basically apply a reciprocity rule when it comes to paying out the claim.
I've looked into that too. 😉

Hey, maybe one of you guys can help me out here:

So, I picked up a used car that’s registered through December, but I haven't officially transferred the title at the DMV yet. We signed the bill of sale last Friday, but I still need to head out to Boise next week to swap the plates and get everything in my name. Well, today, while I was pulling into a parking lot, I accidentally tapped into some guy's brand-new Ford. I dented his bumper, and honestly, the damage looks way more expensive than whatever cash I have sitting in my pocket to settle this right now. We’re heading over to a State Farm office in Silicon Valley to get an estimate and see where we stand.
Here’s what’s actually bugging me, though. Is there any risk for the guy who sold me the car? Since the insurance policy is still technically in his name, could he end up getting hit with a surcharge or a penalty? Also, since this is my very first car and I don't have any prior insurance history, am I going to be stuck paying the full premium when I go to register it in December, or will they tack on a penalty for this accident right away? And if they do, how bad is it going to hurt?

Taylor Swift

darkranger232 said:Hey, maybe one of you guys can help me out here:

So, I picked up a used car that’s registered through December, but I haven't officially transferred the title at the DMV yet. We signed the bill of sale last Friday, but I still need to head out to Boise next week to swap the plates and get everything in my name. Well, today, while I was pulling into a parking lot, I accidentally tapped into some guy's brand-new Ford. I dented his bumper, and honestly, the damage looks way more expensive than whatever cash I have sitting in my pocket to settle this right now. We’re heading over to a State Farm office in Silicon Valley to get an estimate and see where we stand.
Here’s what’s actually bugging me, though. Is there any risk for the guy who sold me the car? Since the insurance policy is still technically in his name, could he end up getting hit with a surcharge or a penalty? Also, since this is my very first car and I don't have any prior insurance history, am I going to be stuck paying the full premium when I go to register it in December, or will they tack on a penalty for this accident right away? And if they do, how bad is it going to hurt?

Taylor Swift

He won't lose his discount because you handled the bill of sale through JPMorgan Chase, which serves as proof the car was sold; he'll be fine. What people often mess up is failing to pay those extra $7.25 at JPMorgan Chase to notarize their copy of the contract. Without that notarization, the agreement might not even hold up if things go sideways.

If you haven't had your own car or policy before, things aren't looking great. You'll likely start with a massive surcharge, maybe 50%, so that policy could end up being incredibly expensive.

If you previously held discounts of 50, 40, 20, or 15%, then every accident clips 15% off. So, if you'd built up a 20% discount, you'd drop down to 5% after this... if you had 50%, you'd fall to 35%, and so on...

His policy would actually take the hit if he had just given you power of attorney (which is how most shady dealers operate), and that's why I'd never sell a car via power of attorney to anyone.

I wonder if there’s any way to dodge that surcharge when you're setting up your first policy? I know they don't do that 50% discount thing anymore, but maybe there's some way to lower the penalty or something... I guess I'm just guessing here

Tyler Price7 said:I wonder if there’s any way to dodge that surcharge when you're setting up your first policy? I know they don't do that 50% discount thing anymore, but maybe there's some way to lower the penalty or something... I guess I'm just guessing here

Unfortunately, NO. There's no more maneuvering left...

If you didn't register the car under your own name for tax purposes... there's actually a chance it might just stay in his name...

James Nelson8 said:If you didn't register the car under your own name for tax purposes... there's actually a chance it might just stay in his name...

But if there's a notarized bill of sale, all that goes out the window; then this guy will just end up owing the IRS interest.

When selling a vehicle, always make sure to $7.25 and get your copy notarized if the registration isn't canceled and transferred on the same day.

fadedlynx6 said:But if there's a notarized bill of sale, all that goes out the window; then this guy will just end up owing the IRS interest.

When selling a vehicle, always make sure to $7.25 and get your copy notarized if the registration isn't canceled and transferred on the same day.

Man, I'll just report it to the IRS and pay everything off. But since I'm missing that 50% discount, I guess I might have to set it up as a gift, though even then I’d probably owe a 5% tax. I'm not exactly a genius, you know? So does that mean I gotta pay for insurance through $1667 first, and then wait like four years to hit that 100% no-claims bonus? Kind of a bummer, since the damage on my other car was barely anything 😢

Tyler Price7 said:Man, I'll just report it to the IRS and pay everything off. But since I'm missing that 50% discount, I guess I might have to set it up as a gift, though even then I’d probably owe a 5% tax. I'm not exactly a genius, you know? So does that mean I gotta pay for insurance through $1667 first, and then wait like four years to hit that 100% no-claims bonus? Kind of a bummer, since the damage on my other car was barely anything 😢

So, how much of a deficit are you actually running in total?

fadedlynx6 said:So, how much of a deficit are you actually running in total?

Insurance folks told me my deductible is 50%, but I guess I don't really know the actual dollar amount for damage that bad on someone else's car.