The Law Offices of Slatkin & Lupo
Takoma Park Office:
Every insurance company is required to file with the Maryland Insurance Administration their underwriting standards and rates. An insurance company is not allowed to “discriminate” against any particular insured.
Insurance companies are allowed to utilize numerous factors to determine their “risk” and to set rates based upon such risk. These factors include such things as geographic location, age of driver(s), education of driver(s), distance of normal commute, type of job, credit rating, and any other factor that a particular insurance company feels is relevant to their risk. Each person is then put in the same “box” as other people with the same factors, and each person in that box must be charged exactly the same. This results in a computer generated rate which is not subject to individual adjustment. Each insurance company weighs risks differently, and as such a person’s comparable rates may depend on their particular insurance company.
Insurance companies are also allowed to base future rates on an insured’s traffic record and history of at-fault accidents. Once again, such underwriting standards and rates are filed with the Maryland Insurance Administration and must be uniformly applied.
Because each insurance company utilizes different factors and accords different weight regarding the risk of such factors, it makes sense (cents) to shop around to determine the best rates for your particular situation. One insurance company may charge more for less experienced drivers, while another may charge more for the type of car you drive.
For what it’s worth, after 30 years of dealing with insurance companies on behalf of our clients, the only factor we find to be relevant in purchasing motor vehicle insurance is the cost. Regardless of what insurance company you select, the quality of service you receive depends to a large extent on the claims adjuster who happens to be assigned to your claim. Good hands, good neighbors, geckos, and red umbrellas are poor substitutes for cash in your pocket.