OT: Car manufacturers are sharing your driving data with insurance companies...

[verticaldoug]

Originally Posted by OtayBW

Again, what I can't resolve is how, in the wide, wide world of sports, many auto insurance companies can they get away with some of the exorbitant increases (up to ~40% as we've seen here) that I suspect are not commensurate with actual costs?

Well, if loss ratios are increasing, then costs are actually increasing faster than they are hiking premiums.

Your perception of inflation really depends on your goods baskets. But if you look at aggregate data, there is a lot of lag effects when car prices go up, when parts go up, when service and repair goes up and finally when insurance goes up. insurance is actually lagging here. It looks like insurance inflation peak January 2024. New Car prices probably April 22, Used cars Feb 22. Parts probably mid 2022, body work etc probably early 2023.
You also see price deflation in parts starting end of 2023. data is all BLS courtesy of Bloomberg.

[OtayBW]

Thanks for the data, VD. I note that while a lot of the cost data listed have risen appreciably from ~2019-YTD, much, if not most, of the items listed, including i) vehicle maintenance and servicing, ii) tires, iii) vehicle accessories, and iv) motor vehicle repair would seem to be peripheral to the cost of insurance adjustments and higher premiums. v) Cost of body work has also remained flat through this period. Cost of metals and non-luxury new car prices have indeed taken off and would seem to be a nontrivial factor in insurance rate hikes though replacement vehicles, but I remain uncertain about how to account for ~40% (+/-) rate hikes in the insurance industry over the last several months.
Cheers.

[Gwerziou]

Originally Posted by edgerat

Insurance prices are going up because insurance companies are socialist. When ours went up 30% I called our agent and screamed and yelled. He said that 1in 4 drivers are uninsured so, the insurance companies are getting their money from the law-abiding to cover the freeloaders.

Insurance prices are going up because insurance companies are capitalist pigs.

[jkbrwn]

Originally Posted by Gwerziou

Insurance prices are going up because insurance companies are capitalist pigs.

[tomato coupe]

Insurance prices are going up because insurance companies are socialist.

Insurance prices are going up because insurance companies are capitalist pigs.

Funny. Turn this into a poll and you would likely find a high correlation between peoples' responses and their political leanings.

[BumbleBeeDave]

. . . surprises anybody. Maximize income, minimize expenses. That's how any of these companies work. Food corporations shrink packages and boost prices, blaming it on "inflation.". . . Airlines cram more people on every plane, comfort and convenience be damned. . . . Boeing. Need I say more?

auto insurance companies don't make profits by paying claims. They make money by avoiding paying claims, hand in hand with charging what the market will bear without apology for a product that in (as far as I know) all states in the union we are required by law to purchase.

Taking this into account, as well as 30 years in newspaper journalism viewing the full spectrum of human scummy-ness, nothing underhanded that any of these companies do surprises me in the least any more.

[benb]

Don't forget the old trick, "We have flat profits so need to raise prices. Please don't look behind the curtain at how we spent all the profits we would have reported on executive compensation..."

This is an especially good trick for non-profits, but that's more health insurance than car insurance I thought.

[cgolvin]

I bought a new car last year so by default includes a net connection. While I can't claim to have read every line of the mountain of paperwork included in the purchase, I did pay attention on the data privacy front and at no point did they provide an opportunity to opt out of their data collection and sharing.

After the fact, using the app I was able to find the opt out section, and boy do they make it a PITA to do so. In fact it was impossible within the app because the app was just a front end to their web interface, which used a CAPCHA served by a third party … so the app blocked it as a security measure I resorted to the web interface and, for every individual opt out they put me through a battery of questions that seemed to come from a credit score data broker (such as "which of these numbers are the address of a house you have lived at in the last 15 years?").

You have to be extremely persistent to make your way through all of this and it's only for data sharing, there's no way to opt out of the manufacturer collecting your data.

insert Scott McNealy quote <here>

Oh, and I'm really looking forward to three years from now when they want to start charging me for all those connected app features. At least they won't try to charge me for the ability to use the seat warmers.

[jkbrwn]

Originally Posted by cgolvin

I bought a new car last year so by default includes a net connection. While I can't claim to have read every line of the mountain of paperwork included in the purchase, I did pay attention on the data privacy front and at no point did they provide an opportunity to opt out of their data collection and sharing.
....

This made me look into my car. Pleasantly surprised to see this disabled by default. I certainly didn't uncheck it in the last 18 months of owning this car. Was also very easy to opt out of personal data sales. Shame that it has to be done but c'est la vie.

[Ken Robb]

Originally Posted by unterhausen

USAA has an app that spys on you. It is awful. It apparently detects hard braking/acceleration if you get a gps glitch on the freeway, and I also got an event when I turned right. Uninstalled it after that drive.

What did you uninstall?

[AngryScientist]

Not to [continue to] sound retrogrouchy, but IMO, we've gone too far with the connectivity and mobile app thing.

I pay for auto insurance every month, just like I always have. Why on earth would I want an app on my phone for my insurance company? I have absolutely no interest in having a day-to-day relationship with them or need to interact with them, pretty much never outside of being involved in an accident.

All of the cars in my driveway need keys to start. Perhaps I'm missing out on some minor conveniences, but again, I cant imagine wanting a mobile app on my phone to interact with my vehicle. I sure dont want it collecting data about how, when and where I drive and sharing it with my insurance company or anyone else.

"uh-oh, Angry hasn't changed his oil in a while and yesterday he was doing 70mph in a 65 zone - he must be a very bad person"

[GregL]

Federal Reserve chair Jerome Powell weighs in on car (and home) insurance cost increases and the effects on inflation: https://www.msn.com/en-us/money/mark...13edcf3f&ei=35. TLDR: climate change (resulting in more natural disasters) is driving large increases in home insurance costs and increasing complexity of cars is driving vehicle insurance cost growth.

Greg

[AngryScientist]

Originally Posted by GregL

Federal Reserve chair Jerome Powell weighs in on car (and home) insurance cost increases and the effects on inflation: https://www.msn.com/en-us/money/mark...13edcf3f&ei=35. TLDR: climate change (resulting in more natural disasters) is driving large increases in home insurance costs and increasing complexity of cars is driving vehicle insurance increases.

Greg

Yep, and word is that warmer oceans in general are going to make hurricane season more active and more powerful.

At least I can control what kind of car I drive and what technology it has, but cant do much about the weather.

Hold on tight!

[jlwdm]

My auto renewal quote is 120% higher than last year. I contacted another company and got a quote with no increase.

I reject the systems that can reduce your premium by monitoring mileage and/or driving habits.

Jeff

[C40_guy]

Originally Posted by AngryScientist

Not to [continue to] sound retrogrouchy, but IMO, we've gone too far with the connectivity and mobile app thing.

No kidding. My electric toothbrush has an associated IOS app. I can't imagine why I'd want to enable that.

...oh...I can customize the LED lights on the handle and "gamify" brushing.

(while feeding the mothership detailed information about my brushing habits...)

Um, no.