AUTO INSURANCE PREMIUMS IN CALIFORNIA:

Transcription

1 CASUALTY ACTUARIAL SOCIETY SEMINAR ON RATEMAKING Atlanta, Georgia March 9, 2007 AUTO INSURANCE PREMIUMS IN CALIFORNIA: GIVING GREATER WEIGHT TO HOW WELL YOU DRIVE THAN TO YOUR ZIP CODE AND OTHER OPTIONAL FACTORS Mark Savage Senior Attorney Consumers Union of United States, Inc. Counsel for Petitioners Consumers Union of United States, Inc. National Council of La Raza Southern Christian Leadership Conference of Greater Los Angeles Spanish Speaking Citizens' Foundation Foundation for Taxpayer and Consumer Rights City of Los Angeles City of Oakland City and County of San Francisco West Coast Office 1535 Mission Street San Francisco, California Tel Fax

2 Proposition 103 Enacted November 8, 1988, by the Voters of California [Section] (a). Rates and premiums for an automobile insurance policy, as described in subdivision (a) of Section 660, shall be determined by application of the following factors in decreasing order of importance: (1) The insured's driving safety record. (2) The number of miles he or she drives annually. (3) The number of years of driving experience the insured has had. (4) Such other factors as the commissioner may adopt by regulation that have a substantial relationship to the risk of loss. The regulations shall set forth the respective weight to be given each factor in determining automobile rates and premiums. Notwithstanding any other provision of law, the use of any criterion without such approval shall constitute unfair discrimination. Page 2

3 Insurers Give Greater Weight to Where You Live, and Your Gender and Marital Status, Than to How Well You Drive Rating Factors Used by One of California's Largest Automobile Insurers Bodily Injury/Property Damage Coverage, 2004 Class Plan Gender, Marital Status Cost/Frequency ZIP Code Bands Auto Rating Factor DRIVING SAFETY RECORD (mandatory) ANNUAL MILEAGE (mandatory) YEARS OF DRIVING EXPERIENCE (mandatory) Multiple Line Multi/Single Car Average of Optional Factors' Weights Persistency Academic Standing Usage of Vehicle Driving Safety Education Percentage Use by Driver Mature Driver Improvement 2nd Driver Characteristics Weight 11/9/2006 Page 3 State Farm Mutual Automobile Insurance Co., 2004 Class Plan File No CP, Exhibit 6

4 Insurers Give Greater Weight to Where You Live, and Your Marital Status, Than to How Well You Drive Rating Factors Used by One of California's Largest Automobile Insurers Bodily Injury/Property Damage Coverage, 2002 Class Plan Auto Rating Factor Severity ZIP Code Bands DRIVING SAFETY RECORD (mandatory) Frequency ZIP Code Bands Multi-Line Marital Status ANNUAL MILEAGE (mandatory) YEARS OF DRIVING EXPERIENCE (mandatory) Average of Optional Factors' Weights Multicar Training Good Student Type of Use Vehicle Characteristics Persistency Gender Percent Use Vehicle Performance Secondary Driver Characteristics Type of Vehicle Weight 11/8/2006 Page 4 Farmers Insurance Exchange, 2002 Class Plan No CP, Exhibit 6

5 Insurers Give Greater Weight to Where You Live, and Your Gender, Than to How Well You Drive Rating Factors Used by One of California's Largest Automobile Insurers Bodily Injury Coverage, 2002 Class Plan Auto Rating Factor Frequency ZIP Code Bands DRIVING SAFETY RECORD (mandatory) Gender ANNUAL MILEAGE (mandatory) Multi-vehicle YEARS OF DRIVING EXPERIENCE (mandatory) Severity ZIP Code Bands Multiple Policy Discount Average of Optional Factors' Weights Persistency Type of Use Type of Vehicle Marital Status Percent Use Academic Standing Vehicle Characteristics Driver Training Weight 11/9/2006 Page 5 Allstate Insurance Company 2002 Class Plan No CP, Exhibit 6

6 $891 or 87% Increase for Same Good Driver, Same Coverage ZIP Codes in San Francisco Bay Area Female Good Driver, Licensed 22 Years, No Accidents/Violations, Standard Coverage $2,200 $2, Oakland ALAMEDA, $1, $1,800 $1,600 $1,400 $1, Piedmont ALAMEDA, $1, Fremont ALAMEDA, $1, Pleasanton ALAMEDA, $1, Oakland ALAMEDA, $1, Richmond CONTRA COSTA, $1, San Ramon CONTRA COSTA, $1, San Francisco SAN FRANCISCO, $1, San Francisco SAN FRANCISCO, $1, South San Francisco SAN MATEO, $1, San Jose SANTA CLARA, $1, $1, Palo Alto SANTA CLARA, $1, $ Alameda ALAMEDA Fremont ALAMEDA Livermore ALAMEDA Pleasanton ALAMEDA Oakland ALAMEDA Oakland ALAMEDA Oakland ALAMEDA Oakland ALAMEDA Oakland ALAMEDA Oakland ALAMEDA Oakland ALAMEDA Oakland ALAMEDA Oakland ALAMEDA Piedmont ALAMEDA Oakland ALAMEDA Oakland ALAMEDA Oakland ALAMEDA Oakland ALAMEDA Berkeley ALAMEDA Kensington ALAMEDA North Berkeley ALAMEDA Danville CONTRA COSTA Antioch CONTRA COSTA Brentwood CONTRA COSTA Concord CONTRA COSTA Lafayette CONTRA COSTA Martinez CONTRA COSTA Moraga CONTRA COSTA Orinda CONTRA COSTA San Ramon CONTRA COSTA Walnut Creek CONTRA COSTA Walnut Creek CONTRA COSTA Richmond CONTRA COSTA San Rafael MARIN Fairfax MARIN Novato MARIN Tomales MARIN San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO San Francisco SAN FRANCISCO Half Moon Bay SAN MATEO La Honda SAN MATEO Redwood City SAN MATEO South San Francisco SAN MATEO East Palo Alto SAN MATEO San Mateo SAN MATEO Sunnyvale SANTA CLARA Palo Alto SANTA CLARA Stanford SANTA CLARA Cupertino SANTA CLARA Gilroy SANTA CLARA Los Gatos SANTA CLARA Morgan Hill SANTA CLARA Saratoga SANTA CLARA San Jose SANTA CLARA Annual Premium ZIP Code 11/9/2006 Page 6 State Farm Mutual Automobile Insurance Co Class Plan No CP

7 $1,249 or 94% Increase for Same Good Driver, Same Coverage ZIP Codes in Los Angeles Region Female Good Driver, Licensed 22 Years, No Accidents/Violations, Standard Coverage $2,700 $2,500 $2, Los Angeles (Baldwin Hills), $2, Inglewood, $2, Van Nuys, $2, $2,100 $1, Pacific Palisades, $1, $1,700 $1,500 $1, Los Angeles (Westchester), $1, Palos Verdes, $1, Pasadena, $1, Valencia, $1, Glendora, $1, $1, Los Angeles Los Angeles (Echo Park) Hollywood Los Angeles Los Angeles Los Angeles (View Park) Los Angeles Los Angeles (Westchester) Los Angeles Los Angeles Los Angeles (Baldwin Hills) Los Angeles Century City Los Angeles West Hollywood Beverly Hills Beverly Hills Beverly Hills Compton Culver City Downey Gardena Gardena Lawndale Pacific Palisades Palos Verdes South Gate Inglewood Torrance Torrance Whittier Norwalk Harbor City Lomita Carson South Pasadena Sunland Pasadena Calabasas Canoga Park Van Nuys Northridge Pacoima Reseda Mission Hills Valencia Tarzana Woodland Hills Van Nuys Panorama City Sherman Oaks Van Nuys Van Nuys Van Nuys Sherman Oaks Encino Burbank North Hollywood Studio City North Hollywood Universal City Glendora La Puente Rowland Heights Monterey Park Diamond Bar Pomona Alhambra Palmdale ZIP Code 11/10/2006 Page 7 Farmers Insurance Exchange 2002 Class Plan No CP Annual Premium

8 $340 or 36% Increase for Same Good Driver, Same Coverage ZIP Codes in San Diego Region Female Good Driver, Licensed 22 Years, No Accidents/Violations, Standard Coverage $1,300 $1, San Diego, $1, $1, National City, $1, $1,150 $1,100 $1, La Jolla, $1, $1, Coronado, $ $ Alpine, $ Poway, $ $ Alpine Chula Vista Chula Vista National City El Cajon Escondido Fallbrook La Jolla Oceanside Oceanside Oceanside Poway Ramona San Marcos Vista San Diego San Diego San Diego Barrio Logan City San Diego Coronado San Diego South San Diego San Ysidro San Diego ZIP Code 11/10/2006 Page 8 Allstate Insurance Company 2002 Class Plan No CP Annual Premium

9 $308 or 28% Increase for Same Good Driver, Same Coverage ZIP Codes across Northern California Female Good Driver, Licensed 22 Years, No Accidents/Violations, Standard Coverage $1,450 $1,400 $1,350 $1,300 $1,250 $1,200 $1, Colusa COLUSA, $1, Durham BUTTE, $1, Chico BUTTE, $1, Williams COLUSA, $1, Olivehurst YUBA, $1, Arcata HUMBOLDT, $1, Eureka HUMBOLDT, $1, Gualala MENDOCINO, $1, Somes Bar SISKIYOU, $1, Ukiah MENDOCINO, $1, Anderson SHASTA, $1, Castella SHASTA, $1, $1, Yreka SISKIYOU, $1, $1,050 $1, Biggs BUTTE Chico BUTTE Chico BUTTE Durham BUTTE Gridley BUTTE Magalia BUTTE Thermalito BUTTE Oroville BUTTE Palermo BUTTE Paradise BUTTE Stirling City BUTTE Colusa COLUSA Grimes COLUSA Maxwell COLUSA Princeton COLUSA Lodoga COLUSA Williams COLUSA Greenville PLUMAS Quincy PLUMAS Chester PLUMAS Cromberg PLUMAS Chilcoot PLUMAS Portola PLUMAS Live Oak SUTTER Meridian SUTTER Sutter SUTTER Yuba City SUTTER Browns Valley YUBA Challenge YUBA Dobbins YUBA Olivehurst YUBA Crescent City DEL Gasquet DEL NORTE Klamath DEL NORTE Smith River DEL NORTE Eureka HUMBOLDT Arcata HUMBOLDT Bridgeville HUMBOLDT Ferndale HUMBOLDT Garberville HUMBOLDT Hoopa HUMBOLDT Miranda HUMBOLDT Orick HUMBOLDT Orleans HUMBOLDT Redway HUMBOLDT Scotia HUMBOLDT Willow Creek HUMBOLDT Boonville MENDOCINO Fort Bragg MENDOCINO Gualala MENDOCINO Hopland MENDOCINO Mendocino MENDOCINO Ukiah MENDOCINO Leggett MENDOCINO Butte City GLENN Elk Creek GLENN Orland GLENN Willows GLENN Clearlake LAKE Kelseyville LAKE Lakeport LAKE Lucerne LAKE Middletown LAKE Somes Bar SISKIYOU Callahan SISKIYOU Dorris SISKIYOU Etna SISKIYOU Grenada SISKIYOU Happy Camp SISKIYOU Macdoel SISKIYOU Yreka SISKIYOU Tulelake SISKIYOU Big Bar TRINITY Hayfork TRINITY Lewiston TRINITY Weaverville TRINITY Canby MODOC Alturas MODOC Cedarville MODOC Davis Creek MODOC Redding SHASTA Anderson SHASTA Burney SHASTA Castella SHASTA Cottonwood SHASTA Herlong LASSEN Ravendale LASSEN Susanville LASSEN Termo LASSEN Westwood LASSEN Flournoy TEHAMA Los Molinos TEHAMA Mineral TEHAMA Red Bluff TEHAMA Annual Premium ZIP Code 11/10/2006 Page 9 State Farm Mutual Automobile Insurance Co., 2002 Class Plan No CP

10 $730 or 89% Increase for Same Good Driver, Same Coverage ZIP Codes in Central Valley Region Female Good Driver, Licensed 22 Years, No Accidents/Violations, Standard Coverage $1, Rolinda (Fresno) FRESNO, $1, $1, Fresno FRESNO, $1, La Grange STANISLAUS, $1, $1,200 $1,000 $ Buttonwillow KERN, $1, Bakersfield KERN, $ Keene KERN, $ Visalia TULARE, $1, Coulterville MARIPOSA, $ $ Coalinga FRESNO Huron FRESNO Laton FRESNO Big Creek FRESNO Clovis FRESNO Clovis FRESNO Kerman FRESNO Kingsburg FRESNO Lanare FRESNO Sanger FRESNO San Joaquin FRESNO Rolinda (Fresno) FRESNO Fresno FRESNO Fresno FRESNO Fresno FRESNO Fresno FRESNO Arvin KERN Buttonwillow KERN Delano KERN Glennville KERN Kernville KERN Lamont KERN Lebec KERN Lost Hills KERN McFarland KERN Shafter KERN Wasco KERN Bakersfield KERN Bakersfield KERN Bakersfield KERN Greenacres KERN Mojave KERN Keene KERN Ridgecrest KERN Bear Valley Springs KERN Avenal KINGS Corcoran KINGS Hanford KINGS Kettleman City KINGS Lemoore KINGS Stratford KINGS Ahwahnee MADERA Chowchilla MADERA Madera MADERA Oakhurst MADERA Alpaugh TULARE Ducor TULARE Earlimart TULARE Goshen TULARE Pixley TULARE Porterville TULARE Richgrove TULARE Springville TULARE Terra Bella TULARE Tipton TULARE Woodville TULARE Visalia TULARE Dinuba TULARE Traver TULARE Bradley MONTEREY Salinas MONTEREY Big Sur MONTEREY Carmel MONTEREY Greenfield MONTEREY Monterey MONTEREY Soledad MONTEREY Hollister SAN BENITO Paicines SAN BENITO San Juan Bautista SAN BENITO Catheys Valley MARIPOSA Coulterville MARIPOSA Mariposa MARIPOSA Yosemite Valley MARIPOSA La Grange STANISLAUS Modesto STANISLAUS Oakdale STANISLAUS Patterson STANISLAUS Turlock STANISLAUS Los Banos MERCED Gustine MERCED Merced MERCED Planada MERCED Annual Premium ZIP Code 11/10/2006 Page 10 Allstate Insurance Company 2002 Class Plan No CP

11 $292 or 68% Increase for Same Good Driver, Same Coverage ZIP Codes in San Francisco Bay Area BI/PD Liability Coverage Only Female Good Driver, Licensed 22 Years, No Accidents/Violations $750 $ Oakland, $ Berkeley, $ San Francisco [Hunters Point], $ $650 $600 $550 $ San Francisco, $ San Francisco, $ Oakland (Piedmont), $ Kensington, $ $ Pleasanton, $ Lafayette, $ $ Alameda Fremont Livermore Pleasanton Oakland Oakland Oakland Oakland Oakland Oakland Oakland Oakland Oakland Oakland (Piedmont) Oakland Oakland Oakland Oakland Berkeley Kensington North Berkeley Danville Antioch Brentwood Concord Lafayette Martinez Moraga Orinda San Ramon Walnut Creek Walnut Creek Richmond San Rafael Fairfax Novato Tomales San Francisco San Francisco San Francisco San Francisco San Francisco San Francisco San Francisco San Francisco San Francisco San Francisco San Francisco San Francisco San Francisco San Francisco San Francisco San Francisco San Francisco San Francisco San Francisco [Hunters Point] San Francisco San Francisco San Francisco San Francisco San Francisco San Francisco San Francisco Annual Premium ZIP Code 11/9/2006 Page 11 Farmers Insurance Exchange 2002 Class Plan No CP

12 $299 or 99% Increase for Same Good Driver, Same Coverage ZIP Codes in Central Valley Region BI/PD Liability Coverage Only Female Good Driver, Licensed 22 Years, No Accidents/Violations $ Fresno FRESNO, $ $550 $450 $ Bakersfield KERN, $ Goshen TULARE, $ Catheys Valley MARIPOSA, $ Markleeville ALPINE, $ Ridgecrest KERN, $ $ Big Creek FRESNO Clovis FRESNO Clovis FRESNO Kerman FRESNO Kingsburg FRESNO Lanare FRESNO Sanger FRESNO San Joaquin FRESNO Rolinda (Fresno) FRESNO Fresno FRESNO Fresno FRESNO Fresno FRESNO Fresno FRESNO Buttonwillow KERN Delano KERN Glennville KERN Kernville KERN Lamont KERN Lebec KERN Lost Hills KERN McFarland KERN Shafter KERN Wasco KERN Bakersfield KERN Bakersfield KERN Bakersfield KERN Greenacres KERN Mojave KERN Keene KERN Ridgecrest KERN Bear Valley Springs KERN Avenal KINGS Corcoran KINGS Hanford KINGS Kettleman City KINGS Lemoore KINGS Stratford KINGS Ahwahnee MADERA Chowchilla MADERA Madera MADERA Oakhurst MADERA Alpaugh TULARE Ducor TULARE Earlimart TULARE Goshen TULARE Pixley TULARE Porterville TULARE Richgrove TULARE Springville TULARE Terra Bella TULARE Tipton TULARE Woodville TULARE Visalia TULARE Dinuba TULARE Traver TULARE Bradley MONTEREY Salinas MONTEREY Big Sur MONTEREY Carmel MONTEREY Greenfield MONTEREY Monterey MONTEREY Soledad MONTEREY Hollister SAN BENITO Paicines SAN BENITO San Juan Bautista SAN BENITO Catheys Valley MARIPOSA Coulterville MARIPOSA Mariposa MARIPOSA Yosemite Valley MARIPOSA Markleeville ALPINE La Grange STANISLAUS Modesto STANISLAUS Oakdale STANISLAUS Patterson STANISLAUS Turlock STANISLAUS Los Banos MERCED Gustine MERCED Merced MERCED Planada MERCED Annual Premium ZIP Code 11/9/2006 Page 12 Farmers Insurance Exchange 2002 Class Plan No CP

13 Insurers Charge the Same Good Driver in Rural Towns More than in "Urban" and "Suburban" Cities When Insurers Can Manipulate Your Premium Based Primarily on Where You Live, Not How You Drive, Good Drivers in Small Rural Towns Can Pay More $1,000 $1,100 $1,200 $1,300 $1,400 $1,500 $1,600 $1,700 $1, Chinese Camp TUOLUMNE (pop. 146) Raisin City FRESNO (pop. 165) Amador City AMADOR (pop. 196) Lemon Cove TULARE (pop. 298) Hickman STANISLAUS (pop. 457) Mokelumne Hill CALAVERAS (pop. 774) Oakhurst MADERA (pop. 2868) Sutter SUTTER (pop. 2885) Lockeford SAN JOAQUIN (pop. 3179) Terra Bella TULARE (pop. 3466) $1, $1, $1, $1, $1, $1, $1, $1, $1, $1, Carmel By The Sea MONTEREY (pop. 4081) Red Bluff TEHAMA (pop ) $1, $1, Manhattan Beach LOS ANGELES (pop ) $1, San Luis Obispo SAN LUIS OBISPO (pop ) $1, San Ramon CONTRA COSTA (pop ) San Clemente ORANGE (pop ) Palo Alto SANTA CLARA (pop ) $1, $1, $1, Chico BUTTE (pop ) Davis YOLO (pop ) Walnut Creek CONTRA COSTA (pop ) Newport Beach ORANGE (pop ) $1, $1, $1, $1, Mountain View SANTA CLARA (pop ) $1, Redding SHASTA (pop ) $1, Santa Barbara SANTA BARBARA (pop ) $1, San Mateo SAN MATEO (pop ) Thousand Oaks VENTURA (pop ) Concord CONTRA COSTA (pop ) Torrance LOS ANGELES (pop ) Fremont ALAMEDA (pop ) Bakersfield KERN (pop ) Riverside RIVERSIDE (pop ) Long Beach LOS ANGELES (pop ) San Jose SANTA CLARA (pop ) San Diego SAN DIEGO (pop ) $1, $1, $1, $1, $1, $1, $1, $1, $1, $1, /9/2006 Page 13 State Farm Mutual Automobile Insurance Co Class Plan No CP

14 Population Thous #### Terra 3466 Median Family Income Thousa#### Terra B#### Good Driver insurance Premium Thous #### Terra B#### Small Town Pays More Than Much Bigger City ZIP-Code Based Auto Rates Hurt Rural Communities, Too Population Terra Bella (Tulare Co.) 3,466 Thousand Oaks (Ventura Co.) 117, ,000 40,000 60,000 80, , , ,000 Median Family Income Terra Bella $24,750 Thousand Oaks $86,041 $0 $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000 $90,000 $100,000 Good Driver Insurance Premium Terra Bella $1,448 Thousand Oaks $1,213 $1,100 $1,200 $1,300 $1,400 $1,500 Premium for female good driver, licensed 22 years, no accidents/violations, standard coverage Page 14 State Farm Mutual Automobile Insurance Co., 2002 Class Plan No CP

15 0 mi Copyright Microsoft Corp. and/or its suppliers. All rights reserved. Copyright 2002 by Geographic Data Technology, Inc. All rights reserved Navigation Technologies. All rights reserved. This data includes information taken with permission from Canadian authorities Government of Canada (Statistics Canada and/or Geomatics Canada), all rights reserved.

16 0 mi Copyright Microsoft Corp. and/or its suppliers. All rights reserved. Copyright 2002 by Geographic Data Technology, Inc. All rights reserved Navigation Technologies. All rights reserved. This data includes information taken with permission from Canadian authorities Government of Canada (Statistics Canada and/or Geomatics Canada), all rights reserved.

17 $614 or 53% Increase for Rural Good Drivers when Insurers Base Premiums Primarily on ZIP Code, Not Driving Record 100% Rural ZIP Codes per Census 2000 Female Good Driver, Licensed 22 Years, No Accidents/Violations, Standard Coverage $1,800 $1, Raisin City FRESNO (pop. 165), $1, Morongo Valley SAN BERNARDINO (pop. 1929), $1, $1,600 $1,500 $1,400 $1,300 $1,200 $1, Wallace CALAVERAS (pop. 220), $1, Greenview SISKIYOU (pop. 200), $1, Independence INYO (pop. 574), $1, Tulelake SISKIYOU (pop. 1020), $1, Buttonwillow KERN (pop. 1266), $1, Boron KERN (pop. 2025), $1, $1, Canyon Dam PLUMAS (pop. 37) Randsburg KERN (pop. 77) Montgomery Creek SHASTA (pop. 96) Birds Landing SOLANO (pop. 130) Mineral TEHAMA (pop. 143) McKittrick KERN (pop. 160) Markleeville ALPINE (pop. 197) Tomales MARIN (pop. 210) Port Costa CONTRA COSTA (pop. 232) Farmington SAN JOAQUIN (pop. 262) Ocotillo IMPERIAL (pop. 296) Dillon Beach MARIN (pop. 319) Manton TEHAMA (pop. 372) San Geronimo MARIN (pop. 436) Onyx KERN (pop. 476) Friant FRESNO (pop. 519) Leggett MENDOCINO (pop. 592) Cantua Creek FRESNO (pop. 655) Shaver Lake FRESNO (pop. 705) Stinson Beach MARIN (pop. 751) Tranquility FRESNO (pop. 813) Gasquet DEL NORTE (pop. 851) Salton City IMPERIAL (pop. 978) Tulelake SISKIYOU (pop. 1020) Springville TULARE (pop. 1109) Greenville PLUMAS (pop. 1160) Hydesville HUMBOLDT (pop. 1209) Stratford KINGS (pop. 1264) Lewiston TRINITY (pop. 1305) Mariposa MARIPOSA (pop. 1373) Bodega Bay SONOMA (pop. 1423) Colfax PLACER (pop. 1496) Mountain Ranch CALAVERAS (pop. 1557) Lone Pine INYO (pop. 1655) Tipton TULARE (pop. 1790) Hopland MENDOCINO (pop. 1839) Gualala MENDOCINO (pop. 1916) Westwood LASSEN (pop. 1998) Murphys CALAVERAS (pop. 2061) Cabazon RIVERSIDE (pop. 2229) Hayfork TRINITY (pop. 2315) Weldon KERN (pop. 2387) San Andreas CALAVERAS (pop. 2615) Angwin NAPA (pop. 3148) Weaverville TRINITY (pop. 3554) Valley Center SAN DIEGO (pop. 7323) Annual Premium Rural ZIP Code 11/10/2006 Page 15 State Farm Mutual Automobile Insurance Co Class Plan No CP

18 $355 or 88% Increase for Rural Good Drivers when Insurers Base Premiums Primarily on ZIP Code, Not Driving Record 100% Rural ZIP Codes per Census 2000 BI/PD Liability Coverage Only Female Good Driver, Licensed 22 Years, No Accidents/Violations $800 $750 $700 $650 $600 $550 $500 $450 $400 $350 $ Canyon Dam PLUMAS (pop. 37) Shoshone INYO (pop. 52) Darwin INYO (pop. 54) Keeler INYO (pop. 66) Randsburg KERN (pop. 77) Twain PLUMAS (pop. 87) Clio PLUMAS (pop. 90) Kirkwood ALPINE (pop. 96) Montgomery Creek SHASTA (pop. 96) Tecopa INYO (pop. 99) Bradley MONTEREY (pop. 120) Round Mountain SHASTA (pop. 122) Birds Landing SOLANO (pop. 130) Olancha INYO (pop. 134) Gazelle SISKIYOU (pop. 136) Macdoel SISKIYOU (pop. 140) Mineral TEHAMA (pop. 143) Big Bend SHASTA (pop. 149) Fellows KERN (pop. 153) Taylorsville PLUMAS (pop. 154) McKittrick KERN (pop. 160) Raisin City FRESNO (pop. 165) Johannesburg KERN (pop. 176) Amador City AMADOR (pop. 196) Markleeville ALPINE (pop. 197) Orick HUMBOLDT (pop. 200) Greenview SISKIYOU (pop. 200) Big Bar TRINITY (pop. 207) Tomales MARIN (pop. 210) Wallace CALAVERAS (pop. 220) Tupman KERN (pop. 227) Glennville KERN (pop. 230) Port Costa CONTRA COSTA (pop. 232) Palo Verde IMPERIAL (pop. 236) French Gulch SHASTA (pop. 254) Crescent Mills PLUMAS (pop. 258) Farmington SAN JOAQUIN (pop. 262) Yosemite Valley MARIPOSA (pop. 265) Hornbrook SISKIYOU (pop. 286) Cromberg PLUMAS (pop. 290) Ocotillo IMPERIAL (pop. 296) Lemon Cove TULARE (pop. 298) Moss Landing MONTEREY (pop. 300) Trinidad HUMBOLDT (pop. 311) Dillon Beach MARIN (pop. 319) Grenada SISKIYOU (pop. 351) McArthur SHASTA (pop. 365) March AFB RIVERSIDE (pop. 370) Manton TEHAMA (pop. 372) Chilcoot PLUMAS (pop. 387) San Lucas MONTEREY (pop. 419) Vallecito CALAVERAS (pop. 427) San Geronimo MARIN (pop. 436) Orleans HUMBOLDT (pop. 449) Hickman STANISLAUS (pop. 457) Point Arena MENDOCINO (pop. 474) Onyx KERN (pop. 476) Spreckels MONTEREY (pop. 485) San Ardo MONTEREY (pop. 501) Ducor TULARE (pop. 504) Friant FRESNO (pop. 519) Lakehead SHASTA (pop. 549) Independence INYO (pop. 574) Meadow Valley PLUMAS (pop. 575) Leggett MENDOCINO (pop. 592) Millville SHASTA (pop. 610) Fall River Mills SHASTA (pop. 648) Klamath DEL NORTE (pop. 651) Cantua Creek FRESNO (pop. 655) Fort Jones SISKIYOU (pop. 660) Walnut Grove SACRAMENTO (pop. 669) Avery CALAVERAS (pop. 672) Shaver Lake FRESNO (pop. 705) Traver TULARE (pop. 732) West Point CALAVERAS (pop. 746) Westley STANISLAUS (pop. 747) Stinson Beach MARIN (pop. 751) Alpaugh TULARE (pop. 761) Mokelumne Hill CALAVERAS (pop. 774) Etna SISKIYOU (pop. 781) Tranquility FRESNO (pop. 813) Point Reyes Station MARIN (pop. 818) Mendocino MENDOCINO (pop. 824) Isleton SACRAMENTO (pop. 828) Gasquet DEL NORTE (pop. 851) Loyalton SIERRA (pop. 862) Dorris SISKIYOU (pop. 886) Georgetown EL DORADO (pop. 962) Salton City IMPERIAL (pop. 978) Plymouth AMADOR (pop. 980) Inyokern KERN (pop. 984) Middletown LAKE (pop. 1020) Tulelake SISKIYOU (pop. 1020) Biola FRESNO (pop. 1037) Challenge YUBA (pop. 1069) Linden SAN JOAQUIN (pop. 1103) Springville TULARE (pop. 1109) Maricopa KERN (pop. 1111) Blue Lake HUMBOLDT (pop. 1135) Niland IMPERIAL (pop. 1143) Greenville PLUMAS (pop. 1160) Covelo MENDOCINO (pop. 1175) Redway HUMBOLDT (pop. 1188) Piru VENTURA (pop. 1196) Hydesville HUMBOLDT (pop. 1209) Laton FRESNO (pop. 1236) Bolinas MARIN (pop. 1246) Palo Cedro SHASTA (pop. 1247) Stratford KINGS (pop. 1264) Buttonwillow KERN (pop. 1266) Occidental SONOMA (pop. 1272) Laytonville MENDOCINO (pop. 1301) Lewiston TRINITY (pop. 1305) McCloud SISKIYOU (pop. 1343) Big Pine INYO (pop. 1350) Los Alamos SANTA BARBARA (pop. 1372) Mariposa MARIPOSA (pop. 1373) Boonville MENDOCINO (pop. 1379) Ferndale HUMBOLDT (pop. 1382) Inverness MARIN (pop. 1421) Bodega Bay SONOMA (pop. 1423) San Miguel SAN LUIS OBISPO (pop. 1427) Chualar MONTEREY (pop. 1444) Montague SISKIYOU (pop. 1456) Colfax PLACER (pop. 1496) Kettleman City KINGS (pop. 1499) Pine Valley SAN DIEGO (pop. 1501) San Juan Bautista SAN BENITO (pop. 1549) Mountain Ranch CALAVERAS (pop. 1557) Julian SAN DIEGO (pop. 1621) Seeley IMPERIAL (pop. 1624) Cobb LAKE (pop. 1638) Lone Pine INYO (pop. 1655) Kernville KERN (pop. 1736) Willow Creek HUMBOLDT (pop. 1743) Olympic Village PLACER (pop. 1761) Tipton TULARE (pop. 1790) Foresthill PLACER (pop. 1791) Biggs BUTTE (pop. 1793) Lagunitas MARIN (pop. 1835) Hopland MENDOCINO (pop. 1839) Esparto YOLO (pop. 1858) Quincy PLUMAS (pop. 1879) Hamilton City GLENN (pop. 1903) Gualala MENDOCINO (pop. 1916) Dunsmuir SISKIYOU (pop. 1923) Morongo Valley SAN BERNARDINO (pop. 1929) Lost Hills KERN (pop. 1938) Westwood LASSEN (pop. 1998) Smith River DEL NORTE (pop. 2018) Boron KERN (pop. 2025) Auberry FRESNO (pop. 2053) Murphys CALAVERAS (pop. 2061) Caruthers FRESNO (pop. 2103) Westmorland IMPERIAL (pop. 2131) Shingletown SHASTA (pop. 2222) Cabazon RIVERSIDE (pop. 2229) Three Rivers TULARE (pop. 2248) Wheatland YUBA (pop. 2275) Wofford Heights KERN (pop. 2276) Hayfork TRINITY (pop. 2315) Chester PLUMAS (pop. 2316) Arbuckle COLUSA (pop. 2332) Frazier Park KERN (pop. 2348) Weldon KERN (pop. 2387) Riverdale FRESNO (pop. 2416) Borrego Springs SAN DIEGO (pop. 2535) Garberville HUMBOLDT (pop. 2593) San Andreas CALAVERAS (pop. 2615) Squaw Valley FRESNO (pop. 2691) Geyserville SONOMA (pop. 2812) Hoopa HUMBOLDT (pop. 3074) Angwin NAPA (pop. 3148) Lockeford SAN JOAQUIN (pop. 3179) Groveland TUOLUMNE (pop. 3388) Idyllwild RIVERSIDE (pop. 3504) Weaverville TRINITY (pop. 3554) Mojave KERN (pop. 3836) Arnold CALAVERAS (pop. 4218) Wilton SACRAMENTO (pop. 4551) Valley Center SAN DIEGO (pop. 7323) Vallejo SOLANO (pop ) Annual Premium Rural ZIP Code 11/9/2006 Page 16 State Farm Mutual Automobile Insurance Co Class Plan CP

19 Widowed Drivers Pay 28% More at GEICO, Because of Marital Status $1,800 $1,600 $1,400 Annual Premium $1,200 $1,000 $800 $600 Married Widowed $400 $200 $0 San Diego Palm Springs Monterey Sacramento Red Bluff Rate quote for standard coverage for 49-year-old male good driver. Page 17 Source: GEICO.com.

20 Good Drivers Pay More than At-Fault Drivers, Because of ZIP Code $1,000 $900 $800 Annual Premium $700 $600 At-Fault Driver Clean Record $500 $400 $300 CUPERTINO v. SAN JOSE Liberty Mutual SAN DIEGO v. DEL MAR Amica RIDGECREST v. BAKERSFIELD Nationwide PALOS VERDES v. SOUTH LOS ANGELES Wawanesa WALNUT CREEK v. OAKLAND Progressive West Page 18 Source: California Department of Insurance, Premium Comparison website,

21 San Francisco Driver with Clean Record Pays More for Basic Liability Insurance Than Marin Driver with At-Fault Accident, Because of ZIP Code $2,100 $1,900 $1,700 $1,500 $1,300 $1,100 Annual Premium $900 $700 $500 $300 AMICA MUTUAL ANCHOR GENERAL CALIFORNIA CAPITAL COAST NATIONAL COMMERCE WEST CSAA CSE SAFEGUARD ENCOMPASS EXPLORER FINANCIAL INDEMNITY FIREMAN'S FUND HARBOR SPECIALTY HAWAIIAN HUDSON LIBERTY MUTUAL LINCOLN GENERAL MERCURY PERMANENT GENERAL PROGRESSIVE QBE REPUBLIC INDEMNITY SAFECO SAFEWAY STERLING CASUALTY TOPA UNIGARD VIKING WAWANESA WESTERN GENERAL WESTERN UNITED San Francisco Good Driver (Sunset District) San Francisco Good Driver (Mission District) San Francisco Good Driver (Nob Hill) San Rafael Driver with At-Fault Accident 11/9/2006 Page 19 Source: California Department of Insurance, Premium Comparison website,

22 REGULATION ' (A) Adopted May 22, 1996 Effective August 4, 1996 ' Factor Weights (a) For each type of coverage, four factor weights shall be evaluated. These four weights are: one weight for each of the three mandatory factors listed in Section (c)(1) through (3) and one for all the optional factor (from Section (d)) weights averaged together. AMENDED REGULATION ' (A) Adopted June 2, 2006 Effective August 13, 2006 Section Factor Weights. (a) For each type of coverage, factor weights shall be calculated for each of the three mandatory factors listed in Section (c)(1) through (3) and for each of the optional factors the insurer elects to utilize in its class plan from Section (d).... Page 20

23 Amended Regulation in Operation Partial Compliance under Transition Plan Rating Factors Used by One of California's Largest Automobile Insurers Bodily Injury/Property Damage Coverage, Class Plan DRIVING SAFETY RECORD (mandatory) Auto Rating Factor Gender, Marital Status Cost/Frequency ZIP Code Bands ANNUAL MILEAGE (mandatory) YEARS OF DRIVING EXPERIENCE (mandatory) Multiple Line Multi/Single Car Persistency Average of Optional Factors' Weights Academic Standing Driving Safety Education Usage of Vehicle Percentage Use by Driver Mature Driver Improvement 2nd Driver Characteristics Weight 11/9/2006 Page 21 State Farm Mutual Automobile Insurance Co Class Plan File No CP, Exhibit 6

24 Amended Regulation in Operation Partial Compliance under Transition Plan Rating Factors Used by One of California's Largest Automobile Insurers Bodily Injury Coverage, Class Plan Claims Frequency ZIP Code Bands Auto Rating Factor DRIVING SAFETY RECORD (mandatory) Claims Severity ZIP Code Bands Multi-Vehicle (Multi-Car) ANNUAL MILES (mandatory) DRIVING EXPERIENCE (mandatory) Average of Optional Factors' Weights Vehicle Type Multi-Policy Gender Vehicle Characteristics Marital Status Academic Standing (Good Student) Persistency Driver Training Weight 11/9/2006 Page 22 Interinsurance Exchange of the Automobile Club 2006 Class Plan File No , Exhibit 6

25 Amended Regulation in Operation Full Compliance under Transition Plan Rating Factors Used by One of California's Largest Automobile Insurers Bodily Injury Coverage, Class Plan DRIVING SAFETY RECORD (mandatory) Claims Frequency ZIP Code Bands ANNUAL MILES (mandatory) Auto Rating Factor DRIVING EXPERIENCE (mandatory) Class/Years Experience Multi Vehicle Driver Use Claims Severity ZIP Code Bands Marital Status Average of Optional Factors' Weights Gender Persistency Multi Policy Academic Standing Driver Training Hybrid Marital Status/Gender Weight 2/26/2007 Page 23 Government Employees Insurance Company (GEICO) 2007 Class Plan No CP, Exhibit 6