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| SGI 2007 Motorcycle Insurance Rate Proposal Details |
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| Friday, 02 March 2007 | |
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The Auto Fund is moving to a new rating structure for motorcycles. At present, motorcycles are rated based on engine size and model year. This type of rating has created inequities within the motorcycle group itself because recent claim statistics show a correlation between "style" of motorcycle and loss experience. In particular, sport motorcycles are more frequently involved in collisions and incur higher claim costs. As such, the recommendation includes changing the rate criteria for motorcycles to include "style" as a rating factor. When rates were adjusted in the past, changes were applied to all motorcycles irrespective of the style driven (i.e., Sport, Cruiser/Touring and Dual Purpose/Other). In other words, adjustments were applied across the board to this rate group. The recommendation is that when rates are adjusted for the motorcycle rate group in the future, the extent of the adjustment will differ based on the loss experience of that particular style of motorcycle. This will enhance fairness in rating for motorcycles, as rates will no longer be adjusted across the board for this rate group. Styles of motorcycles are: Sport: A motorcycle that has a streamlined styling, including factory-installed streamlined windshield and fairing. The rider position is forward leaning with upper body and arms directly over the front wheel steering radius. Cruiser: Retro-style motorcycles with a long chopper look and chrome. Touring: A motorcycle with factory installed luggage, weather protective windshield and fairing. The rider position is generally upright. Dual Purpose and Other: Conventional type of motorcycle design and factory equipped for both pavement and off-road use. These motorcycles include factory-installed high fenders and tires suitable for dual-purpose use and meeting street-safety requirements such as mirrors and turn signal indicators. An overall rate indication was completed for motorcycles, which indicated that rates needed to increase by 96% in order for premiums collected to cover claim costs and other expenses. The following is a break-down of the loss experience for each style of motorcycle:
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| Last Updated ( Monday, 07 January 2008 ) |
