Autoblog

Soaked in bad news, GM and Ford received yet another dousing when their three big European credit insurers dropped them this week. Euler Hermes, Atradius, and Coface have all refused to write policies for suppliers trading with both automakers. The three giant insurance companies control more than 80 percent of the world's credit insurance (insurance companies typically pull their coverage when a client stops proving insurers with enough information to calculate a credit risk, or their overall risk profile has deteriorated). Without their credit cover, suppliers will be forced to either trade uninsured, cease trading, or ask for payment up front. Supply issues aside, this news only compounds the automaker's problems as it also weakens investor confidence, already completely slumped.

[Source: FT, free subs. req'd]

If you've taken your car to the track for either an open lapping session or an advanced driver education course, you're undoubtedly aware of the potential risks. While most insurance policies say that the car isn't covered if it's participating in a "timed event," that's all changing now that track time is becoming more common.

A report by The New York Times goes into detail about the loophole and how the big insurers are taking measures to include high-performance driving schools and track days. One interviewee has decided to stop his weekend excursions altogether after learning about the policy changes, and more disturbingly, when another player in the piece asked his insurance company if his Subaru WRX STI was covered during a track event, his policy was dropped six months later.

While the well-to-do are largely immune from the new terms, purchasing dedicated track-day toys or additional insurance, those of us with shallow pockets might have to think twice before we wring our rides out as God intended.

[Source: NYT via TTAC]

While GM is being swamped with the persistent rumors surrounding the addition/dissolution of Chrysler, Ford's rumor mill has been heading in the complete opposite direction. It appears Volvo is on the way out of Dearborn, but Mazda may be sneaking through the exit first. Recent reports since disputed by Mazda have Ford selling off a portion of its 33.4% stake in the Japanese automaker, which means the Blue Oval would lose majority ownership status. The Nikkei daily in Japan has been all over the Ford/Mazda story, and the latest news involves selling 20% of Mazda to 20 Japanese firms including some insurance companies, leaving Ford with a stake of around 13%.

Ford is allegedly unwilling to sell the shares to its competition, so splitting the Mazda shares in 20 small chunks makes picking up all the shares difficult. Besides five insurance companies, parts maker Denso, steel companies, and trading companies are also rumored to be taking part in the purchase. The price of 1% Mazda ownership is in the neighborhood of $40 million, and the total sale could approach $1 billion. Japanese media is reporting that any deal could be announced next month, and neither Mazda or Ford are saying a word at this point.

[Source: Automotive News - Sub. Req.]

We've heard it before: "We're going to collect the information, but it won't go beyond..." The latest take on "Let us help you with technology" comes courtesy of GM's OnStar, which is offering you the opportunity to have your annual mileage tracked. The info will be given to their GMAC arm, which will then see if you qualify for insurance discounts. That sounds good, right?

Of course, no one mentions the other side -- that they can also see if you need a higher premium. "You told us this car was just for weekend recreation, Mr. Smith..." Signing up for the OnStar service is voluntary, so it's not going to start watching you until you say so... yet. But if you really do think you're paying too much, then why not. They probably already know everything about you, anyway... Thanks for the tip, Myles!

[Source: Top Speed]

For drivers between the ages of 16 and 24, the price of insurance can seem more than a little unfair. While $125 per month could insure a luxury vehicle for someone in their 30s, a 16 year-old couldn't get such a rate for a Pinto. There's a very simple reason for this disparity; young motorists are by far the most dangerous drivers on the road. A study by the Rand Corporations shows that while 13-percent of all drivers are between the ages of 16 and 24, 43-percent of all accidents come from that age group. It's a good thing everybody seems to be on the phone while driving, it may not hurt as much when you don't see that pimped out Neon coming.

While young drivers are an accident waiting to happen, those over the age of 65 are much safer than their unearned reputation may suggest. Senior citizens make up 15-percent of all drivers, but only cause 7-percent of the total accidents. Maybe it's because people are a little more careful when they see a Crown Victoria on the road, but that AARP discount appears to be well-deserved anyway. Next time you're on the freeway and you see a Buick Roadmaster in the right lane, get behind it, it's probably one of the safest places on the road.

[Source: Reuters]

Of all the ways an insurance company calculates a driver's premiums, the one factor that's been left out of the equation is real world mileage. Sure, we tell the our insurance provider how many miles we travel, but if its less than the stated minimum, there's no way to prove we've been on the road less. GMAC and OnStar are planning to rectify the matter, post haste.

The plan, which has already been employed on 10,000 drivers in 2004, is to allow subscribers to GM's OnStar system to submit their mileage, and if its less than the 15,000 miles specified in the year-long contract, a discount will be dolled out.

The breakdown will allow drivers who travel between 12,001 and 15,000 miles a year to get a 13-percent reduction, while drivers who clock under 2,500 miles will get a discount of 54-percent.

Of course, this is all assuming that you're driving an OnStar-equipped GM product and your insurance is through GMAC, but with GM's planned push of the OnStar system, it might be just another reason for drivers to head on down to their local dealer.

GM's press release is posted after the jump.

[Source: General Motors]

Britain's installation of more speed cameras and the swap to digital means they'll catch even more speeders. That's good for the treasury. According to British insurer Swinton, it isn't good for the points system that insurance companies use to set premiums -- there are too many people getting more and more points to make it a useful criteria. So Swinton says it will no longer automatically raise premiums if drivers get points due to speed cameras, saying "points alone can no longer be used as a yardstick for driver evaluation." Currently in Britain, getting 12 points means losing your license. With 6,000 cameras nabbing two million speeders annually, and mobile phone infractions earning three points, Swinton says "a few years ago insurers might have assumed that a motorist with six or more points on their license was a reckless driver, but that is no longer necessarily the case." With the suggestion that drivers with 6 points could be viewed as "standard," six could become the new zero. We can't wait for that kind of sense to make it this way. Allstate? You listening?

[Source: Daily Mail]

Here's a post all the domestic-or-nothing crowd should enjoy reading. Of the 10 most expensive cars to insure as listed by Insurelane, only one is American-made, and it's no longer produced. And on the least expensive list, seven are Big Three branded (nine if you count Volvo and Mazda as Fords).

It should come as no surprise that the Mitsubishi Lancer Evo and Subaru WRX aren't cheap to protect, while GMC Safari and Pontiac Montana owners can probably pay their premiums with the half-eaten Cheerios found in their back seats.

As we all know, lots of factors determine your personal rate (age, driving record, number of cars you've totaled right there in your insurance agent's parking lot, etc.), but imports will generally have higher rates over comparable domestics due mostly to more expensive replacement parts.

See the top five on each list after the jump.

[Source: Insurelane]

We've all done dumb things in the car before. Eating, talking on the phone, looking at a map, or even reaching for a dropped CD while driving a car will increase your chances of getting into an accident. The Virginia Tech Transportation Institute teamed up with the AAA Foundation for Traffic Safety to study driver behaviors and determine what we're doing behind the wheel. To capture driver behavior, 240 drivers in and around the Washington DC area drove 100 specially equipped vehicles that contained five cameras that captured the driver's every move. You'd think with big brother you would be a little more aware of what was going on around you. Amazingly, the cameras captured 82 accidents and 761 near-crashes.

At the conclusion of the test, AAA narrowed down the biggest risks as driving while drowsy, speeding, aggressive driving, and taking your eyes off the road for more than two seconds. Speeding and driving drowsy TRIPLED the chances of a resulting accident, and distracted driving and aggressive driving doubled the chance of a crash. AAA's message is clear: if you're late for a meeting, tired, and your tie needs adjusting, catch a cab. You're an accident waiting to happen.

[Source: Business Week]

DaimlerChrysler has finally reached an agreement with its insurers that finally determines who is paying what in a settlement of a lawsuit filed by the automaker's investors over the nature of the merger that created company back in 1998. Chrysler stock holders originally argued that the Daimler-Benz deceived them when describing the joining of both companies as a "merger of equals" and sought an outrageous $22 billion in damages. The lawsuit quotes then DaimlerChrysler head honcho Jürgen Schrempp (shown at right) as saying in a 2000 interview that calling the deal a merger rather than a takovoer was for "psychological reasons" only. That slip of the tonght cost Schrempp and the company as a whole, which was counting on Schrempp's liability insurance to cover most or all of the $300 million settlement that was reached. Many of the company's insurer's, however, refused to pay.

Originally the insurers coughed up $25 million, forcing DCX to pay the rest. Of the remaining $228 million left to be payed on the settlement, the Associated Press is now reporting that insurers insurers have agreed to pay for over $223 million.

[Source: Associated Press via International Herald Tribune]