We are continuing our exploration of car insurance, rate increases and ways to protect yourself, your family and assets from disastrous results arising from a car wreck. We began our discussion with the last newsletter in which we talked about the increase in auto insurance rates. Those rates followed changes in the law which make it easier for an automobile insurer to raise its rates. In fact, most rate increases do not require prior approval by the insurance commissioner. This law, which arose as SB 276, caused this deregulation of insurance rates and led directly to the most recent significant rate increases. See the article linked below for a discussion of this law and the fact that the Insurance Commissioner has no discretion to reduce the rates, reduce the rate of increases or  change the law. Only the General Assembly can change the law. http://www.myajc.com/news/state--regional-govt--politics/commissioner-silent-car-insurance-rates-soar/WaerOb6LMjPyiT7WXWetVL/. The pendulum has swung too far away from regulating rates and too far in favor of “anything goes”.  As a citizen, you can make up your own mind, determine which candidates for Insurance Commissioner and your State Senate/House member are in favor of the current climate where rate hikes are basically up to the insurance companies or whether some mechanism must be in place to check that unfettered power to raise rates. 
 
The article linked above discusses some of the causes of increases in rates. No where in the article does anyone claim that lawsuits cause the rates to go up. Lawsuits and trials have decreased on tort claims which include car wrecks. https://www.wsj.com/articles/we-wont-see-you-in-court-the-era-of-tort-lawsuits-is-waning-1500930572.This is critical as most members of our community express concerns about the impact of lawsuits/trials on rates. This truth must be made clear. Car wreck lawsuits are not the case of increased rates. It is a myth which insurance companies want you to believe. Do not be a victim of such misdirection.
In fact, according to the Georgia Insurance Commissioner's office, the Insurance Commissioner does not monitor how much of the premiums' collected by auto insurers is paid out in claims. Or how much an insurance company pays its CEO or high level executives or how much it spends on television advertising (doesn't it seem like at times every other commercial on television is an auto insurer? In fairness, drug companies and certain law firms advertise a lot also).  But how do you protect yourself from rising rates? You should shop around; bundle home/auto/life products to achieve discounts; consider raising your deductible; explore other available “good driving” discounts or similar programs.   Until our Insurance Commissioner and Legislature take a more moderate, middle of the road approach to rising rates, there is no guarantee that rates will stabilize.          
              
 Next time, we will discuss how much insurance you need.