My shredder is so lonely: Stop preapproved credit cards and insurance offers coming to your physical mailbox with OptOutPrescreen. You can stop offers for five years or forever. I picked forever.
Insurance rates are through the roof - and you can blame AI
There’s a good chance you’ve been hit with insurance rate hikes — and it’s not just you. Within the past year, about a third of us have been hit with increases to the tune of 17%.
Insurance companies blame it on rising costs for car parts, replacement cards and all those expensive claims.
They are raising rates to keep up with those pricey claims — all while turning a profit. And, surprising no one, they’re using data tracking and AI to make it all happen.
Let’s get into what’s really going on and what you can do to cut costs.
A whole new world
Business Insider dove into the secretive world of the insurance industry — and it’s not pretty. Back in the day, your insurance policy was based on simple demographic data points. Think 36-year-old woman in Phoenix. That’s it.
With more AI tech and data than ever at their fingertips, insurers now know exactly how much customers are willing to pay.
“Price optimization” feeds consumer data into an algorithm that spits out a personalized price for each customer. It’s based on how risky a person is to insure but also considers predicted profits they would deliver for as long as they’re a policyholder.
Insurance companies look at many data points, including if you’ve recently had your roof replaced and what you eat regularly. They can even check your social media posts and know if you’re a smoker.
What’s that got to do with how well you drive? Not much, to be honest. But it does have everything to do with making it harder to find a good deal.
Like they’re in the car with you
Although 68% of Americans oppose using an app that collects driving data, it hasn’t stopped insurance companies from forcing it on us.
Drive a Kia or Hyundai? You might have a hard time getting insurance
Did you know the type of car you drive may impact whether you can get insurance? Like how a smoking habit may affect your health insurance, a lack of safety features might put you in a pickle. If you drive certain Kia or Hyundai vehicles, pay attention. Some insurance companies are refusing these car owners a policy at all.
Your car is watching
Automakers and insurance companies are teaming up to share data on your driving habits. Also, EV sales are struggling, and there are issues with Airbnb. I speak with a guy whose identity was stolen, and now the scammer is using his info to con others.
Car-tracking shocker: Automakers are sharing our driving habits with insurance companies. With help from data brokers (NY Times, paywall link) like LexisNexis, insurers know every move we make — speeding, hard braking, rapid acceleration, you name it. The kicker? This could spike your insurance bill. I suppose we should’ve known this was happening.