Here’s the latest reader question, along with my reply!
Mitch asks: I have a question about insurance that has been nagging me for some time.
I have two children listed as drivers on my auto policy.My renewal is in December, but every July my insurance company sends me a questionnaire asking the following: Do I have any cars insured with other companies; do I have a company provided auto; where are my vehicles located; where are they driven; how many miles daily and annually; who drives them; is the use commuting or pleasure or business; has any driver had a ticket?
These questions generally piss me off because I go over things in detail with my agent whenever I have a change. I am a CPA and tend to be sort of detail oriented about those things. Anyway, the one thing they ask really pisses me off is they want my children’s social security numbers.
Now I know that for years insurance companies have been using credit scores to rate policies. I get it that a credit risk can make for a poor insurance risk or maybe even higher risk for fraud. But they have no right to that information on my children. I am the responsible financial person in my house. I pay the bills for four people. It’s my responsibility and I handle it. It’s my policy, and no one else’s. I tell my agent that every year and I refuse to provide it. I kind of feel like that no one should have your SSN unless they are paying you a wage. Plus if you have ever had your identity stolen, and I have, you know that that info should be given infrequently and safeguarded.
My reply: I am also pissed off. Both by mandatory insurance as such as well as the side effects of mandatory insurance, which include the pushy questioning you’ve detailed. The insurance mafia – and it is precisely that – knows you are under duress; that you cannot say no to insurance, no matter how pushy or overpriced. This encourages insolent, obnoxious questions which – absent duress – would result in most people immediately cancelling the policy.
Yes, you can switch from on mafia “family” to another – but because they’re all government-protected/government-enforced rackets, you have very little meaningful choice and so very little bargaining power. If you cancel you coverage, it will probably result in the next “family” charging you more – based on the fact that you cancelled.
As a practical matter they have us over the proverbial barrel. The one thing you can do is shop for a different “family” without saying anything about it to your current “family” until you are ready to make the switch. In other words, only cancel the policy you have when you have lined up a new one.
Got a question about cars – or anything else? Click on the “ask Eric” link and send ’em in!
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