My Rate is Going Up...... Again?

"What? It's going up again? But I haven't had any tickets or accidents."

     Most people that have had any type of property or car insurance have experienced an increase in cost after being with a company for a period of time. If we got paid based on the number of times we heard people repeat the above statement, we'd be in high cotton. Insurance rate stability is as elusive as that pink unicorn in my backyard. Brent crude just topped $80 a barrel, and an MRI is like $5000 bucks, but for some reason we've been led to believe insurance rates should remain static. How we were led to believe this, I'm not quite sure. But I'm going to try to offer a little perspective, not to defend the insurance industry as a whole, but to possibly save you some angst when that pesky renewal bill comes.

     Why do rates fluctuate, sometimes down, more times up, with little or no quantifiable explanation? I'm hardly qualified to give technical explanations, as I am not an actuary(read bean counter, for insurance companies). So we'll try some things that are more easy for us to relate to. Insurance companies are complex organizations that have many different moving parts.

     Most people think they profit directly from insurance premiums, and to some degree they do, but that's only a piece of the puzzle. One of the challenges is the puzzle is constantly changing. Offering insurance for cars or houses at rates that will be both competitive in the marketplace and yield a profit to the company is very difficult.

     That new $50,000 Suburban is a lot more expensive to repair than your parents 1988 Buick. Backup cameras, plastic panels, 42 air bags and a concert hall in the dash cost a bit more to repair than a real metal bumper with real metal fenders and 15" steel wheels. Shoot, some of the wheels and tires on these new cars are more expensive than the actual cars were 20 years ago! ( not really, but you get my point) Then there's the impact of claims and the cost to settle them. I know we want to argue that we shouldn't have to pay for other people's mistakes. But when a business incurs expenses beyond their budget, they have to make up the extra cost by raising prices. And insurance companies are businesses too. For example:

     Have you paid an electric bill lately? How about defend 10,000 computers against hackers that want to hijack all your data and sell it to the highest bidder? Do you like to get pay raises every now and again? Had to pay your legal team to defend against fraudulent cases brought against your customers, or even worse, your own customers trying to get over on you by filing a $10k claim for a $6k loss.

     According to an ongoing study by the Insurance Research Council, up to $7.7 billion in auto insurance injury claims filed in 2012 were fraudulent or contained padded figures. That’s a 33% jump from the $5.8 billion reported in 2002. And those numbers are now six years old. Fraud alone could account for several hundred dollars of your yearly premium.  This is just a sampling of factors that affect the ongoing operating costs of insurance company. And that doesn't even begin to consider the impact of government regulations and taxation that are constantly changing. 

     Insurance companies are always having to look ahead, setting rates now for what could happen in the future. They are required to file their rates with the states in which they operate, and must adhere to those rates. And unfortunately, they can't predict the future any better than you or I can. I may sell insurance, but I'm a consumer too. And my rates usually go up a little each year too. One of the best defenses against rate increases is having an independent agent that can shop for the best value for your situation at any given time. We aren't beholden to any single company. When one company's rates get out of line, we've got many others to consider. And that just makes good sense. 

April Snow Showers Bring....

     My mom reminds me quite often that when she brought me home from the hospital on April 6th, 1972, that it was snowing. Forty six years later and it's still snowing in April. Almost 50 years and the weather is just as unpredictable as it was in the 70's. I guess the increase in technology gives us this notion that we should be able to predict the weather, since we have an app for that and everything else under the sun.

     And if we do have an app for everything, will someone please direct me to the parenting app? 'Cause I can't seem to lay my hands on it, and it needs to start telling my kids what to do so I can take a nap. Seriously, kids don't need us telling them what to do anymore. This isn't the 70's, or the 60's, 50's or 40's. At this point, Apple should be able to claim about 30 million kids as dependents on their taxes, right? So why can't they aggravate Siri into making dinner? Why can't Youtube teach them how to clean the toilet and empty the litter box? Shouldn't Snapchat feel morally obligated to instill values into my kids since they spend more time with them than me?

     Surely that group at Instagram can find a savvy way to compel kids to not bully each other and to esteem others higher than themselves. And I am most confident that Netflix can give them at least 13 reasons to live honorable and worthwhile lives, if for no other reason than to be future customers. And let's not forget the Twitterati and the wealth of compassion that they impart 24 hours a day. 

     Now that I've had time to consider it, maybe my kids need me after all. Maybe technology doesn't have all the answers. Where does that leave me? I guess I'm in the same position mom was in 1972 when she brought me home from the hospital in the snow. It's still snowing in April, babies are still being born to real mommies and real daddies and it's harder than ever to raise a child into a loving, caring, compassionate man or woman who can contribute to the good of society.

     This truth makes it incumbent on us dads and moms to esteem our spouses, to honor and defend Biblical truths, and to re-assume the role of being the primary influence in our kid's lives. The crud that tech is feeding them is garbage in light of morality. Peers raising peers is a guaranteed path to destruction. And the damage doesn't show until it's too late. Parents, we may diverge on rearing methods, but let us agree that no one and no thing will ever be able to fill our shoes as the best leaders for our kids. And if and when we come up short, let's not rely on Google for the answers, but find somebody that's been where we are and ask for some help.

     Find a mentor or be a mentor. The art of raising children has been taught by grandmas and grandpas for thousands of years. And I think they've done a better job than Facebook. 

Rural America: Old Fashioned? Maybe.

  As I look around the great metropolis that is Martinsville and Henry County, I realize that there's a stark fact that binds us with much of the rest of these United States. We're pretty old fashioned! 

     Now to some that may seem derogatory. But on the contrary, I like the way things have been in the past. Years past have an allure, nostalgia we often call it, we remember when life seemed to be less complicated.

     Simplicity is elusive these days for many people. Between the two working parents and the three kids in four sports, the speed at which life is lived can be overwhelming. But, as we venture further into the countryside, beyond subdivisions and strip malls, time slows down. We see things as they have been: old farmhouses, barns, country stores. It appears they have always been there and always will be there.

      We have a tradition of going to the Ayers-Kreh Christmas tree farm in Patrick County each year and cutting our own tree. To prove my point, time stands still at the Cristmas tree farm. I've been going there for 30 or so years. I can stand on the hill, facing west, with the cold breeze stinging my face, and remember being 13 years old in the same place. I'm sure the personnel and the equipment have changed, but I don't see it. I'm just a kid looking for the perfect tree, 30 + years later.

     I happen to live on Highway 58 and often see the vehicles passing by with their perfect tree strapped to the roof or hanging out of the bed of the truck. Maybe they are living out the same tradition that I am with my family. Maybe they are starting a new tradition. Now many of our more urban friends and family may find the idea of hunting and killing your own tree preposterous.

     Drinking hot chocolate on a cold December Saturday, they say? At a farmhouse in the middle of nowhere, they quip? That just sounds old-fashioned. Well, maybe it is. But, don't knock it til you've tried it. You may discover that you've got a little nostalgia in you, too!

Zachary BradyComment