Territorial Rating

ANNAPOLIS -- A Senate committee dashed yesterday the hopes of urban drivers looking for relief from high auto insurance rates by killing a package of bills that would prohibit setting prices according to where a driver lives.But the Senate Finance Committee's votes on the so-called "territorial rating" bills, sponsored primarily by senators from Baltimore, mean drivers in less urbanized areas of the state will not see their rates rise as a result.The committee also voted against bills that would:* Abolish the insurance industry's exemption from state antitrust laws.

Legislation that could potentially save motorists hundreds of dollars annually in insurance premiums is sputtering in the General Assembly.Facing vigorous opposition from trial lawyers, doctors and insurance companies, supporters of Gov. Parris N. Glendening's auto insurance reform bill now rate the proposal's chances as iffy -- chiefly because of lukewarm public support.Baltimore drivers long have felt the pinch of insurance rates that can be two or three times higher than those of their suburban and rural counterparts.

Angered by a decision affirming territorial insurance rating, Baltimore City Council President Mary Pat Clarke said her consumer group will mount a court challenge to the decision by Insurance Commissioner John A. Donaho."

Will this be the year of the great auto insurance reform?Don't bet on it. The General Assembly in recent years has repeatedly defeated attempts to abolish "territorial rating" in pricing. Nevertheless, it is both interesting and significant that Gov. Parris N. Glendening chose auto insurance reform as one of his very first initiatives.In a way this is natural. Mr. Glendening's home county, Prince George's, has some of the highest auto insurance rates in Maryland -- after Baltimore City. Since both of those jurisdictions contributed mightily to the governor's slim victory, the least he could do is keep his promise and deal with the auto insurance issue forthwith.

Callers to The Evening Sun's SUNDIAL favor the territorial rating system by which insurance companies can base their rates for auto policies on where a driver lives.Of the 914 callers to SUNDIAL, 61 percent (558 callers) said that territorial rating is fair while 39 percent (356 callers) opposed the system, saying it is unfair.The Maryland insurance commissioner this week ruled that insurance companies can legally use territorial rating. The practice means that city residents usually pay higher premiums than do drivers who live in the suburbs.

A group led by Baltimore City Council President Mary Pat Clarke has lost yet another effort to lower car-insurance rates in the city.Baltimore Fair Auto Insurance Rate Inc. lost an appeal to force Insurance Commission John A. Donaho to hold another hearing on a rate increase for Allstate Insurance Co.Baltimore FAIR's appeal was directed against a 3 percent increase granted to Allstate by the state Insurance Division last May.Last week, Baltimore Circuit Court...

After nearly a year of hearings and study, state Insurance Commissioner John A. Donaho today ruled that territorial rating, the practice that allows insurance companies to base rates on where a driver lives, is legal and has a valid foundation.Territorial rating has been a hot issue because of the disparity in rates among Baltimore and other parts of the state.For instance, State Farm Fire & Casualty Co., the state's largest auto insurer, charges a 20-year-old single man in Baltimore $2,345 annually while the same man pays only $904 per year if he lives on the Eastern Shore, according to a rate guide published by the state.

The governor took no position on Baltimore City car insurance rates during a meeting with City Council President Mary Pat Clarke last night, Clarke said.Clarke is angry at Insurance Commissioner John A. Donaho's decision that territorial rating, the practice that allows insurance companies to base rates on where a driver lives, is legal. Under that system, drivers living in urban areas such as Baltimore pay higher rates than suburban and rural residents.Gov. William Donald Schaefer, who maintains a home in Baltimore, "was very sympathetic.

ANNAPOLIS -- Drivers in Baltimore and other urban areas around Maryland will have to wait for relief from high auto insurance rates because a House committee killed a package of bills yesterday that would have prohibited insurers from charging insurance rates according to where a driver lives.A Senate committee took a similar action last week on bills that would have benefited drivers in high-risk, heavily populated areas such as Baltimore by prohibiting the practice of "territorial rating."

Only 45 percent of the 35,000 vehicles involved in traffic accidents in Baltimore in 1989 were registered in the city, according to a study that will be used to back efforts to limit the impact geography has on automobile insurance rates.And while claims resulting from the accidents are supposed to be listed in the area where a vehicle is registered, the study found no method for verifying that the reassignment actually occurs, said the study's author.Les Ransom, an insurance consultant who wrote the study, also said yesterday that in Maryland, automobile "insurance rates are the highest where the percentage of minority residents is highest."

A Baltimore citizens group is asking the Maryland Human Relations Commission to order one of the state's biggest insurers to stop setting automobile rates based on the territory in which a driver lives because the practice is racially discriminatory.In a complaint filed yesterday against GEICO Corp., the group charges that the insurer's "territorial rate-setting scheme unfairly applies the highest premium rates to predominantly African-American communities," in violation of state anti-discrimination laws.

Only 45 percent of the 35,000 vehicles involved in traffic accidents in Baltimore in 1989 were registered in the city, according to a study that will be used to back efforts to limit the impact geography has on automobile insurance rates.And while claims resulting from the accidents are supposed to be listed in the area where a vehicle is registered, the study found no method for verifying that the reassignment actually occurs, said the study's author.Les Ransom, an insurance consultant who wrote the study, also said yesterday that in Maryland, automobile "insurance rates are the highest where the percentage of minority residents is highest."

A group led by Baltimore City Council President Mary Pat Clarke has lost yet another effort to lower car-insurance rates in the city.Baltimore Fair Auto Insurance Rate Inc. lost an appeal to force Insurance Commission John A. Donaho to hold another hearing on a rate increase for Allstate Insurance Co.Baltimore FAIR's appeal was directed against a 3 percent increase granted to Allstate by the state Insurance Division last May.Last week, Baltimore Circuit Court...

ANNAPOLIS -- Drivers in Baltimore and other urban areas around Maryland will have to wait for relief from high auto insurance rates because a House committee killed a package of bills yesterday that would have prohibited insurers from charging insurance rates according to where a driver lives.A Senate committee took a similar action last week on bills that would have benefited drivers in high-risk, heavily populated areas such as Baltimore by prohibiting the practice of "territorial rating."

Annapolis--Toni Francfort, who lives on East Baltimore Street, is fed up. Her driving record is excellent, same as her husband's; neither has had an accident or a moving violation since the 1950s, said the 65-year-old Butcher's Hill resident, and she drives less than 10,000 miles a year.The punchline? "I pay $1,168 annually [in automobile insurance] for an '87 Dodge Aries, and that does not include collision" coverage, Ms. Francfort said.Only it's no joke, and it's a problem common to thousands of drivers in Baltimore and around the state: painfully high auto insurance rates.

ANNAPOLIS -- A Senate committee dashed yesterday the hopes of urban drivers looking for relief from high auto insurance rates by killing a package of bills that would prohibit setting prices according to where a driver lives.But the Senate Finance Committee's votes on the so-called "territorial rating" bills, sponsored primarily by senators from Baltimore, mean drivers in less urbanized areas of the state will not see their rates rise as a result.The committee also voted against bills that would:* Abolish the insurance industry's exemption from state antitrust laws.

Insurance bias: city driving at suburban ratesI must take issue with the letters submitted by Messrs. Bishop and Kelly ("It depends on where you live", Forum, Dec. 27) defending the territorial-rating system for setting auto insurance rates, which in its current form discriminates against those of us who live in cities such as Baltimore.This rating system, based solely on the location of the owner's residence, fails to take into account the primary use of almost all privately owned cars, which is commuting to work.

The governor took no position on Baltimore City car insurance rates during a meeting with City Council President Mary Pat Clarke last night, Clarke said.Clarke is angry at Insurance Commissioner John A. Donaho's decision that territorial rating, the practice that allows insurance companies to base rates on where a driver lives, is legal. Under that system, drivers living in urban areas such as Baltimore pay higher rates than suburban and rural residents.Gov. William Donald Schaefer, who maintains a home in Baltimore, "was very sympathetic.