The "Farmers Insurance News-Alert" website is dedicated to providing the consumer and general public with detailed information concerning the Farmers Insurance Group. This includes fraud reports, consumer complaints, lawsuit's and other legal actions taken against this company. All information contained herein is for educational purposes only. Original sources, when known are sited.
|Wednesday, October 23, 1991
UCAN Report Says Auto Insurance Firms Unscrupulous, Overpriced; Survey: The consumer group accuses some companies of 'bait-and-switch' tactics, and says the various policy offerings only confuse the average customer.
By: JOHN H. LEE (TIMES STAFF WRITER)
The UCAN study concludes that, during the three years since the state insurance reform
initiative, Proposition 103, went into effect, the cost of insurance has risen to levels
similar to that of a monthly car
The report also says that several companies are not providing the minimum insurance
coverage mandated by Proposition 103 and are in violation of state law. It blames the
California Department of Insurance
Officials at the insurance department generally agreed with the report's findings and said action is already being taken on many of the problems addressed in the survey. "We think the UCAN report was very well done, and it does identify serious problems with insurance selling practices," said Tom Epstein, deputy commissioner for consumer protection at the insurance department. "The report rightly suggests better enforcing of the state guidelines. We have been looking into the problems."
Epstein said the department also conducted a rate survey of the state's largest companies and will be releasing the results in about two weeks.
A spokesman for an insurance lobbying group that represents three of the companies
surveyed by UCAN said he had not seen the results of the study, but disputed any
assertions about unscrupulous practices.
"It's interesting this became a media event before they tried to contact the
insurance companies that are affected," Fountain said. The survey group included
insurance carriers using exclusive agents and independents who write policies for several
companies. The eight carriers--Farmers, State Farm, 20th Century, Mercury, USAA, GEICO,
Progressive and AMICA--included small, medium and large companies.
In inquiring about specific rates, UCAN created three "family profiles."
Different ages, addresses, number of drivers in the family, number of cars and driving
records were established. Each "family" called all of the companies, and
sometimes different agents in the same company were called to determine if there were
There were, according to the study. No two agents gave exactly the same quotes, it
found. In one instance,
A spokesman for Farmers Insurance Co., which UCAN identified as being among the most expensive carriers, said he had not seen the report but questioned UCAN's assertions as they were related by a reporter. "I find it puzzling that they would find a wide difference between the rates we offer and the other companies'," Farmers spokesman John Millen said. "Our rates are very competitive."
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