Saturday, 23 March 2019

Amica and Ameriprise Had the Highest Auto Insurance Rate Increases in New York in Q4 2018

These companies raised rates for some customers 19.9% and 14.9%, respectively.

A total of 32 companies were approved for auto insurance rate changes effective in October in New York. In aggregate, the insurance companies estimated a $43.5 million increase in written premiums, with over 2.3 million drivers impacted. Assuming the increases were evenly spread, each affected driver in New York would pay $18.55 more in premiums a year.

Summary of rate changes effective starting October 2018

Amica and Ameriprise led the pack of the 32 carriers, with the highest overall rate impacts of 19.9% and 14.9%, respectively. At the other end of the spectrum, GEICO and Preferred Mutual were approved for rate decreases for their customers, although the magnitude was very small: -0.6% and -0.1%. The average rate change across the 32 insurers we surveyed was 5.8% for October.

Insurance Company Written Premium Change ($000) % Difference Policyholders Affected
Amica P&C Ins Co $1,155 19.9% 3,566
Ameriprise Ins Co $3,502 14.9% 9,724
Utica Mutual Ins Co $317 11.9% 1,678
Utica National Ins Co of Texas $1,616 11.6% 8,066
Country-Wide Ins Co $19,068 10.7% 55,967
Maidstone Ins Co $2,110 9.9% 9,309
Cincinnati Ins Co $1,382 9.9% 6,121
CSAA General Ins Co $1,215 9.9% 9,660
Maidstone Ins Co $209 9.2% 998
Amica Mutual Ins Co $7,343 8.7% 47,498
Nationwide Affinity Ins Co of America $12,980 8.5% 66,968
Old Dominion Ins Co $1,774 8.4% 17,338
AIG Property Casualty Co $1,641 6.3% 5,096
Citizens Ins Co of America $86 5.0% 659
Electric Ins Co $481 5.0% 6,250
Hanover Ins Co $10 5.0% 67
Main Street America Protection Ins Co $1,050 5.0% 15,608
Massachusetts Bay Ins Co $44 5.0% 356
Mercury Casualty Co $627 5.0% 8,574
Utica National Ins Co of Texas $778 5.0% 9,317
Utica Mutual Ins Co $184 4.8% 2,935
Nationwide Ins Co of America $2,018 3.4% 24,354
Esurance P&C Ins Co $568 2.5% 11,430
Metropolitan P&C Ins Co $267 1.0% 19,509
Metropolitan Casualty Ins Co $434 0.8% 25,869
State Farm Fire and Casualty Co $174 0.1% 69,441
State Farm Mutual Automobile Ins Co $1,567 0.1% 1,196,866
Metropolitan Group P&C Ins Co $1 0.0% 77
Pacific Employers Ins Co $0 0.0% 3,630
Preferred Mutual Ins Co -$32 -0.1% 47,318
GEICO General Ins Co -$14,913 -0.6% 537,206
Government Employees Ins Co -$4,115 -0.6% 125,535

Notable changes for Amica customers (effective Oct. 2018)

Amica Property & Casualty Insurance Company submitted its rate filing to the New York Department of Financial Services at the end of last year and obtained approval in June 2018. Changes were effective Oct. 1, 2018, for its new and existing policyholders in the Empire State. The new increase is expected to span 0.2% to 39.1% across the roughly 3,500 policyholders impacted, for an average of $324 per policy.

Not all news was bad, however. The company implemented more generous discounts for some of its policyholders.

Amica added a new 9% discount for customers with auto, home and umbrella insurance with Amica. New York customers who qualify for this discount can get an additional 3% off (for a total of 12%) if they also have two life insurance policies with Amica. Additionally, Amica introduced a new 3% discount for prospective customers who own a house or condo that is currently insured with competitors. Should you have auto and homeowners insurance in New York with Amica, that discount increases to 8%.

The company also raised its Paid-in-Full discount from 2% to 4% to further incentivize customers to abandon their monthly payment plans. The last discount news of note was Amica’s revision of its definition of Good Student Discount. It replaced “at least 16 years of age” with “a licensed driver.” Rate tables show the discounts beginning for 17-year-old drivers, which means that 16-year-old licensed drivers may no longer qualify.

The New York Department of Financial Services also clarified in this rate filing that Amica had to re-underwrite customers based on credit reports if requested within a 36-month period. The insurer had previously noted it would re-underwrite every three years. The timeline for this implementation is under discussion. We’d highly recommend any customers with improving credit to request that updated scores be factored into their new rates. If other base rates or circumstances haven’t changed, this might save customers money on their auto insurance costs.

Notable changes for Ameriprise customers (effective Nov. 2018)

Ameriprise Insurance Company increases will be rolled out for both new business and existing New York customers renewing their policies on Nov. 4, 2018. In their actuarial memorandum, the car insurance company states that it is increasing “present rates to pay for our best estimate of losses and expenses, including a reasonable profit margin.” It also notes that profitability for its program is eroding rapidly, and it’s hoping the program will improve performance and increase its existing market share.

Ameriprise calculates that its customers will see their base rates increase anywhere from 2.9% to 18.1% and generate $3.5 million more in additional premium costs. Most of the increase is to its base rate for PIP in New York, which has traditionally been fraught with high fraud rates. Its last increase was effective Oct. 29, 2017, for 15.2%.

Rate changes across the top 10 auto insurance carriers in N.Y., October year to date

Rate changes were more moderate across the largest 10 auto insurance companies in New York, which account for 88% of the market. As of October year to date, rates increased by 3.1% across these groups. Liberty Mutual ranked as the company with the highest overall weighted change, while State Farm bucked the trend and registered a 3.4% decrease this year.

Size Rank Company Direct Written Premiums in 2017 ($mm) Rate Change % (Year-to-date)
1 Berkshire Hathaway Group $4,234 5.9%
2 Allstate Insurance Group $1,844 1.4%
3 State Farm Group $1,758 -3.4%
4 Progressive Group $1,284 0.0%
5 Liberty Mutual Group $731 9.8%
6 Travelers Group $530 3.3%
7 United Services Automobile Association Group $392 4.9%
8 NYCM Insurance Group $327 5.1%
9 Nationwide Corporation Group $303 0.5%
10 AmTrust NGH Group $292 4.4%
Top 10 Groups $11,695 3.1%
Bailey Peterson

Bailey is a Junior Research Analyst at ValuePenguin, covering credit cards and insurance. He graduated from Occidental College with a B.A. in Mathematics and a minor in Computer Science.


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