Automotive insurance coverage corporations have been placing clients via it recently. Ever rising prices of doing enterprise have prompted insurance coverage corporations to improve charges or outright make it laborious to get coated. Others are taking issues a bit additional to get more cash out of shoppers. Take Progressive, who added a driver to a person’s insurance coverage who he says doesn’t exist, which additionally elevated his premium.
CBS Information reported on the unusual state of affairs involving 31-year-old Ed Fan out of Denver, Colorado. Fan advised CBS he’s single, lives alone and is the one person who drives his 2019 Jeep Wrangler. But his insurance coverage service Progressive not too long ago added one other, unknown driver to his coverage, which he says elevated his six-month premium by $312.
“I don’t know” who the supposed new driver was, mentioned Fan. “I’m the one driver on my car,” he mentioned.
He repeatedly known as and emailed Progressive, attempting to get them to take away the costs — and the unknown individual — from his auto insurance coverage coverage.
“It does seem the burden falls on me to show this individual doesn’t exist and isn’t associated to me or drives my car,” mentioned Fan, who mentioned he was caught off guard by Progressive’s assertions that he needed to pay for one more licensed driver in his dwelling, driving his Jeep.
“I didn’t even know they may to that,” he mentioned.
Fan isn’t alone. CBS Information says on-line boards produce other Progressive clients complaining about the identical factor occurring to them: regardless of being the one driver on their insurance policies, Progressive added a random driver, rising their premium. CBS says one lady wrote that Progressive had added her “ex husband, my brother, my God daughter and son” to her coverage regardless of her not having had contact with any of them for over a yr. The corporate added a $1,700 price to her coverage because of this.
A Reddit submit from 2022 detailed one other Progressive insurance coverage buyer asking for recommendation after the corporate added two drivers to their coverage, one in every of which was 16 and drove up their premium $300. One of many replies from a former USAA insurance coverage agent defined that what’s occurring is known as “driver discovery.” From Reddit:
So what Progressive did is known as “Driver discovery” Insurance coverage corporations examine public information every now and then to see if there are a number of individuals (of driving age) at an handle, and sometimes they ship you a letter stating that since they found a possible driver at your handle, they could have so as to add them to your coverage, until you name and clarify why you haven’t added them.
Mainly, because the New York state insurance coverage dealer Bruce Swicker defined to CBS, insurance coverage corporations are assuming issues till you clarify in any other case. “If they’re within the family, the belief is that in some unspecified time in the future since they’ve entry to the car that they could very effectively drive it.” Individuals transfer or info adjustments and lots of typically neglect to replace their insurance coverage. This causes what’s identified within the trade as “premium leakage,” which is seemingly an enormous downside for the trade, costing over $10 billion yearly.
As for Fan, it took weeks of forwards and backwards and a criticism filed with Colorado’s insurance coverage regulators, however Progressive lastly eliminated the unknown driver and the premium cost. Fan nonetheless needed to signal a doc saying that he didn’t know the one that they mentioned lived with him. And the corporate wasn’t precisely forthcoming with how they acquired the knowledge on this different “driver.” CBS Information says the corporate didn’t say the place they acquired the information from nor did they handle different situations of this occurring.
…in an announcement to CBS Information Colorado, Progressive didn’t specify the place their details about a ‘hidden driver’ in Fan’s home got here from or why that title was added to his coverage. The corporate didn’t handle different, related complaints CBS Information Colorado shared with the corporate. Ron Davis, with Progressive Insurance coverage’s public relations division, as a substitute reiterated the businesses’ procedures for insurance coverage candidates.
“…We additionally repeatedly evaluation info from third-party sources about people who probably dwell within the family and needs to be added to lively insurance policies,” wrote Davis. “When info is discovered, we contact the policyholder to confirm the knowledge. Figuring out potential lacking driving-age family members/drivers and dealing with the client is vital.”
