News You Can Use

Prop 103 Territory Changes

NEW REGULATION - ELIMINATES RATING TERRITORIES AS A PREDOMINANT FACTOR IN RATES...

Implementation of a final provision of Proposition 103 - which eliminated territory (zip code) rating as a predominant factor in determining and setting rates is set to take effect effective October 1, 1997.

Traditionally rates were based on driving record, years of driving experience, and the area you lived. Generally Urban area drivers paid more and non-urban drivers based on the "frequency and severity" of losses (accidents/thefts/vandalism/etc) in the area. This regulation is supposed to eliminate "red-lining" and even out rates across the state.

All auto carriers are affected by this change, yet most carriers have tried to minimize the affect of changes in rates to their policyholders. However, due to the leveling of rates, most consumers can expect renewal offers received after October 1, 1997 will reflect a minor change to their area (up or down) and in their rate as their carrier complies with the regulation.

In addition, now that more emphasis will be placed on years of experience and driving history/record, the affect of additional driving record points acquired may greater affect your rate.