EMAIL SIGN UP!
The press releases posted here have been submitted by
For further information or to comment on this press release, please contact the organization directly.
Most Popular This Week
- Arctic Methane "Burp": A Climate Catastrophe with $60 Trillion Pricetag
- Obama 'Disappointed' with Release of Celebrated War Reporter
- Edward Snowden's Not the Story. The Fate of the Internet Is
- Democratic Establishment Unmasked: Prime Defenders of NSA Bulk Spying
- Chief Justice Roberts Stacks Secret Court with Govt 'Yes Men'
Today's Top News
FOR IMMEDIATE RELEASE
California Adopts Flawed Mileage-Based Auto Insurance Regulations
New Policies Miss Opportunity to Reward Low Mileage Drivers and Reduce Pollution
SACRAMENTO, Calif. - October 19 - The Natural Resources Defense Council today said that new California "Pay As You Drive" insurance regulations will not likely save Californians money nor significantly reduce global warming pollution. The final regulations, which merely permit insurance companies to verify the miles their customers drive, can be found here.
"Our auto insurance policies are sorely behind the times," said Justin Horner, NRDC transportation policy analyst. "No one should be fooled. The new regulations proposed today cannot be characterized as green. They are nowhere close to what is needed to help the environment or reduce global warming pollution."
Pay As You Drive (PAYD) insurance directly ties the amount you drive to the amount you pay for auto insurance: if you drive less, you pay less. Under current regulations, drivers usually pay as much for auto insurance whether they drive five miles a month or five hundred. Strong PAYD rules could reduce global warming pollution and save drivers money. However, according to NRDC, the regulations put forward by the Department of Insurance will not likely result in effective PAYD programs and will have little, if any, meaningful impact on California's environment.
"Because mileage verification in the regulations is entirely voluntary, there is no evidence that any insurance companies will make the switch," Horner said. "The regulations weaken driver privacy and make insurance pricing less transparent - changes the insurance industry lobbied for - but still offer no timeline or proposal for when, or if, drivers will see any PAYD policies in California."
The regulations permit verification but do not require, or even provide guidance on, effective mileage pricing. In short, setting up mileage verification programs is not the same as offering PAYD insurance.
Instead of requiring insurance companies to offer PAYD insurance policies, the final regulations merely permit insurers to offer a voluntary mileage verification program. In return, insurers are permitted to offer discounts to drivers to have them enter such a program and determine their rate based on additional factors. The regulations also allow insurance companies to require drivers, as a condition of their participation in a mileage verification program, to install a mileage tracking device in their vehicles.
Background on PAYD policies in California:
In 1988, voters demanded change to auto insurance in California and passed Proposition 103, requiring the number of miles driven to be the second-most important factor in determining insurance premiums, after driving safety record. Advocates across California have asked the Department of Insurance to better implement Prop 103 and require insurance companies to more closely correlate premiums with the number of miles their customers actually drive. NRDC advocated for mandatory mileage tracking programs without requiring drivers to install tracking devices, and lobbied for tight mileage bands to correlate greater savings with the fewer number of miles driven annually.