How to buy back a totaled car cheap.

[shadrach74]

Originally Posted by cfos

I agree with the first statement, not the rest. If you were following along, the people involved are high school students, yes? If the pay out is the $8-10k Jake (plus whatever the other side may be) is suggesting... I'd argue I do have an idea of whether the insurance company lost out. Assuming the kid is 16-18 years old, he couldn't have been driving for more than what? 3 years? You think this kid paid $8-10k+ in premiums over >3 years?

My guess is the kid was a part of the parent's policy and thus, insured for less as a result of a family plan. Even so, if the kid paid for his own policy, I seriously doubt he was paying in a like amount to what is being paid out, in total. Just think about it and revisit your statement.

I don't think you really understand how insurance works... See thstone's very simple and accurate explanation.

To put a finer point on it: Insurance companies don't price individual policies to be profitable. They price the that particular risk group to profitable.

In simply terms the concept is this - if underwriting shows a $20,000 payout for every 50 teenage drivers annually, they build a policy based on that info that will generate enough revenue from the insured drivers in that risk pull to cover the planned costs (based on stats) plus a number of other multipliers plus the company's administrative costs, plus a margin.

So if on average the payout $20K annually for every 50 insured and the average premium for this group is $1600; the company has $80K in revenue for every $20K it pays out.

I've completely made up these numbers, but the concept stands true.

Car insurance companies don't ever really loose, the just win by a lesser margin some years. They would not be going concerns for very long if they weren't underwriting policies that made sense...

It's not winners and losers, it's a number's game. Jake is a line item, it's not personal. A decent adjuster will not be taken advantage of, and it's Jake's responsibility to be his own advocate (the adjuster likely won't). It's not being greedy, it's being prudent.

[cfos]

Originally Posted by shadrach74

I don't think you really understand how insurance works... See thstone's very simple and accurate explanation.

To put a finer point on it: Insurance companies don't price individual policies to be profitable. They price the that particular risk group to profitable.

blah blah blah, numbers, arithmetic, etc.

Actually, I do understand how insurance works without going into history of house fires, I'm just looking at the data in a different way -- you know, like when a President-elect wins by popular vote, yet loses the election by the electoral vote, or how Michael Jordan didn't have fouls called on him and gets game winning shots (or LeBron's "Crab dribble"), or my father's favorite argument ''Mickey Mantle would have had the most stolen bases ever, if he didn't have bad knees". It's just a simple argument. No need to break out the HP 12C.

Surely, we can take something out of context (right?) and look at the question in a different way, yes? I certainly stomach enough of that here without commenting on everything about guns, car-flipping, etc.

If not, fine. You win. I'll say this now, and you can all sleep well -- The 986 really IS A CLASSIC! All things before and after are crap!!! Standard transmission should be required to vote!!! The Boxster is SO NOT A GIRL CAR!!! All things even, no one should ever buy a new car because of all things in life, car purchases must equal out and balance when it comes to a car purchase and we cannot accept a loss on this single purchase, ever!!!! BOB is NOT A UNICORN!







But, if you can conceive of what I proposed, bearing in mind that I'm not concerned with the ins, outs, and what-have-yous of what goes into the calculation of the rate... I am saying, in this particular instance, I don't think the insurance company got enough money for the individual through their set rate, to offset what they are paying out.

Stating it simply, insurance company received "x"; insurance company pays our "(x1-x2)+y"; (x1-x2)+y > x. QED.

That's it.

Now, having said this and since you and thstone are so much more knowledgeable about rate calculation than I, what is the modification for a person who gets into the accident? Is it just a simple jump to a higher risk group? What amount of a pay-out determines if someone is dropped? What if the driver is a member of a family policy? Does the policy go up if the kid is dropped? If the parents drop the kid do they return to the pre-kid rate? I'd assume teen drivers are already in a high rate group, so what is the next step? 1 standard deviation (SD)? Is it 2? Do we employ the Avagadro constant? Moreover, how do these accidents, or accidents such as this, go into the recalculation of rates of everybody? Do "safe drivers" go up a 1/2 a SD? How frequently are the rates calculated? How is it that Allstate has/had(?) that policy where rates actually go down over time? Was that all a lie?

[Timco]

Originally Posted by cfos

Actually, I do understand how insurance works without going into history of house fires, I'm just looking at the data in a different way -- you know, like when a President-elect wins by popular vote, yet loses the election by the electoral vote, or how Michael Jordan didn't have fouls called on him and gets game winning shots (or LeBron's "Crab dribble"), or my father's favorite argument ''Mickey Mantle would have had the most stolen bases ever, if he didn't have bad knees". It's just a simple argument. No need to break out the HP 12C.

Surely, we can take something out of context (right?) and look at the question in a different way, yes? I certainly stomach enough of that here without commenting on everything about guns, car-flipping, etc.

If not, fine. You win. I'll say this now, and you can all sleep well -- The 986 really IS A CLASSIC! All things before and after are crap!!! Standard transmission should be required to vote!!! The Boxster is SO NOT A GIRL CAR!!! All things even, no one should ever buy a new car because of all things in life, car purchases must equal out and balance when it comes to a car purchase and we cannot accept a loss on this single purchase, ever!!!! BOB is NOT A UNICORN!


But, if you can conceive of what I proposed, bearing in mind that I'm not concerned with the ins, outs, and what-have-yous of what goes into the calculation of the rate... I am saying, in this particular instance, I don't think the insurance company got enough money for the individual through their set rate, to offset what they are paying out.

Stating it simply, insurance company received "x"; insurance company pays our "x+y"; x+y > x. QED.

That's it.

Now, having said this and since you and thstone are so much more knowledgeable about rate calculation than I, what is the modification for a person who gets into the accident? Is it just a simple jump to a higher risk group? What amount of a pay-out determines if someone is dropped? What if the driver is a member of a family policy? Does the policy go up if the kid is dropped? If the parents drop the kid do they return to the pre-kid rate? I'd assume teen drivers are already in a high rate group, so what is the next step? 1 standard deviation (SD)? Is it 2? Do we employ the Avagadro constant? Moreover, how do these accidents, or accidents such as this, go into the recalculation of rates of everybody? Do "safe drivers" go up a 1/2 a SD? How is it that Allstate has/had(?) that policy where rates actually go down over time? Was that all a lie?

So, guns and car flipping aside, if I get a new policy tomorrow with a new company and total my car day 1, will my payout or settlement be less than if my accident happened with my current carrier of 10+ years?

The lowering rate thing is based on driving class. Someone with no accidents for 4 years is less likely to cause an accident than someone 2 years accident free. We have Am Fam and our rate is way low because our house, rentals, my commercial policy, and my business liability policies are all with them. I guess that makes me a better driver?

[cfos]

Originally Posted by Timco

So, guns and car flipping aside, if I get a new policy tomorrow with a new company and total my car day 1, will my payout or settlement be less than if my accident happened with my current carrier of 10+ years?

The lowering rate thing is based on driving class. Someone with no accidents for 4 years is less likely to cause an accident than someone 2 years accident free. We have Am Fam and our rate is way low because our house, rentals, my commercial policy, and my business liability policies are all with them. I guess that makes me a better driver?

I have no idea. Do you have gap insurance? I don't have the whole package like you; I just pay in full. I do know that my family's rate, over time, varies during renewals. Sometimes, I find the same or better coverage for less than the new rate, and I move. But, what if the driver starts at 16 and has no accidents for 4 years. Is this 20 y.o. less likely to have an accident? Is his rate less that a 23 y.o. married returned missionary that didn't drive for 2 years? I dunno. Oh, and I'm sure you are a better driver -- I mean, you drive standard and are more "in touch" with your car.

[Timco]

Originally Posted by cfos

I have no idea. I don't have the whole package like you; I just pay in full. I do know that my family's rate, over time, varies during renewals. Sometimes, I find the same or better coverage for less than the new rate, and I move. But, what if the driver starts at 16 and has no accidents for 4 years. Is this 20 y.o. less likely to have an accident? Is his rate less that a 23 y.o. married returned missionary that didn't drive for 2 years? I dunno. Oh, and I'm sure you are a better driver -- I mean, you drive standard and are more "in touch" with your car.

Pretty sure there's only one blanket drop in rate around 22-24 regardless of real hands on driving due to maturity. If there's tickets or accidents, forget that drop. Not much windshield time for missionaries. (I joined way after missionary age)

Not sure about the better driver comment. I've never claimed that and am quite sure your car will cross the finish line before mine. I've never owned an auto trans.

[cfos]

Originally Posted by Timco

Pretty sure there's only one blanket drop in rate around 22-24 regardless of real hands on driving due to maturity. If there's tickets or accidents, forget that drop. Not much windshield time for missionaries. (I joined way after missionary age)

Not sure about the better driver comment. I've never claimed that and am quite sure your car will cross the finish line before mine. I've never owned an auto trans.

I do recall a decrease upon marriage. I don't know about the age rates, nor claim to.

Yeah, you never did claim to be better/faster then me, I'm just assuming -- since you have a standard and from all the comments here about driving standard...

It's ok. I'm not much of a boy-racer or a BMW guy that cares about the whole modded 335 vs M3 debate. I get where I want to be. Don't need to be first. Don't care if I'm last. Kinda like having a clean driving record and feel lucky about not finding renegade Ford Broncos -- I wonder if it was a Bronco that caused the whole ruckus on I-80W this morning. Saw on the news the whole damn thing was shut down.

[Timco]

Originally Posted by cfos

I do recall a decrease upon marriage. I don't know about the age rates, nor claim to.

Yeah, you never did claim to be better/faster then me, I'm just assuming -- since you have a standard and from all the comments here about driving standard...

It's ok. I'm not much of a boy-racer or a BMW guy that cares about the whole modded 335 vs M3 debate. I get where I want to be. Don't need to be first. Don't care if I'm last. Kinda like having a clean driving record and feel lucky about not finding renegade Ford Broncos -- I wonder if it was a Bronco that caused the whole ruckus on I-80W this morning. Saw on the news the whole damn thing was shut down.

Out by the Nevada border? Dead person on interstate. Could not tell male / female. At first I thought damn, must have been THAT ugly, but turns out was hit multiple times.