Implementing Car Insurance Reforms

While location should have some effect on automobile insurance rates, a fairer system is needed. The higher density of vehicles in the Los Angeles area than in, for example, Eureka, creates a higher chance of a two-vehicle accident in Los Angeles. But it seems unreasonable that one person should pay a significantly different rate than another living on the next block, across some statistical boundary, because of how the territorial boundaries are drawn.

A better territorial rate averaging system should be instituted that takes into account the costs of providing insurance over a wider “shared-use” area within a given radius (at least 20 miles) from the owner’s residence, without arbitrary boundaries.

A plan based on this averaging approach could be fair to both residents of various parts of the state and to the insurance companies. Although it will take more work by the insurance companies, computer support of this system will make it practical.

BOB ABRAHAMS

Los Angeles