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|Insuring big vehicles may cost more
SAFETY: New calculations are in store because pickups and sport-utilities inflict more damage.
By LEON TEEBOOM
The Orange County Register
Some big insurers plan to raise rates for sport-utility vehicles and pickups after research found that they inflict unusually
costly damage to cars and car occupants in collisions. But Orange County residents shouldn't be affected yet.
Los Angeles-based Farmers Insurance Group, the nation's third-largest insurer, and Progressive Corp. already have
begun to re-calculate their rates to reflect the findings.
Other insurance companies said they were reviewing the issue.
Sport-utility vehicles are among the most popular autos sold in Orange County. Residents here registered almost 22,000
new sport-utilities last year, according to R. L. Polk & Co., an auto industry research company.
Some insurance companies are considering raising rates on sport-utilities by up to $300, said Kenneth Adams, a
spokesman for Western Insurance Information Service, a Los Angeles- based trade group. Conversely, car owners might get a break on their rates, Adams said.
``Is it fair for someone with a small passenger car to pay the same rate as someone with a large sport-utility vehicle?''
The higher bumpers and greater weights of Chevrolet Suburbans, Ford Expeditions and similar vehicles make for
an unfair contest in accidents, he said. ``It's like Evander Holyfield going against some boxing wanna- be.''
According to the National Highway Traffic Safety Administration, 5,447 people died in two- vehicle collisions
involving light trucks which includes pickups, sport-utility vehicles and vans and passenger cars last year. Four out of five of the fatalities were people traveling in the passenger cars.
Adams said that while insurance companies are looking at raising rates in several states, they have held off in
California to wait for more definitive data. He said the earliest that truck and sport-utility drivers in California
might see rate increases would be next year.
Most companies are taking a wait-and-see attitude. The insurers are also restricted by state governmental boards
that must approve all rate changes.
Farmer's Insurance, for example, has limited its higher insurance rates for sport-utilities to Pennsylvania, said
``This is so new, we're going to wait to see what happens (before changing rates) in California,'' she said. Farmer's is
the second largest auto insurer in California.
The data driving the potential change in insurance rates comes from a 1994 study from the Washington-based
Highway Loss Data Institute.
In that study, which compared 1991-93 model-year vehicles, large sport-utility vehicles caused 72 percent more
in average costs for the liability damage portion of a driver's insurance bill. That same vehicle, however, cost 31 percent
less than the average vehicle for collision repairs, an indication it was inflicting more damage than it was sustaining.
State Farm Insurance, the state's largest auto insurer, said it didn't plan to raise rates for California sport-utility drivers.
``At this point we don't have any cause to implement any rate (change) for make and model for liability, but we do
rate our cars differently for collision,'' said Rudy Rodriguez, a State Farm spokesman for the Southern California region.
The Associated Press contributed to this report.
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