Contact Us

Car Accidents
*    Denotes required field.

   * First Name 

   * Last Name 

   * Email 


Cell Phone 

Street Address 

Zip Code 



Date of accident : 

State in which accident occurred:

Do you have a copy of the police report?

Please describe your accident and resulting injuries:

For verification purposes, please answer the below question:

No Yes, I agree to the Parker Waichman LLP disclaimers. Click here to review.

Yes, I would like to receive the Parker Waichman LLP monthly newsletter, InjuryAlert.

please do not fill out the field below.

SUV Owners Red-Flagged

Jan 13, 2003 |

Perched higher on the road and surrounded by more bulk weight, drivers of sport-utility vehicles enjoy a greater level of safety in accidents, often at others' expense.

Many are beginning to pay more for that perceived safety in the form of higher auto-insurance premiums.

The insurance industry is looking closely at its claims data to determine how the mounting presence of SUVs - which now account for 21 percent of new car sales - is affecting damage and injury claims from drivers of subcompacts to full-size cars.

The idea of pricing according to the damage that individual SUVs inflict is beginning to catch on among insurers, said Bob Hunter, director of insurance for the Consumer Federation of America.

While the Insurance Institute for Highway Safety doesn't measure crashes for impact on other cars, the physics of an SUV's impact on a smaller car is well demonstrated in insurance claims because of the weight difference, he said. "The people in the SUV are going to do better given a certain degree of force in an accident than people in a car."

As a result, many insurers are starting to surcharge the liability premium, which covers others involved in a crash, while giving a discount for the medical premium, which pays for injuries that occur inside the SUV, but one usually doesn't offset the other equally, he said. The liability line often comprises 40 percent of the total premium while medical payments make up just 10 percent.

"You're going to pay less for medical payments and more for liability, but since liability is a much greater share of the premium, if you're an SUV owner, your policy is going to cost more," Hunter said.

"The SUV policyholder will pay about $40 more than a typical car for liability and medical payments combined for occupant protection in and out of the car."

Safety a driving factor

To be sure, a perception of invincibility helps make midsize and large SUVs a popular choice among U.S drivers.

In fact, light trucks, which include SUVs, pickups, vans and minivans, outsold passenger cars for the first time in U.S. history in 2001, comprising 51 percent of the market, according to the Alliance of Automobile Manufacturers.

But SUVs aren't just taking over America's roads -- they're also increasingly redefining how insurers rate their injury risk. State Farm, the No. 1 U.S. auto insurer with 40 million policyholders, is studying the issue. Allstate began evaluating SUV liability separately in 1999. Progressive has been in the habit since the 1980s.

Allstate and Progressive charge different rates for bodily injury liability caused to others outside the SUV, and for medical payment or personal injury protection, which covers the vehicle's occupants, Insurance Information Institute spokeswoman Carolyn Gorman said.

"They have claims history that show large, high-riding, heavy duty SUVs do cause greater damage to other people and cars," she said. "They do charge higher premiums based upon the size of the SUV."

Allstate, for example, sees liability losses in the large SUV group, including the Lincoln Navigator and Ford Excursion, coming in 7 percent higher than the average for all vehicles, and the company began passing along those expenses two years ago, spokesman Mike Trevino said. At the same time, it gives breaks up to 15 percent in the medical payment category for SUVs that do a good job protecting their passengers.

"What Allstate is doing is attempting to price the policy more accurately," Trevino said. "The new rating methodology accounts for the different loss experience that vehicles have. If your vehicle has a higher liability cost if that vehicle type is causing more injury or more damage to other cars then that's being reflected in the rate."

The attitude is similar at Progressive, spokeswoman Leslie Kolleda said. "We're in the business of pricing a policy to recoup our costs. If a particular make and model, whether big or small, has a claims history greater than a similar make and model, then we price them differently to the make and model."

Reviewing its records

Despite other insurers' moves to price SUV rates separately, State Farm doesn't rate liability to outsiders differently based on make and model history. Still, it offers a "vehicle safety discount" on the medical payments side according to its claims data, spokesman Dick Luedke said.

One reason for the pricing imbalance is that larger vehicles tend to be involved in fewer crashes, he said. "The severity tends to be greater when involved with another car, but the frequency seems to be less. I'm not sure why that's the case, but it makes sense that larger vehicles are easier to see and when you're in a larger vehicle, you tend to be up a little higher and you can see a little better."

"The extent of the injury you sustain in an accident has much more to do with the vehicle you're in than the vehicle that hits you, if there's another vehicle involved in the crash," Luedke added.

Still, the company is studying whether it makes sense to start calibrating liability rates to its claims patterns, he said. State Farm is "weighing the ability to measure it perhaps a little more accurately versus the cost of administering the system."

Related articles Other articles
Parker Waichman Accolades And Reviews Best Lawyers Find Us On Avvo