Farmers seeks rate hike for auto insurance

Monday, March 10, 2003 | 9:21 a.m.

CARSON CITY -- Car insurance costs could soon go up for 180,242 vehicle owners in Nevada, including 96,236 in Clark County.

Those are the numbers of auto insurance policyholders covered by Farmers Insurance Exchange, and the company has applied to state Insurance Commissioner Alice Molasky-Arman for rate increases. If the company's request for rate changes is approved, some motorists will see hefty increases, while others could see only a slight rise in their premiums if the application is granted because some of the requested increases could be offset by increased discounts, officials said.

The company is asking for across-the-board increases of 17.2 percent for bodily injury-property damage coverage, which is the core of minimum coverage required for all drivers. The company also wants additional increases in other areas of auto insurance: 11.5 percent for uninsured motorist coverage, 1.2 percent for medical coverage, 6.1 percent for comprehensive coverage and 7.5 percent in collision coverage.

But Chuck Knaus, actuary for the state Insurance Division, said Farmers also would offer a discount of up to 9 percent for motorists with good credit and good driving records. And there would be discounts of up to 4 percent for other things such as the age, sex and classification of the drivers.

Those who insure their homes in tandem with their vehicles will get a discount, and some policyholders with multi-car coverage will get discounts.

For those who qualify for all the discount categories, the bodily injury-property damage required coverage by the state will be rising an average of 1.5 percent. There would be no increase in uninsured motorist; a 1 percent increase in medical; a 2 percent rise in comprehensive; and a 6.5 percent jump in collision coverage.

He said those who don't qualify for any of the discounts will be hit with the maximum increase. Knaus said there is no way to determine what the average increase for an individual would be statewide because of the various factors plus the make and model of the car that is insured.

Farmers last raised its rates by 1.5 percent in November 2002. The new rates would become effective in July this year if approved by Arman-Molasky.

Farmers collected $147.9 million in premiums last year in Nevada but says it needs to take in an extra $4 million a year.

Insurance consumers who want to express their opinions about Farmers' rate increase request can write to the insurance commissioner at 788 Fairview Drive, Suite 300, Carson City, NV 89701-5453. The phone number for the Division of Insurance's Las Vegas office is 486-4009.