When They Won’t “Cover” You . . .

  • August 26, 2023

Here’s an interesting juxtaposition:

California, like pretty much all states, forces everyone who drives a car to “cover” it. That is, the state forces them to buy insurance.

Even – in some cases – if they don’t drive it. There are states that require the owner of a garaged (or otherwise stored) car that isn’t driven to be registered – and in most cases, in order get or renew that registration, the vehicle must “covered.” This is revelatory as regards the nature of such “coverage” in that it shows the supposed justification for obliging people who own cars to buy “coverage” – i.e., that it is necessary in order to prevent innocent other people from holding the bag for the cost of injuries and property damage arising from someone else driving a car that isn’t “covered”  to be just that; i.e., supposed.

The real point is to force people to pay.

Money (which buys power) is almost always at the root of whatever it is the Benevolent Ones claim they are forcing us to do for our own good – and the supposed good of others.

But what happens when the insurance mafia won’t “cover” the vehicles that the law requires be “covered”?

We’ll soon see – because that’s just what’s happening in California and it’s likely to spread, as the rest of the country becomes more and more like California.

Reports coming out of the browning state that the mafia is refusing to “cover” the people the law says must buy “coverage.” They are losing too much money “covering” people, says Jerry Becerra of Barbary Insurance Brokerage. “A lot of companies are running a more than 100 percent loss ratio . . . that’s unsustainable over the long-run.”

And why are they losing “too much” money?

According to Becerra, it is due to the “cost of repairing vehicles (being) higher than it used to be due to inflation, type of vehicles, supply chain issues, a lot of things may be driving that.” 

He does not elaborate. So I will.

It is true the cost of repairing vehicles is higher than it used to be – but it is not “due to inflation.” Not fundamentally. The value of money has gone down but the cost of repairs is way up. For instance: Before about a decade ago, it didn’t cost much to replace a cracked windshield. It was typically less than $150, parts and labor. It cost so little many people just paid – out of pocket – to get it done rather than file a claim and give the insurance mafia an excuse to “adjust” what they charged (and people are forced to pay) for “coverage.”

It now routinely costs $400 and in many cases $1,000 or more. That is not due to “inflation” – bad as it is. It’s due to technology. Or – rather – it’s due to the cost of the technology embedded in the glass, that must be replaced along with the glass. A windshield is no longer just glass, you see. In many new cars, it is part of a “driver assistance” system, which has to be replaced along with the glass. And because it routinely costs $400 or more to replace the ensemble, more people file a claim – and pay the deductible. Which means we all pay more “coverage,” since the insurance mafia is not in the business of losing money.

Most new cars have six air bags – or more. Go back ten years and most had four. Go back a little farther and most had just two. How much does it cost to replace four vs. two air bags? Often, it costs whatever the book value of the car was – which is the sum paid out when the car is totaled because it’s not worth fixing.

Who do you suppose is paying for that?

How about the now ubiquitous plastic front-and-rear bumper covers that shear off the car even in relatively minor accidents? The made-of-plastic headlight “assemblies” that cost several hundred bucks each to replace?

EVs are also driving up the cost of “coverage” because they cost more to replace when wrecked (or when they burn to the ground, perhaps also causing the garage and house to burn to the ground, too) and because they are more expensive to replace when damaged. The mafia is very aware of the fact that EV battery packs can be rendered even more fire-prone than they already are if they are subjected to impact forces, as in a crash – even a relatively minor one. But it is not practical to remove and inspect the thousands of individual cells within an EV battery pack to make sure none were damaged as a result of a fender-bender. Given the risk of a catastrophic fire – and the costs associated with that – the mafia will be inclined to order the battery replaced – or the car “totaled.”

And we’re going to pay for that, too.

Or at least, the mafia intends to make us pay for it. In California, the mafia is obliged to get the government to approve general rate increases in the cost it charges for the “coverage” it uses the government to force people to buy; i.e., the cost of “coverage” people who haven’t filed any claims must pay.

But, a point arrives – it has already arrived, in California – at which people can no longer afford to pay for what the mafia uses the government to make them pay for.

At that point, car owners may decide to become the modern analog of Robin Hood’s Merry Men – and thumb their noses at the Sheriff of Nottingham and all the king’s men.

And that may be a fine thing.

. . .

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