A "Call to Action"
John McCain believes we can and must provide access to health care for every American. He has proposed a comprehensive vision for achieving that. For too long, our nation's leaders have talked about reforming health care. Now is the time to act.
Americans Are Worried About Health Care Costs. The problems with health care are well known: it is too expensive and 47 million people living in the United States lack health insurance.
John McCain's Vision for Health Care Reform
John McCain Believes The Key To Health Care Reform Is To Restore Control To The Patients Themselves. We want a system of health care in which everyone can afford and acquire the treatment and preventative care they need. Health care should be available to all and not limited by where you work or how much you make. Families should be in charge of their health care dollars and have more control over care.
Making Health Insurance Innovative, Portable and AffordableJohn McCain Will Reform Health Care Making It Easier For Individuals And Families To Obtain Insurance. An important part of his plan is to use competition to improve the quality of health insurance with greater variety to match people's needs, lower prices, and portability. Families should be able to purchase health insurance nationwide, across state lines.
John McCain Will Reform The Tax Code To Offer More Choices Beyond Employer-Based Health Insurance Coverage. While still having the option of employer-based coverage, every family will receive a direct refundable tax credit - effectively cash - of $2,500 for individuals and $5,000 for families to offset the cost of insurance. Families will be able to choose the insurance provider that suits them best and the money would be sent directly to the insurance provider. Those obtaining innovative insurance that costs less than the credit can deposit the remainder in expanded Health Savings Accounts.
John McCain Proposes Making Insurance More Portable. Americans need insurance that follows them from job to job. They want insurance that is still there if they retire early and does not change if they take a few years off to raise the kids.John McCain Will Encourage And Expand The Benefits Of Health Savings Accounts (HSAs) For Families. When families are informed about medical choices, they are more capable of making their own decisions and often decide against unnecessary options. Health Savings Accounts take an important step in the direction of putting families in charge of what they pay for.A Specific Plan of Action: Ensuring Care for Higher Risk Patients John McCain's Plan Cares For The Traditionally Uninsurable. John McCain understands that those without prior group coverage and those with pre-existing conditions have the most difficulty on the individual market, and we need to make sure they get the high-quality coverage they need.
John McCain Will Work With States To Establish A Guaranteed Access Plan. As President, John McCain will work with governors to develop a best practice model that states can follow - a Guaranteed Access Plan or GAP - that would reflect the best experience of the states to ensure these patients have access to health coverage. One approach would establish a nonprofit corporation that would contract with insurers to cover patients who have been denied insurance and could join with other state plans to enlarge pools and lower overhead costs. There would be reasonable limits on premiums, and assistance would be available for Americans below a certain income level.John McCain Will Promote Proper Incentives. John McCain will work with Congress, the governors, and industry to make sure this approach is funded adequately and has the right incentives to reduce costs such as disease management, individual case management, and health and wellness programs.
A Specific Plan of Action: Lowering Health Care CostsJohn McCain Proposes A Number Of Initiatives That Can Lower Health Care Costs. If we act today, we can lower health care costs for families through common-sense initiatives. Within a decade, health spending will comprise twenty percent of our economy. This is taking an increasing toll on America's families and small businesses. Even Senators Clinton and Obama recognize the pressure skyrocketing health costs place on small business when they exempt small businesses from their employer mandate plans.
CHEAPER DRUGS: Lowering Drug Prices. John McCain will look to bring greater competition to our drug markets through safe re-importation of drugs and faster introduction of generic drugs.
CHRONIC DISEASE: Providing Quality, Cheaper Care For Chronic Disease. Chronic conditions account for three-quarters of the nation's annual health care bill. By emphasizing prevention, early intervention, healthy habits, new treatment models, new public health infrastructure and the use of information technology, we can reduce health care costs. We should dedicate more federal research to caring and curing chronic disease.
COORDINATED CARE: Promoting Coordinated Care. Coordinated care - with providers collaborating to produce the best health care - offers better outcomes at lower cost. We should pay a single bill for high-quality disease care which will make every single provider accountable and responsive to the patients' needs.
GREATER ACCESS AND CONVENIENCE: Expanding Access To Health Care. Families place a high value on quickly getting simple care. Government should promote greater access through walk-in clinics in retail outlets.
INFORMATION TECHNOLOGY: Greater Use Of Information Technology To Reduce Costs. We should promote the rapid deployment of 21st century information systems and technology that allows doctors to practice across state lines.
MEDICAID AND MEDICARE: Reforming The Payment System To Cut Costs. We must reform the payment systems in Medicaid and Medicare to compensate providers for diagnosis, prevention and care coordination. Medicaid and Medicare should not pay for preventable medical errors or mismanagement.
SMOKING: Promoting The Availability Of Smoking Cessation Programs. Most smokers would love to quit but find it hard to do so. Working with business and insurance companies to promote availability, we can improve lives and reduce chronic disease through smoking cessation programs.
STATE FLEXIBILITY: Encouraging States To Lower Costs. States should have the flexibility to experiment with alternative forms of access, coordinated payments per episode covered under Medicaid, use of private insurance in Medicaid, alternative insurance policies and different licensing schemes for providers.
TORT REFORM: Passing Medical Liability Reform. We must pass medical liability reform that eliminates lawsuits directed at doctors who follow clinical guidelines and adhere to safety protocols. Every patient should have access to legal remedies in cases of bad medical practice but that should not be an invitation to endless, frivolous lawsuits.
TRANSPARENCY: Bringing Transparency To Health Care Costs. We must make public more information on treatment options and doctor records, and require transparency regarding medical outcomes, quality of care, costs and prices. We must also facilitate the development of national standards for measuring and recording treatments and outcomes.Confronting the Long-Term Challenge John McCain Will Develop A Strategy For Meeting The Challenge Of A Population Needing Greater Long-Term Care. There have been a variety of state-based experiments such as Cash and Counseling or The Program of All-Inclusive Care for the Elderly (PACE) that are pioneering approaches for delivering care to people in a home setting. Seniors are given a monthly stipend which they can use to hire workers and purchase care-related services and goods. They can get help managing their care by designating representatives, such as relatives or friends, to help make decisions. It also offers counseling and bookkeeping services to assist consumers in handling their programmatic responsibilities.Setting the Record Straight: Covering Those With Pre-Existing ConditionsMYTH: Some Claim That Under John McCain's Plan, Those With Pre-Existing Conditions Would Be Denied Insurance.FACT: John McCain Supported The Health Insurance Portability And Accountability Act In 1996 That Took The Important Step Of Providing Some Protection Against Exclusion Of Pre-Existing Conditions. FACT: Nothing In John McCain's Plan Changes The Fact That If You Are Employed And Insured You Will Build Protection Against The Cost Of Any Pre-Existing Condition.
FACT: As President, John McCain Would Work With Governors To Find The Solutions Necessary To Ensure Those With Pre-Existing Conditions Are Able To Easily Access Care.Combating Autism in America John McCain is very concerned about the rising incidence of autism among America's children and has continually supported research into its causes and treatment.
Friday, June 20, 2008
Wednesday, June 18, 2008
5 Ways To Cut Car Insurance Costs
You can't fill your tank these days without feeling as if you've been kicked, simultaneously, in the gut and the bank account.
There's not much you can do about gas prices, but there is one thing you can do to cancel out rising car costs: Get a better deal on your auto insurance.
Competition has kept premiums low; and if you haven't revisited your policy in a while, you may have missed some money savers.
Try one (or more) of these methods to put your auto expenses in neutral.
Prune coverage on old cars
Once your vehicle is worth less than 10 times what you pay each year to insure it, get rid of comprehensive and collision. Find your car's estimated value at kbb.com.
Raise your deductible
The point of car insurance is to protect you from catastrophic costs (your emergency fund should cover stuff like dents and broken windows).
Raise your deductible from $200 to $1,000 and you could save more than 40% on premiums, says the Insurance Information Institute.
Nab discounts
Most insurers offer price cuts for such things as having anti-lock brakes; having been accident-free; having taken a defensive-driving course; and even for using the same insurer for your home policy. For more, see the auto insurance checklist at iii.org/individuals/auto.
These can take up to 25% off your premium. But your insurer won't come to you with them; call the company and ask what discounts it offers.
Dig up competing quotes
This is the most work but could have the greatest payoff. Go to naic.org to find your state insurance commission Web site, where you can download a car insurance buying guide.
This often lists scenarios (Mary is a 34-year-old married woman who drives a Chevy Tahoe) with sample rates from the biggest insurers in the state.
Pick the example closest to you and the five insurers with the lowest rates. Call them for quotes.
If the state guide doesn't list insurers, get the five best quotes at insweb.com, but note that the site doesn't include State Farm.
Next, check with an independent agent (get a name at iiaba.net) to see if any insurers you haven't checked can beat your top five.
Sidestep hassle
Make sure any insurer with a better quote is legit. Vet it via your state's insurance commission site; look especially for the ratio of complaints to number of policies written.
By Joe Light, Money Magazine
There's not much you can do about gas prices, but there is one thing you can do to cancel out rising car costs: Get a better deal on your auto insurance.
Competition has kept premiums low; and if you haven't revisited your policy in a while, you may have missed some money savers.
Try one (or more) of these methods to put your auto expenses in neutral.
Prune coverage on old cars
Once your vehicle is worth less than 10 times what you pay each year to insure it, get rid of comprehensive and collision. Find your car's estimated value at kbb.com.
Raise your deductible
The point of car insurance is to protect you from catastrophic costs (your emergency fund should cover stuff like dents and broken windows).
Raise your deductible from $200 to $1,000 and you could save more than 40% on premiums, says the Insurance Information Institute.
Nab discounts
Most insurers offer price cuts for such things as having anti-lock brakes; having been accident-free; having taken a defensive-driving course; and even for using the same insurer for your home policy. For more, see the auto insurance checklist at iii.org/individuals/auto.
These can take up to 25% off your premium. But your insurer won't come to you with them; call the company and ask what discounts it offers.
Dig up competing quotes
This is the most work but could have the greatest payoff. Go to naic.org to find your state insurance commission Web site, where you can download a car insurance buying guide.
This often lists scenarios (Mary is a 34-year-old married woman who drives a Chevy Tahoe) with sample rates from the biggest insurers in the state.
Pick the example closest to you and the five insurers with the lowest rates. Call them for quotes.
If the state guide doesn't list insurers, get the five best quotes at insweb.com, but note that the site doesn't include State Farm.
Next, check with an independent agent (get a name at iiaba.net) to see if any insurers you haven't checked can beat your top five.
Sidestep hassle
Make sure any insurer with a better quote is legit. Vet it via your state's insurance commission site; look especially for the ratio of complaints to number of policies written.
By Joe Light, Money Magazine
Tuesday, June 17, 2008
Graduates Get Creative To Find Health Insurance
This year, 1.4 million graduates are tossing their mortarboard caps into the sky and receiving bachelor's degrees. Almost immediately, many will face another rite of passage: getting dropped from their parents' health insurance.
Most group health plans cover employees' children until the age of 19 -- or often up to 23 if they are full-time students. After that, many young adults must put together their own health safety net. But with the economy weakening, and entry-level jobs that offer health coverage harder to find, some recent graduates are coming up with creative ways to protect themselves.
Phillip Ngo was removed from his father's workplace health insurance when he graduated from New York University last year. So the 22-year-old came up with an idea to get back on his parent's plan -- going back to college without ever setting foot in a classroom.
Even though he had a bachelor's degree, Mr. Ngo enrolled as an online student at his hometown City College of San Francisco, a two-year college. Two days later, he presented proof of enrollment and a class schedule to his father's insurance company, which put him back on the plan.
Young adults are the fastest-growing group of the uninsured, according to 2006 U.S. Census data. And one in three -- or 13.7 million -- Americans aged 19 to 29 lacks health insurance, according to the Commonwealth Fund.
At least 18 states have enacted laws that require insurers to allow parents to extend coverage for older dependents, often whether they are in college or not. A few other states have similar laws, but with various restrictions. Although a family's premium might go up, coverage is now available in most of these states for dependents up to age 23 or 25. In New Jersey, the upper limit is age 30.
But for young adults who don't live in any of these states, or who aren't claimed by their parents as dependents, college graduation can bring a scramble for health coverage. Some recent graduates shop online for the cheapest policy they can find, which often comes with a high deductible. Other people temporarily extend the coverage they previously had under their parents' plan through the federally mandated Cobra program, which often comes at a steep price. Some graduates go without insurance altogether and hope for the best.
Ineligible for Extension
Ryan Todd, 24, was removed from her parents' policy after graduating from DePauw University in 2006. She currently lives with her parents in California, which allows young adults to continue their health coverage after they graduate. But the state restricts this extended coverage to people who are disabled, making Ms. Todd ineligible.
Ms. Todd works as a freelance costume designer in Southern California. Later this year, she will be eligible for membership in a union that offers health coverage. Meanwhile, Ms. Todd has arranged a patchwork of temporary solutions. She occasionally text messages her symptoms for minor ailments to a doctor friend and gets his advice. She takes advantage of free services at Planned Parenthood. And she considers herself fortunate to be healthy. "I don't even make enough money to move out of my parents' house, let alone afford health insurance," Ms. Todd says.
Going without coverage isn't an option for some people. Cole Murray was diagnosed as an infant with aortic stenosis, a congenital heart defect. He has had five open-heart surgeries and two pacemakers and spent 10 days in a coma when he was 19. His medical costs in 2003 alone totaled $750,000, covered through his parents' insurance.
Mr. Murray's family lives in Indiana, and when he graduated from Columbia College in Chicago with a degree in film, he took advantage of his home state's law that allowed him to remain on his parents' policy an extra year. Now, Mr. Murray is paying $476 a month for Cobra coverage, which extends his parents' coverage until January, when he turns 25. Cobra is a federal law that provides continuation of group health coverage that otherwise might be terminated.
"Most people can spend a couple of years without health insurance, but I don't have that option," he says. Mr. Murray moved to Los Angeles last fall to pursue a career in film. If he doesn't line up a job with health coverage in the next few months, Mr. Murray says he will move back to his home town and look for any job that offers insurance.
Laura Roeder, 23, opted for a high-deductible policy after she graduated from University of Texas at Austin and started her own freelance Web design business in Chicago. She pays $60 a month for coverage through Humana Inc. But since none of her medical expenses under $5,000 are covered under the policy, she avoids routine visits to the doctor. She copes with colds and the flu by ingesting high-dosage vitamin C drinks.
"I'm going to stay self-employed," she says. "And [health insurance] is not suddenly going to become affordable."
Mr. Ngo says that after graduating from New York University with a theater degree, he "bounced around" between unpaid and low-paid internships and personal-assistant jobs in New York City. None offered health coverage. While uninsured, Mr. Ngo says he contracted a nasty flu. But fearing a big bill, he opted not to seek care. Although he got well on his own, the experience scared him.
Mr. Ngo says he got the idea to enroll in a community college in order to get back on his parent's coverage after hearing about the plan from a friend. "I never did anything for class," Mr. Ngo says. "For me, 300 bucks for a semester's health insurance was a good deal. So I thought why the hell not?"
In March, Mr. Ngo got a job as an assistant to a Broadway producer in New York. After 90 days on the job, he qualified for his employer's health insurance, for which he pays $32 a month. He withdrew from the community college, receiving incompletes for his classes.
Posted in the WSJ June 17, 2008
Most group health plans cover employees' children until the age of 19 -- or often up to 23 if they are full-time students. After that, many young adults must put together their own health safety net. But with the economy weakening, and entry-level jobs that offer health coverage harder to find, some recent graduates are coming up with creative ways to protect themselves.
Phillip Ngo was removed from his father's workplace health insurance when he graduated from New York University last year. So the 22-year-old came up with an idea to get back on his parent's plan -- going back to college without ever setting foot in a classroom.
Even though he had a bachelor's degree, Mr. Ngo enrolled as an online student at his hometown City College of San Francisco, a two-year college. Two days later, he presented proof of enrollment and a class schedule to his father's insurance company, which put him back on the plan.
Young adults are the fastest-growing group of the uninsured, according to 2006 U.S. Census data. And one in three -- or 13.7 million -- Americans aged 19 to 29 lacks health insurance, according to the Commonwealth Fund.
At least 18 states have enacted laws that require insurers to allow parents to extend coverage for older dependents, often whether they are in college or not. A few other states have similar laws, but with various restrictions. Although a family's premium might go up, coverage is now available in most of these states for dependents up to age 23 or 25. In New Jersey, the upper limit is age 30.
But for young adults who don't live in any of these states, or who aren't claimed by their parents as dependents, college graduation can bring a scramble for health coverage. Some recent graduates shop online for the cheapest policy they can find, which often comes with a high deductible. Other people temporarily extend the coverage they previously had under their parents' plan through the federally mandated Cobra program, which often comes at a steep price. Some graduates go without insurance altogether and hope for the best.
Ineligible for Extension
Ryan Todd, 24, was removed from her parents' policy after graduating from DePauw University in 2006. She currently lives with her parents in California, which allows young adults to continue their health coverage after they graduate. But the state restricts this extended coverage to people who are disabled, making Ms. Todd ineligible.
Ms. Todd works as a freelance costume designer in Southern California. Later this year, she will be eligible for membership in a union that offers health coverage. Meanwhile, Ms. Todd has arranged a patchwork of temporary solutions. She occasionally text messages her symptoms for minor ailments to a doctor friend and gets his advice. She takes advantage of free services at Planned Parenthood. And she considers herself fortunate to be healthy. "I don't even make enough money to move out of my parents' house, let alone afford health insurance," Ms. Todd says.
Going without coverage isn't an option for some people. Cole Murray was diagnosed as an infant with aortic stenosis, a congenital heart defect. He has had five open-heart surgeries and two pacemakers and spent 10 days in a coma when he was 19. His medical costs in 2003 alone totaled $750,000, covered through his parents' insurance.
Mr. Murray's family lives in Indiana, and when he graduated from Columbia College in Chicago with a degree in film, he took advantage of his home state's law that allowed him to remain on his parents' policy an extra year. Now, Mr. Murray is paying $476 a month for Cobra coverage, which extends his parents' coverage until January, when he turns 25. Cobra is a federal law that provides continuation of group health coverage that otherwise might be terminated.
"Most people can spend a couple of years without health insurance, but I don't have that option," he says. Mr. Murray moved to Los Angeles last fall to pursue a career in film. If he doesn't line up a job with health coverage in the next few months, Mr. Murray says he will move back to his home town and look for any job that offers insurance.
Laura Roeder, 23, opted for a high-deductible policy after she graduated from University of Texas at Austin and started her own freelance Web design business in Chicago. She pays $60 a month for coverage through Humana Inc. But since none of her medical expenses under $5,000 are covered under the policy, she avoids routine visits to the doctor. She copes with colds and the flu by ingesting high-dosage vitamin C drinks.
"I'm going to stay self-employed," she says. "And [health insurance] is not suddenly going to become affordable."
Mr. Ngo says that after graduating from New York University with a theater degree, he "bounced around" between unpaid and low-paid internships and personal-assistant jobs in New York City. None offered health coverage. While uninsured, Mr. Ngo says he contracted a nasty flu. But fearing a big bill, he opted not to seek care. Although he got well on his own, the experience scared him.
Mr. Ngo says he got the idea to enroll in a community college in order to get back on his parent's coverage after hearing about the plan from a friend. "I never did anything for class," Mr. Ngo says. "For me, 300 bucks for a semester's health insurance was a good deal. So I thought why the hell not?"
In March, Mr. Ngo got a job as an assistant to a Broadway producer in New York. After 90 days on the job, he qualified for his employer's health insurance, for which he pays $32 a month. He withdrew from the community college, receiving incompletes for his classes.
Posted in the WSJ June 17, 2008
Health Insurance Companies rated by AMA
The AMA will return the favor of the health insurance industry by rating the business practices of health insurance plans that it says can slow payments to doctors and often confuse consumers.
The national physicians group will provide a report card that examines the timeliness and accuracy of claims processing of 7 national health insurance companies, as well as Medicare.
While the report card is aimed at helping doctors negotiate contracts with health insurers and reducing claims-related costs, the AMA said it also could lead to improvements in consumers' understanding of their medical bills and how medical care is priced.
The national physicians group will provide a report card that examines the timeliness and accuracy of claims processing of 7 national health insurance companies, as well as Medicare.
While the report card is aimed at helping doctors negotiate contracts with health insurers and reducing claims-related costs, the AMA said it also could lead to improvements in consumers' understanding of their medical bills and how medical care is priced.
Monday, June 16, 2008
Kentucky & Indiana Insurance Rates
Kentucky and and Inidana residents are having a tough time with rising gas prices like everybody else but may find some savings when insurance bills arrive.
Auto insurance rates in Kentucky and Indiana are expected to fall for a second year, and homeowners insurance rates should rise only slightly after years of steeper climbs.
Competition among insurance carriers and a small amount of weather damage in recent years appear to be driving the trend.
The average auto insurance premium in Kentucky already has dropped 0.4% in 2008, on top of a 1.3% decline in 2007, according to the state Office of Insurance.
Private insurance carriers are becoming more savvy about how they project risk, with a growing number placing emphasis on a person’s credit score.
That can mean lower rates for some people, but not everyone.
Insurance rates also follow a cyclical pattern, with rates that fluctuate based on the level of claims from natural disasters and other events. Insurance rates skyrocketed after the Sept. 11, 2001, terrorist attacks, followed by much smaller increases in recent years.
In 2005 auto insurance premiums in Kentucky were the 26th most expensive nationally, while Indiana’s were 41st. Kentucky was 39th for homeowners insurance, and Indiana was 36th. The priciest states were New Jersey for auto and Texas for homes. The cheapest were North Dakota for auto and Idaho for homes.
Auto insurance rates in Kentucky and Indiana are expected to fall for a second year, and homeowners insurance rates should rise only slightly after years of steeper climbs.
Competition among insurance carriers and a small amount of weather damage in recent years appear to be driving the trend.
The average auto insurance premium in Kentucky already has dropped 0.4% in 2008, on top of a 1.3% decline in 2007, according to the state Office of Insurance.
Private insurance carriers are becoming more savvy about how they project risk, with a growing number placing emphasis on a person’s credit score.
That can mean lower rates for some people, but not everyone.
Insurance rates also follow a cyclical pattern, with rates that fluctuate based on the level of claims from natural disasters and other events. Insurance rates skyrocketed after the Sept. 11, 2001, terrorist attacks, followed by much smaller increases in recent years.
In 2005 auto insurance premiums in Kentucky were the 26th most expensive nationally, while Indiana’s were 41st. Kentucky was 39th for homeowners insurance, and Indiana was 36th. The priciest states were New Jersey for auto and Texas for homes. The cheapest were North Dakota for auto and Idaho for homes.
Friday, June 13, 2008
People Need Good Health Insurance
A recent study has shown that when Ohio residents buy individual health insurance or through other groups (other than employers) they usually don't have very good health insurance coverage.
The report shows, "We need to not only insure more people, but we also need good health insurance," Connecticut Attorney General Richard Blumenthal said.
Besides the 47 million uninsured Americans, the Commonwealth Fund reported this week that another 25 million have inadequate coverage, while still spending a disproportionally high amount on health insurance.
Most Americans have group coverage, but the individual health insurance market of 27 million is growing as employers drop their health plans or hire more independent contractors without benefits
Auto Insurance and $4 Gas Prices
Car owners who are changing their driving habits because of soaring gas prices may be able to save a few dollars on auto insurance.
Major auto insurers including State Farm Mutual Insurance Cos., Travelers Cos. and Farmers Insurance Group say that drivers who log less than about 7,500 miles a year may be eligible for "low mileage" programs that reduce premiums an average of about 10% to 12%. State Farm's program earns drivers discounts ranging from 12% to 18%, says spokesman Dick Luedke.
Car owners who drive more than that but less than they used to -- perhaps because they have started using public transportation or walking to work -- may also save on premiums, according to a study by the Consumer Federation of America. The group released a study Tuesday showing consumers could save 5% to 15%, amounting to $47 to $142 a year based on 2005 rates, when the average U.S. premium was $949, by cutting their mileage enough to drop into a different ratings category, say, from "drive to work" to "pleasure driving," says J. Robert Hunter, insurance director for the Consumer Federation of America.
"Most insurance companies have a scale, and you pay more based on how much you drive. Each time you drive more, they charge you more," Mr. Hunter says. Depending on ratings factors allowed by state regulators, the savings can be even greater, he says.
In California, for example, companies charge motorists based mainly on their driving history and miles driven, so driving more or fewer miles significantly affects the premium drivers there pay. Consumers should inform their agents of any big changes in their driving habits, says Mr. Hunter.
A few insurers in some states also give discounts to drivers who enroll in programs that use an installed monitoring device to track driving habits. The insurers charge drivers according to when, how, and how many miles they drive, so that those who log fewer miles pay less.
Progressive Group of Insurance Cos. pioneered its "MyRate" program, formerly known as "TripSense," in Minnesota, Oregon and Michigan several years ago, and anticipates rolling it out in six more states in the next few months, pending regulatory approval. In those states, drivers get a 25% discount off regular rates for participating. The discount is expected to be even larger in the expanded program, says Richard Hutchinson, usage-based insurance general manager. Progressive also offers a low-mileage discount in four states. Since July 2007, GMAC Insurance from General Motors Corp. has offered eligible On-Star subscribers who drive less than 15,000 miles savings of up to 54% on their premiums, including an automatic 11% discount. The program is available in 34 states.
Several insurers, including Travelers and Farmers Insurance Group, a unit of Zurich Financial Services, also have rolled out discounts for drivers who switch to hybrid and other gas-saving vehicles. Since 2005, Travelers recently started offering a 10% discount on most coverages for owners of hybrid or other gas-saving cars in 44 states. The company says that hybrid-car owners are generally good risks. Farmers also offers an average 5% discount nationally on all major coverages including liability and property damage, says spokesman Jerry Davies.
Major auto insurers including State Farm Mutual Insurance Cos., Travelers Cos. and Farmers Insurance Group say that drivers who log less than about 7,500 miles a year may be eligible for "low mileage" programs that reduce premiums an average of about 10% to 12%. State Farm's program earns drivers discounts ranging from 12% to 18%, says spokesman Dick Luedke.
Car owners who drive more than that but less than they used to -- perhaps because they have started using public transportation or walking to work -- may also save on premiums, according to a study by the Consumer Federation of America. The group released a study Tuesday showing consumers could save 5% to 15%, amounting to $47 to $142 a year based on 2005 rates, when the average U.S. premium was $949, by cutting their mileage enough to drop into a different ratings category, say, from "drive to work" to "pleasure driving," says J. Robert Hunter, insurance director for the Consumer Federation of America.
"Most insurance companies have a scale, and you pay more based on how much you drive. Each time you drive more, they charge you more," Mr. Hunter says. Depending on ratings factors allowed by state regulators, the savings can be even greater, he says.
In California, for example, companies charge motorists based mainly on their driving history and miles driven, so driving more or fewer miles significantly affects the premium drivers there pay. Consumers should inform their agents of any big changes in their driving habits, says Mr. Hunter.
A few insurers in some states also give discounts to drivers who enroll in programs that use an installed monitoring device to track driving habits. The insurers charge drivers according to when, how, and how many miles they drive, so that those who log fewer miles pay less.
Progressive Group of Insurance Cos. pioneered its "MyRate" program, formerly known as "TripSense," in Minnesota, Oregon and Michigan several years ago, and anticipates rolling it out in six more states in the next few months, pending regulatory approval. In those states, drivers get a 25% discount off regular rates for participating. The discount is expected to be even larger in the expanded program, says Richard Hutchinson, usage-based insurance general manager. Progressive also offers a low-mileage discount in four states. Since July 2007, GMAC Insurance from General Motors Corp. has offered eligible On-Star subscribers who drive less than 15,000 miles savings of up to 54% on their premiums, including an automatic 11% discount. The program is available in 34 states.
Several insurers, including Travelers and Farmers Insurance Group, a unit of Zurich Financial Services, also have rolled out discounts for drivers who switch to hybrid and other gas-saving vehicles. Since 2005, Travelers recently started offering a 10% discount on most coverages for owners of hybrid or other gas-saving cars in 44 states. The company says that hybrid-car owners are generally good risks. Farmers also offers an average 5% discount nationally on all major coverages including liability and property damage, says spokesman Jerry Davies.
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