Volume 2, Issue 4
Life After 50 Expo
Baton Rouge River Center 275 South River Road
Baton Rouge, LA
8:00 a.m. - 3:00 p.m.
District 15 Community Meeting
Scotlandville Branch Library 7373 Scenic Highway
Baton Rouge, LA
6:00 p.m. - 7:30 p.m.
University of Louisiana @ Lafayette
104 University Circle Lafayette, LA
11:00 a.m. - 11:50 a.m.
Family Fun Day and Community Resource Fair
Lockport Bayouside Park
Main Street & Canal Street
10:00 a.m. - 2:00 p.m.
Community Health Fair
Hollywood Street Church of Christ
5111 Hollywood Street Baton Rouge, LA
9:00 a.m. - 1:00 p.m.
Kiwanis Club of South Baton Rouge Health Fair Day
McKinley Alumni Center 1520 Thomas Delpit Drive Baton Rouge, LA
10:00 a.m. - 2:00 p.m.
Desoto Council on Aging
404 Polk Street Suite A Mansfield, LA
University of Louisiana @ Monroe Insurance Seminar
3601 DeSiard Street
Bossier Council on Aging
706 Bearkat Drive
Bossier City, LA
Annual Health Care Conference
Hilton Capitol Center
201 Lafayette Street
Baton Rouge, LA
7:30 a.m. - 4:00 p.m.
For speaking engagements scheduled after the release of the newsletter or for more detailed information about engagements listed in the newsletter, visit our website at www.ldi.la.gov. Click on the Events tab, found in the center of the home page.
To view previous newsletters, click on Consumer Advocacy under Consumers, then click on Consumer Advocacy Newsletters.
To find out if Consumer Advocacy will be in your area or to request a speaker for your organization or group, call (225) 219-0619 or send an email to
If you no longer wish to receive this newsletter please send an email to the following address with "REMOVE" in the subject line.
Follow the Louisiana Department of Insurance on
Usage Based Insurance
In an effort to tighten our budget, we decrease our spending in every area possible. Studies have shown that the cost of insurance is one of the first items in the budget consumers reduce. We seek additional discounts by “bundling” or having multiple policies with one company. We cancel coverages that are optional, decrease coverage amounts and even cancel policies. With gasoline prices on the rise, consumers are opting to drive less or carpool to save money, too.
Consider saving money on car insurance based on how much, when and where you drive. This is the concept of usage based insurance, commonly referred to as pay as you drive (PAYD).
There are several common types of usage based insurance:
- Coverage is based on the actual mileage or the odometer reading of the vehicle;
- Coverage is based on the actual amount of time the vehicle is used as recorded by a device installed in the vehicle by the insurer;
- Coverage is based on data collected from the vehicle, such as an individual’s driving speed, braking habits, geographic location of the vehicle and the time of day the vehicle is driven in certain areas.
In Louisiana, one company has approved rates and rules for a pay-as-you drive program. In February, drivers in California were introduced to new insurance programs by two nationwide insurance companies, which offered discounts for driving fewer miles. The concept is simple: the less you drive, the less you pay. That's the idea behind pay-as-you-drive programs. Instead of paying a flat premium each month, drivers are allowed to pay based on usage. Companies estimated consumers could save from 5 percent to 40 percent on their automobile insurance premium depending on how the consumers drive. Individuals who work from home or who are currently unemployed or anyone who drives fewer than 19,000 miles per year could potentially save money.
Usage based insurance coverage gives consumers several options:
- self-report their odometer readings at the beginning and end of each policy period;
- allow the company to access their mileage automatically by installing a monitoring system in their car;
- equip vehicles with On-Star to automatically update information for the insurer.
Usage based insurance has been criticized primarily because consumers who choose the self-reporting option must agree to random inspections of vehicles to verify that the vehicle mileage actually matches what was reported. Also, consumers do not know what amount, if any, they would save prior to starting the program because the data has to be analyzed to determine how much each consumers pays. In addition, some systems utilize GPS tracking of vehicles which some feel infringes upon an individual’s right to privacy. Finally, if a consumers do not plan properly and drive more than usual, they could end up paying a lot more than they expected to pay. Many people would probably agree that driving less will save money on gasoline and insurance costs; however, there are other factors consumers should consider.
There are financial incentives for driving less, such as saving on vehicle maintenance and gasoline expenses. The effect that driving fewer miles has on reducing the amount of traffic on the highway and leading to less air pollution can certainly be appreciated. It is important to thoroughly research companies and products before making a decision to switch to usage based insurance. The Louisiana Department of Insurance can provide information to assist you in securing insurance at an affordable rate.
Automobile Medical Payments Insurance Coverage
Automobile medical payments insurance, commonly called “MedPay”, is a liability coverage that pays medical expenses without regard to fault. Medical payments insurance is traditionally sold in increments of $1,000 or $5,000, and typically costs an average of $20 per year for $1,000 in coverage.
Medical payments insurance provides for eligible medical expenses (and sometimes funeral expenses) resulting from an accident for you and passengers riding in your car, regardless of fault. Medical payments insurance may also be applied to doctor visits, x-rays, surgery, emergency medical technician services, ambulance fees, dental treatment, hospitalization, professional nursing services, and prostheses.
If you or a family member are hurt in someone else’s car, your medical payments insurance may pay if the car owner doesn't have any medical payments insurance or if medical expenses are over and above the other car owner’s insurance. The insurance may also cover policyholders and their family members when they're injured if a car hits them while on foot or bicycling. To claim benefits under medical payments insurance, the policyholder must file a claim to get reimbursed for any eligible expenses. Generally, the cost of treatment is paid at the time of service and the insurance company reimburses the policyholder.
As with most insurance policies, there are exclusions to coverage:
- If you are using the car as a taxi, no one will be covered;
- If the injuries are sustained during the course of employment, if benefits are payable or must be provided under a workers’ compensation law or similar law;
- If you own the vehicle and did not buy med pay coverage on that vehicle, you will not be covered;
- If the injury is caused by war, rebellion, etc. there is no coverage.
Expenses incurred for medical treatment due to an automobile accident can often be quite costly and is never expected. Ask your insurance producer about medical payment insurance and decide if it’s right for you.
Shopping for Automobile Insurance
There are many things to consider when shopping for automobile insurance. This newsletter discussed two facets of automobile insurance that often get overlooked - medical payments liability coverage and the usage based insurance method of premium calculation.
A helpful tool the Louisiana Department of Insurance provides for consumers is the auto rate comparison guide. This guide presents premium quotes from some of the top carriers of automobile insurance in our state. The quotes reflect various rating situations such as driver and vehicle age, location and driving record. Although the examples may not precisely reflect your specific situation, they give you a good idea of what premiums can be expected.
If you are shopping for automobile insurance and looking for quality coverage, while keeping costs down, this newsletter, along with the comparison guide should provide you with a good roadmap and evoke practical questions to ask your insurance professional. Access the auto rate guide online, find the rating situation that most closely relates to your risk and start shopping!
To access the auto rate guide click here or visit www.ldi.la.gov, click on Media located at the top of the home page, then click on Consumer Publications. Once you have accessed the guides and compared the various companies, you can continue your search by clicking on each individual company listed to access the company Web site. The Department can provide information on the national rating of each insurer and the number of complaints, if any, that have been filed against a company. If you would like further guidance, contact the Department of Insurance at 1-800-259-5300.
Clarissa A. Preston, CIC, APIR
Health Care Conference April 26 in Baton Rouge
Who: Louisiana Department of Insurance
What: 2011 Annual Health Care Conference
When: April 26, 2011, 8:30 a.m. – 4 p.m.
Where: Hilton Baton Rouge Capitol Center
201 Lafayette Street
Baton Rouge, LA
How: Visit www.ldi.la.gov, and click on 2011 Health Care Conference on
the home page newsreel.
Health care reform continues to be a leading national headline and a topic of great interest and controversy across the entire country. At this year’s conference, state and national health care experts will discuss the future impact of state health care reform and the enacted federal health care reform measures.