My cousin has three cars. He added his youngest teenage son to his policy in September, assigned him to the same car his two other kids are incidental drivers on, no change in rate when son was added. Son has a clean record, full license, is over 18, has been driving since September. Parents policy renews December 20. On November 16 he got his renewal, same as always. Last week he got another notice dated December 1, raising his rates by over $800 for six months. No explanation, and it was on the car that the kids are assigned to but my adult relative is the primary driver.He called, and they said because they did not rate the kid in September, choosing to do it now. This was after the renewal on a 6 month policy was issued but does not go into effect for some weeks
My cousin would have no objection (other than the money!) except:
He was already renewed at the lower rate, this is not a new policy and his record is long standing and excellent. He thought you could not have a rate change essentially mid policy unless you change the policy in some way like buy a new car, add a driver (which happened before the renewal), none of which happened
He got no warning or written explanation, simply an updated bill with the new per car breakdown and again, the renewal had already been issued which does not make sense to him. He thought there was some notice period before permitting a policy change, something like 60 days but could be mistaken. Last year when there was a minor policy change, he got the notice months in advance
A quick google search showed that “Legally, auto insurance providers are required to inform you of any changes to your policy within 60 days from the time your contract begins. After this duration, they can make changes only if you are convicted of fraud, you cease making timely payments, or your license is suspended or revoked.”
Any changes of address, license suspension, new car, accident, tickets etc? If nothing like that I would definitely call, it could be a clerical error, or if they give the run around, shop a different company. Good luck!
Edit- just re-read your post and the new policy hasn’t gone into effect until Dec 20. Sounds like they just re-ran the policy and rates went up. If your cousin hasn’t paid for the new policy yet- sounds like you are SOL.
He already called, the agent kept saying “we did not adjust him in September which is why are are rating him now”.Will call again if he has to although does not sound good. Still 60 days notice? They had plenty of time to do the adjustment, it was early September before September 16, more than 60 days before the renewal date
Has not paid yet, lesson for the future.
Also, isn’t a renewal essentially a promise to continue the policy and the rate for which is being presented that an insured can rely? It is provided in advance so that if you are not happy you have time to shop around? This feels like a bait and switch, has been with the company over a decade. Also it is hard to get a new policy with teen drivers and then if anything does happen he could be canceled more easily, there will be no accident forgiveness. It was not the rates in the area, it was specifically because of his son. Other cars did not change at all. No changes, no accidents, credit is excellent, employed etc
Not exactly the same scenario but the insurance companies love to play games. I had Progressive and the rate went up about $600 for a 6 month term with no changes on my end. I shopped my coverage and got an online quote thru Geico that was about $500 less (so a net of about $1100 less taking into consideration the rate hike etc) I went thru the whole process of verifying information and got to the payment page. All the numbers looked right and clicked “next” to enter in my credit card info. All of a sudden the rate went up over $1200! I would try to reach out to an insurance broker or try some other online only companies which I have found to be more competitive.
Why didn’t your cousin ask why there was no policy increase when adding the additional driver in September? Essentially, he had the additional driver on the policy for 3 months at no charge.
I have seen similar scenarios where there is no change in premium until the policy is set to renew.
Once they send you a renewal they should honor that. Also have them check their CLUE report for errors and shop around. That doesn’t sound unusual for a new teen driver, and it’s a good time to double check they have enough coverage/umbrella.
Lots of good insurance related discussion/tips in these recent threads
I do not think most people would call their insurance company and ask why their rate did not increase. I am as honest as they come, but if my carrier did not change anything, I would not alert them to that fact (because they will most likely jack up your rate).
Regarding the OP’s question, it happens all the time. When the offer for renewal is sent, I always anticipate an increase. Unfortunately, insurance companies do not exist to do you favors.
I was just sent my offer this past week, and there was no increase. But there is a reason, and my insurance company knows why.
I don’t have any insights in carriers decisions, but what might be the reason is that he didn’t put the kids as primary drivers on any of the 3 cars, and when someone at the insurance saw 3 cars with 3 drivers he figured that kids will be driving the car’s essentially he misrepresented in which case he has no leg against the insurance company.
The issue is that the offer of renewal was sent on November 16 and there was no increase, listed 5 drivers including the teenager. Nothing has changed since September. He has not had a major increase in recent memory (not talking about $20 per car but something significant). He also has no claims and has been with the same insurance company
December 1, later a new bill for a total of $800 more was sent in the mail with no explanation which he just got now and the policy renews next week. That is his objection. If the renewal on November 16 had the higher rate he would have been annoyed but said oh well, they can. Also, if he had gotten notice 60 days prior he would have shrugged and accepted that this is their right to raise rates. He got a reminder bill he thinks at the old rate in late November. Then the new rate last week.
I appreciate what you are saying but He has had three cars with 4 drivers since 2019 and the kids really do not drive much
This was an oversight by the insurance company/system error…which rightfully so got corrected, just quite some time later. Completely legal and valid. At this point, he should be grateful he got away with 3 months not paying for a new driver.
As a broker myself, anytime you add a brand new driver to your insurance policy I ALWAYS shop my clients or advise others to do the same. It’s amazing how different companies rate when it comes to new, youthful drivers…Company A you might see a 20-25% increase while Companies B and C will double/triple the premium.
Would definitely advise your cousin to take a look around, and definitely use a broker. We are able to run all reports on our end and can give you a firm/final premium in addition to shopping with multiple companies…doing it yourself can lead to instances like one of the previous posters before (all looks well until payment then BAM, increase! Progressive, LM and Geico are notorious for this). Also be sure that he discloses if his son and other kids maintain a 3.0 GPA as they will be eligible for a good student discount…that can make a MASSIVE difference.
Definitely just typed far more than I meant too…I need to call it a day lol. Best of luck!
