New Rate Reductions And Features Proposed For Chubb Auto Insurance In Nevada

Three Chubb affiliates submitted a joint filing to reduce auto insurance rates by almost 10% in the state of Nevada, along with updates to their Masterpiece Auto Preference auto insurance product. Click to read more about the impact and new features and coverages added June 2017 proposal, which is still pending.

The Chubb group of insurance companies submitted a request to the Nevada Division of Insurance in July 2017 to decrease select companies’ rates by 9.2% and to introduce more discounts and features to customers for Masterpiece Auto Preference, their auto insurance product.

The filing is still pending and not approved yet, but the proposed changes would be effective for new customers and policies on March 12, 2018. These changes will affect existing policyholders on April 26, 2018, a month and a half later.

Chubb’s Proposed Rate Decrease Impact

Premiums are estimated to drop, on average, around $296 per affected policy, if approved, with 461 policyholders in Nevada in scope. The three Chubb affiliate companies identified are: the Pacific Indemnity Company, the Vigilant Insurance Company, and the Federal Insurance Company. The largest decrease on average may be seen by a handful of policyholders underwritten through the Pacific Indemnity Company, while the lowest mean decrease would be with the Federal Insurance Company. The expected premium price drop is a significant given the state's average cost for car insurance.

This table shows the changes in premiums and policies by company:

Chubb CompanyOverall ImpactEstablished Premium ChangeEstablished Policies AffectedAverage Premium Impact
Pacific Indemnity Company-9.60%-$15,93935-$455
Vigilant Insurance Company-5.10%-$98,820302-$327
Federal Insurance Company-3.50%-$21,721124-$175
All Companies-9.20%-$136,480461-$296

Chubb also provided estimates of the maximum and minimum percentage changes across the 461 policies. On one end, one policy is expected to see their premiums drop by 53.3%, while one policy would increase 99.0% under the submitted filing. Drivers insured with the Vigilant Insurance Company will have the broadest range of changes. The Pacific Indemnity and the Federal Insurance Companies, while they have similar ranges, are slightly less extreme. The drop in premiums will bolster Nevada's position as a state with lower than average car insurance costs when compared to the rest of the country.

Chubb’s Proposed Changes to Masterpiece Auto Preference

Rate decreases aside, the latest filing also provides a glimpse into Chubb’s attempt to make their product more competitive for families with new teenage or young drivers in Nevada. These include adding discounts such as a Good Student Discount, or even removing previous surcharges for additional drivers.

This table highlights the major types of suggested accommodations for youthful drivers as well as the max percentage discount contemplated in the Silver State. In most cases, Chubb defines youthful operators as drivers under 25 years old, with some exceptions outlined below. The company intends to apply the discounts on just the liability and collision portions of their premiums, which generally make up the largest portions of auto insurance costs.

Discount Name

Discount %Notes on the Discount
Good Student Discount1%-17%Tiered based on on age and marital status; older married drivers get smaller discounts of 1%
Driver Training DiscountUp to 25%
Tenure DiscountUp to 8%For customers of five years or more with unmarried 16-18 year old drivers
Non-Principal Driver DiscountUp to 20%Unmarried, < 25 years old, drive vehicle less than 30% of the time; can’t be combined with Away at School discount
Away at School DiscountTreated as MarriedSchool is more than 100 miles away, < 25 years old

Aside from the discounts related to children, a few other new discounts being proposed in Nevada for the Masterpiece Auto Preference product are:

  • Vehicle Ownership Discount of 5% when the insured car is owned and fully paid off
  • Portfolio Discount of 10% to 15% for having a homeowners insurance policy in good standing with Chubb
  • Customer Loyalty Discount of 2.5% for auto customers of 5-9 years, and 5.0% for customers with over 10 years
  • Anti-Lock Brake System Credit of 5% to liability and uninsured motorist premiums

Chubb will also be offering a few new optional features to their Masterpiece Auto Preference product. These are standard bells and whistles offered at other car insurance companies nationally, and will help to standardize Chubb’s offerings in Nevada.

  • Road Service Coverage: labor and towing up to 200 miles away, for $18 in additional premiums
  • Lease Gap Coverage: gap, early termination, physical damages coverage for leased vehicles, for $45 in extra premiums
Mark Fitzpatrick

Mark is a Senior Research Analyst for ValuePenguin focusing primarily on the insurance industry, primarily auto insurance. He previously worked in financial risk management at State Street Corporation.

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