State Farm renewal raises my Super Sport rate 275% on BMW

[Rossi86]

Forum Sponsor

Why should drivers with decent driving/riding records operating proven lower-risk vehicles subsidize the insurance rates of those who have poor driving/riding records who choose to operate vehicles with a proven high rate of claims?

Because this is the only way insurance works! If everyone paid for their own expenses you wouldn't need insurance, would you? Using your reasoning, why should people who take care of their health pay the same tax rates (that pay for health care) as people who are sick and are the main users of healthcare?

The main problem here is not even, "high risk riders" paying a bit more than "low risk riders" (I'm fine with that), it's a corporation wanting to deter "high risk riders" from insuring their vehicles altogether. They're just telling long term loyal SF customers "we don't want your business." If State Farm profited from their SS customer base for years with their competitive rates, that shows that their rates were still bringing in decent money for the company. So why does Dejardins want to profit 2-3 fold for each of these policies now? That's an unnecessary 2+ grand extra profit for each policy, this is stealing! The rate increase for SS didn't come in as a result of an annual review where the company was losing money from SS being overrepresented in the claims data, it came straight from the new company wanting to profit more. Hence my earlier comment that the government doesn't regulate jack **** when it comes to insurance rates... These guys have a license to steal

 

[xfactor]

No. Less risky policies do not subsidize more risky ones. They all pay into the same insurance pool, but those deemed to be of greater risk pay more into the insurance pool as they are deemed to be more likely to draw from that pool.

A real good example of this is in the private supplemental medical and benefits insurance business. The rates for my private Sun Life supplemental medical and dental coverage is based on demographics - older pay more than younger, smokers more than non-smokers, men more than women. It all goes into the same insurance pool, but those who are more likely to draw from it will pay more, and as one gets older substantially more.

Vehicle insurance is no different. Those more likely to draw from the pool will pay more into it, and that is as it should.

Comparing this to public education or basic health care is a non-starter. There is a societal interest in having a healthy and educated populace. There is no corresponding societal benefit to making it affordable for the most inexperienced or irresponsible drivers/riders to be able to afford insurance on a high-powered or otherwise high-risk vehicle.

I was under the impression that I was saying the same thing. I don't think that I said that the share is divided equally, but that's subsidised.

 

[griff2]

I was under the impression that I was saying the same thing. I don't think that I said that the share is divided equally, but that's subsidised.

Paying into an insurance pool proportionately according to risk profile isn't the same as subsidizing.

 

[xfactor]

Paying into an insurance pool proportionately according to risk profile isn't the same as subsidizing.

But it is. Your turn.

 

[PrivatePilot]

Paying into an insurance pool proportionately according to risk profile isn't the same as subsidizing.

Exactly.

There's a very large misunderstanding amongst many here about how insurance works.

I know insurance companies are one of those things we all love to hate, but when you sit down and look at the way it actually works and educate yourself a little it all starts to make more sense, but if your solution to perceived inadequacies or logical fallacies (ie why do I have to pay so much when my 20 year older dad pays 1/4 that amount?!) is to stick your fingers in your ears and scream about it instead of striving to understand it better, well, discussing it is probably a waste of time.

Is our insurance system here in Ontario problematic and arguably overpriced when compared to other jurisdictions? Sure. But as several of us have mentioned (and backed up with factual articles) it has more to do with fraud than anything else...but even if and when the system gets "fixed" if the 16 year old rider with a 1000cc SS thinks he's going to magically pay the same rate as the 50 year old guy with a 750 cruiser, well, it ain't gonna happen - risk profiles still matter. We might ALL just pay a percentage less, that's all.

 

[kellen]

Why should drivers with decent driving/riding records operating proven lower-risk vehicles subsidize the insurance rates of those who have poor driving/riding records who choose to operate vehicles with a proven high rate of claims?

That's how insurance works. If you run over and paralyzed someone tomorrow, who pays the 10 million dollars to that person? Your past and future rates won't cover it

 

[xfactor]

Exactly.

There's a very large misunderstanding amongst many here about how insurance works.

I know insurance companies are one of those things we all love to hate, but when you sit down and look at the way it actually works and educate yourself a little it all starts to make more sense, but if your solution to perceived inadequacies or logical fallacies (ie why do I have to pay so much when my 20 year older dad pays 1/4 that amount?!) is to stick your fingers in your ears and scream about it instead of striving to understand it better, well, discussing it is probably a waste of time.

Is our insurance system here in Ontario problematic and arguably overpriced when compared to other jurisdictions? Sure. But as several of us have mentioned (and backed up with factual articles) it has more to do with fraud than anything else...but even if and when the system gets "fixed" if the 16 year old rider with a 1000cc SS thinks he's going to magically pay the same rate as the 50 year old guy with a 750 cruiser, well, it ain't gonna happen - risk profiles still matter. We might ALL just pay a percentage less, that's all.

I don't think people have said that two different segments of population's risk factors should be assessed as same. From an underwriters perspective, the risk loading and risk pooling are done to share the perceived risk. We all know that that x is more probable to do y vs z. So, it's only fair that X pays more than Z. I think we are all in agreement. Now where risk sharing and subsidising comes in as a insurance model is, that in order for us to carry any X's in the pool, we need n number of Zs.

This subsidy model is needed when you're dealing with a large number of population that you have to let into the pool. So, don't think of this from an individual policy holder point of view but from a systemic risk management principle. In closing, it's only by having majority of risk averse policy holders can we subsidise the more risk taking policy holders. In this system, you're assessed on your merits, so yea the 1000CC riding 16 year old kids pays accordingly to his skill and experience and the 50 year old according to his. The risk equalisation is the differential factor on how much the kid would pay if there are no adults in the pool.

 

[PrivatePilot]

That's how insurance works. If you run over and paralyzed someone tomorrow, who pays the 10 million dollars to that person? Your past and future rates won't cover it

But the young, inexperienced or risky driver paid a larger proportion of the premiums that funded that payout, which considering the statistics are clear on the reality that they are more likely to be the person who initiates that sort of loss, is entirely justified.

Do older experienced drivers have big accidents as well that result in financial loss for insurance companies? Absolutely.

Do younger inexperienced drivers have many more accidents vs the older experienced drivers? Absolutely.

 

[kwtoxman]

blah blah blah... Do younger inexperienced drivers have many more accidents vs the older experienced drivers? Absolutely.

I usually ignore your posts as they serve a high bias, are so misleading and cherry pick evidence. lol. But in this case, I'll make an exception. Very misleading imo.

Older motorcyclists (40 years and up) account for 75% of all motorcyclists’ deaths over this 10-year period [2002-2012] with 42-years-old now the average age of a motorcycle rider killed on the U.S. roads in a traffic crash.

https://rideapart.com/articles/what...ity-statistics-reveal-about-motorcycle-safety


http://ottawacitizen.com/news/local...vinces-motorcycle-deaths-near-seven-year-high



One can also see that for all vehicles, there are MORE total injuries and fatalities in the 45+ age group than in the under 25 age group (in Canada).

https://www.tc.gc.ca/media/documents/roadsafety/cmvtcs2012_eng.pdf

I'm sure you won't skip a heart beat though, let alone slow down.

 

[Macs]

I usually ignore your posts as they serve a high bias, are so misleading and cherry pick evidence. lol. But in this case, I'll make an exception. Very misleading imo.


https://rideapart.com/articles/what...ity-statistics-reveal-about-motorcycle-safety


http://ottawacitizen.com/news/local...vinces-motorcycle-deaths-near-seven-year-high

I'm sure you won't skip a heart beat though, let alone slow down.

I have him on my ignore list, but can see when others quote him. That one was funny. 10/10 for responding with evidence. Now we just wait for the hyperbole and narcissism to come back full force.

 

[hedo2002]

Your assuming that the SS policies were profit making book of business for SF. Can you post proof of this? Could be it was a "loss leader" or a very tiny portion of their overall book of business. You have, (as I am sure you would have posted them by now), no facts to back up your claim. So you also can't state with proven authority that Desjardins is now making 2 - 3X the profit on the same policies. Yes everyone pays into the insurance pool and ALL the other companies have, (by way of their higher SS rates), shown that SF rates were low. Now Desjardins has decided that as a BUSINESS decision they are no longer willing to be underpriced, (in comparision) to the other companies, and are adjusting their rates. Feel free also to support your claim that the rate increase "didn't come in as a result of an annual review where the company was losing money from SS being overrepresented in the claims data, it came straight from the new comapny wanting to profit more".

Again feel free to post where on the FSCO website that it states that a company MUST keep their rates "artifically low", (again in comparision to the rest of the market players). Bottom line is it sucks if your choice of vehicle is an SS, you can still insure the bike and ride it. Just not at a "discounted rate" That SF for whatever business reason chose to supply. There is a reason they got bought out.

So let me ask you a question let's say Desjadin didn't buy SF and instead SF simply applied to and recieve3d permission to adjusttheir underwriting rules and said "ok as of 01 Jan 2016 SF will no longer insure SS bikes. Then the SS owners were forced to look to other companies, (whose rates in some cases were already 2 - 3 X higher than SF). Would that be a better solution for you? Why should any company be FORCED to offer a lower price when none of the other companies doing business in that market were already charging higher prices? Or what if SF went bankrupt tomorrow, should all other companies then be forced to matchh SF current pricing model?

If indeed the price increase come people with SS bikes have two options shop around and get the best price possible for the remaining companies. Or choose to get a less risky classed vehicle.



This is no different than if Walmart tomorrow bought Dollarama and then stated instead of $1, our new bottom price will be $3, (which was already the price being charged by Walmart, Cdn Tire, Princess Auto, etc).

There are members on here who already ride SS's and are not with SF. They seem satified with the rates they are paying.

Because this is the only way insurance works! If everyone paid for their own expenses you wouldn't need insurance, would you? Using your reasoning, why should people who take care of their health pay the same tax rates (that pay for health care) as people who are sick and are the main users of healthcare?

The main problem here is not even, "high risk riders" paying a bit more than "low risk riders" (I'm fine with that), it's a corporation wanting to deter "high risk riders" from insuring their vehicles altogether. They're just telling long term loyal SF customers "we don't want your business." If State Farm profited from their SS customer base for years with their competitive rates, that shows that their rates were still bringing in decent money for the company. So why does Dejardins want to profit 2-3 fold for each of these policies now? That's an unnecessary 2+ grand extra profit for each policy, this is stealing! The rate increase for SS didn't come in as a result of an annual review where the company was losing money from SS being overrepresented in the claims data, it came straight from the new company wanting to profit more. Hence my earlier comment that the government doesn't regulate jack **** when it comes to insurance rates... These guys have a license to steal

 

[PrivatePilot]

https://rideapart.com/articles/what...ity-statistics-reveal-about-motorcycle-safety

http://ottawacitizen.com/news/local...vinces-motorcycle-deaths-near-seven-year-high

I'm sure you won't skip a heart beat though, let alone slow down.

You'll notice if you re-read my post that I (quite intentionally) used the word "drivers", not motorcyclists since the conversation has drifted to insurance in general, not just motorcycle insurance....therefore, my facts stand as accurate.

http://www.tirf.ca/publications/PDF...Crashes_MagnitudeCharacteristicsandTrends.pdf

To quote just the opening phrase for the TLDR crowd amongst us here...

® This report examines the involvement of young people (15*-24) in serious road crashes in Canada. It confirms that they are overrepresented in such crashes; the magnitude of the problem underscores the need for effective solutions.

Are the statistics for motorcyclists different? Yep. Are they bell-curved by an age group that has a high disposable income, can afford a motorcycle on a whim as well as the insurance, and accordingly covers many more miles than the younger age group? Yep.

If every 15-24 age group young person had no financial roadblocks to buying a motorcycle and getting into the sport (ie, every kid that WANTS a motorcycle actually BOUGHT a motorcycle and subsequently drove as many miles as the older age group has the time and money to do), do you think the bell curve would change?

I have him on my ignore list, but can see when others quote him.

Putting people on ignore lists on a message forum is the online equivalent of this.

But hey, whatever makes you feel better. I don't use ignore lists (never have, never will) because I'm mature enough to just ignore things and move along without the need for the forum software to do it for me. Like water off a ducks back, as they say.

 

[kwtoxman]

You'll notice if you re-read my post that I (quite intentionally) used the word "drivers", not motorcyclists since the conversation has drifted to insurance in general, not just motorcycle insurance....therefore, my facts stand as accurate.

I added more in case you squirmed that way. And look again at your language.

blah blah blah... Do younger inexperienced drivers have many more accidents vs the older experienced drivers? Absolutely.

One can also see that for all vehicles, there are MORE total injuries and fatalities in the 45+ age group than in the under 25 age group (in Canada).

https://www.tc.gc.ca/media/documents/roadsafety/cmvtcs2012_eng.pdf

 

[griff2]

One can also see that for all vehicles, there are MORE total injuries and fatalities in the 45+ age group than in the under 25 age group (in Canada).

There is no fixed upper age cut-off for drivers in any province. There is however a minimum driving license age in every province. Given that the 45+ age driver group is at least two or three times the size of the under 25 one, I would certainly expect the raw number totals to be larger for that older age group.

Now, what are the death and injury per capita or per km driven numbers for the two age groups?

Edit - the 45+ group has 4 times as many licensed operators than the under-25 group. https://www.tc.gc.ca/media/documents/roadsafety/cmvtcs2013_eng.pdf

 

[PrivatePilot]

There is no fixed upper age cut-off for drivers in any province. There is however a minimum driving license age in every province. Given that the 45+ age driver group is at least two or three times the size of the under 25 one, I would certainly expect the raw number totals to be larger for that older age group.

Now, what are the death and injury per capita or per km driven numbers for the two age groups?

Good to see I'm not the only one who understands statistics beyond the one portion of the numbers that fit your argument but don't include the whole picture.

One can also see that for all vehicles, there are MORE total injuries and fatalities in the 45+ age group than in the under 25 age group (in Canada).

Edit - the 45+ group has 4 times as many licensed operators than the under-25 group.

The numbers don't look quite so rosy anymore for the under 25 group when you actually crunch the numbers using all the stats.

 

[kwtoxman]

Good to see I'm not the only one who understands statistics beyond the cherry picked numbers some want to see.

Hey PP, next time you want to standardize your data, maybe you should be specific and shouldn't say stupid blanket statements like

Do younger inexperienced drivers have many more accidents vs the older experienced drivers? Absolutely.

 

[PrivatePilot]

Hey twatter

Is it possible to have a grown up conversation around here without someone resorting to calling others childish names?

 

[kwtoxman]

Is it possible to have a grown up conversation around here without someone resorting to calling others childish names?

Ah, a red herring logical fallacy.

And to reply, fwiw condescending posts beget condescending posts. But hey, I've changed it for you. To PP. I like it.

 

[griff2]

Back to why higher rates for supersports. American numbers, but I doubt there would be much difference here seeing as SAAQ in Quebec has published similar results for that market.

• Registration-based death rates indicate that drivers of cruisers, standards, touring and sport-touring motorcycles have the lowest death rates.
• Motorcyclists who drive supersport motorcycles, which make up a small fraction of registered motorcycles, are overrepresented in fatal crashes.
• A 2010 Institute study found that the driver death rate per 10,000 registered motorcycles for supersports was about 4 times as high as the rate for motorcyclists who rode cruisers or standards.
• The driver death rate for sport motorcycles was about twice as high as the rate for drivers of cruisers or standards.

Back to why certain groups of riders are double-whammied.

• Different types of motorcycles tend to attract riders in different age groups. Riders of supersport, sport and unclad sport bikes tend to be younger than riders who choose standard, cruiser and touring motorcycles.
• Fatally injured rider characteristics are similar within each motorcycle class, but differ across classes.
• Speeding and driver error are bigger factors in fatal crashes of supersport, sport and unclad sport bikes compared with other classes of motorcycles.
• Speeding was a factor in 58 percent of supersport riders' fatal crashes in 2013.
• Speeding was a factor in 48 percent of the fatal crashes of sport and unclad sport riders.
• Speeding was a factor in 26 percent of fatal crashes among riders of cruisers and standards.
• Speeding was a factor in 19 percent of riders of sport-touring motorcycles.
• Speeding was a factor in 23 percent of riders of touring motorcycles.
• Sport and supersport riders were more likely to have been wearing helmets than many other motorcyclists. Seventy-five percent of supersport riders who died in crashes in 2013 wore helmets, compared with 50 percent of cruiser and standard riders.

 

[Rossi86]

Your assuming that the SS policies were profit making book of business for SF. Can you post proof of this? Could be it was a "loss leader" or a very tiny portion of their overall book of business. You have, (as I am sure you would have posted them by now), no facts to back up your claim. So you also can't state with proven authority that Desjardins is now making 2 - 3X the profit on the same policies. Yes everyone pays into the insurance pool and ALL the other companies have, (by way of their higher SS rates), shown that SF rates were low. Now Desjardins has decided that as a BUSINESS decision they are no longer willing to be underpriced, (in comparision) to the other companies, and are adjusting their rates. Feel free also to support your claim that the rate increase "didn't come in as a result of an annual review where the company was losing money from SS being overrepresented in the claims data, it came straight from the new comapny wanting to profit more".

Again feel free to post where on the FSCO website that it states that a company MUST keep their rates "artifically low", (again in comparision to the rest of the market players). Bottom line is it sucks if your choice of vehicle is an SS, you can still insure the bike and ride it. Just not at a "discounted rate" That SF for whatever business reason chose to supply. There is a reason they got bought out.

So let me ask you a question let's say Desjadin didn't buy SF and instead SF simply applied to and recieve3d permission to adjusttheir underwriting rules and said "ok as of 01 Jan 2016 SF will no longer insure SS bikes. Then the SS owners were forced to look to other companies, (whose rates in some cases were already 2 - 3 X higher than SF). Would that be a better solution for you? Why should any company be FORCED to offer a lower price when none of the other companies doing business in that market were already charging higher prices? Or what if SF went bankrupt tomorrow, should all other companies then be forced to matchh SF current pricing model?

If indeed the price increase come people with SS bikes have two options shop around and get the best price possible for the remaining companies. Or choose to get a less risky classed vehicle.



This is no different than if Walmart tomorrow bought Dollarama and then stated instead of $1, our new bottom price will be $3, (which was already the price being charged by Walmart, Cdn Tire, Princess Auto, etc).

There are members on here who already ride SS's and are not with SF. They seem satified with the rates they are paying.

Ok then, why don't you show me the data that State Farm was insuring SS bikes at a loss for the last 10+ years because of their "low rates" and now they're out of business, so they got bought out as a result of that...

Forum Sponsor